HARARE – Zimbabwe must implement mining sector reforms to achieve sustainable economic growth, the African Development Bank (AfDB) has said.
“The development of a mineral policy is critical, particularly given the increasing role of the mining sector in supporting the socio-economic growth objectives of the government, job creation, and revenue and export earnings,” said the regional financial institution in its May monthly review.
The southern African country — which is still reeling from hangover of a decade-long economic meltdown — is in the process of developing a mineral policy that seeks to, among other things, address challenges affecting the sector and explore ways of attracting investment to the sector.
To date, the Mines and Mining Development ministry has held consultations with stakeholders in Masvingo, Bulawayo and Kadoma to solicit views and enhance stakeholder buy-in on the draft policy. More stakeholder consultations are planned for the other mining centres across the country.
Since 2009, the mining sector has been one of the sectors anchoring the growth recovery process in Zimbabwe, contributing an estimated 16 percent to gross domestic product in 2012, up from 13 percent in 2011.
The sector also continued to lead in export earnings, rising to $2 billion in 2012, from $1,8 billion in 2011, with major drivers of this growth in export earnings being diamonds, platinum and gold.
However, there has been resistance from other stakeholders on the draft policy — which proposes to establish an internationally competitive, stable and conducive business climate to attract and sustain foreign and local investment, while ensuring equitable distribution of benefits from mining activities to meet both current and future needs.
Last month, the Chamber of Mines of Zimbabwe rejected a proposal for the State to control mineral production and prices.
“We will contribute effectively to the on-going development of a new mining policy. We do not regard our role as opposition to government but partners seeking the same national goal and aspiration,” said Alex Mhembere, president of the Chamber of Mines.
The mining draft policy further proposes to overhaul the Mines and Minerals Act and introduce new minerals development legislation that will maximise the impact of mineral assets on growth and development.
In addition, a web-based mining survey and information management system will enhance transparency in the awarding and monitoring of mineral rights.
Deputy Prime Minister Arthur Mutambara recently said the current mining legislation was archaic and in dire need of upgrading to bring it up to date with modern trends in the global mining industry and the country’s current and future aspirations.
“The Government is working on having this Act repealed in its entirety and have it replaced by a totally new Mines and Minerals Act that caters for the dynamic modern day needs of the sector, while resolving historical institutional injustices,” he said.
Wellington Takavarasha, president and chief executive at Zimbabwe Artisanal and Small Scale for Sustainable Mining Council, said the gazetting of a new mining law would boost the economy.
“In 2004, small-scale miners produced 16 tonnes of gold but by last year the figure had dropped to just two tonnes. The reason was that the government of that time tightened laws for this group to enable space for the big fish. If we have a new law, we can go back to such high production which is good for the economy,” he said.