We'll not lift ban on chrome: Mpofu

HARARE - Government says it will maintain its current ban on chrome ore exports until there is mandatory minerals beneficiation policy in place, amid mounting pressure from stakeholders who want it lifted.

Zimbabwe banned exports on chrome ore in April last year to promote value addition and employment creation. However, due to low smelting capacity in the country and low local demand, the mineral stocks have been rising with small-scale miners mostly facing viability challenges.

Obert Mpofu, Mines minister, told delegates at the ongoing 2012 Mining Indaba that when government temporarily lifted the ban on chrome exports, there was a rush to export the ore, thereby prejudicing the state of potential revenue.

“We will not consider lifting a ban on chrome because chrome exports are not benefiting our people,” he said. “Even if lifting of the ban creates employment, we are not going to consider the move as the selling of unprocessed raw materials results in the country losing a lot of potential revenue and job-creation opportunities.”

According to the US Geological Survey, Zimbabwe, along with South Africa, holds about 90 percent of the world’s chromite reserves and resources and the ban has affected exports to China and South Africa.
There are three large-scale ferrochrome miners in Zimbabwe, including Zimbabwe Alloys and Zimasco, which is owned by China’s Sinosteel.

Zimbabwe already has three smelters that have capacity to handle 1,5 million tonnes of chrome.

Mpofu noted players in the sector were aiming their efforts in the wrong place.

“Effort should be directed by the affected players towards setting up smelters rather than lobby to export raw materials. This is the only way that the country will only be able to realise benefits from its vast mineral resource base,” he said.

Government first considered banning export of raw chrome in 2007 as a loss-control measure. Two years later, a ban was slapped on the mineral in the first nine months of 2009. The ban was temporarily lifted in 2010 and revenue from chrome exports amounted to $33 million during the first nine months of the year.

Initially the move was an effort to promote small-scale chrome miners to set up more smelters around the country, but it has, however, had adverse effects on the intended beneficiaries.

The chrome ore mined in Zimbabwe is high grade (containing about 46 percent pure chrome), which is found mostly in the Midlands Province along the Great Dyke.

Major areas where chrome mining is undertaken are Shurugwi, Mutorashanga, Lalapanzi and Guinea Fowl with the smelting being done in Kwekwe. Chrome commands great interest because of its high corrosion resistance and hardness.

Minister Mpofu also assured foreign investors that there would never be any nationalisation of mines in the country.

“I want to assure investors that Zimbabwe is open for business as government is not going to expropriate or nationalise their companies. Government of Zimbabwe has no policy of nationalisation and mines will never be nationalised,” he said.

Meanwhile, the 2012 Mining Indaba started on a low note yesterday in the capital with stakeholders and investors slowly trickling in.

Mines minister Obert Mpofu conceded that previous indabas were successful as compared to the current edition.

“This is the fourth time that I am presenting at this indaba. The first time, four years ago, it was still experimental but it was a success and the conference was filled to capacity. The 2010 and 2011 editions were also successful,” he said. - John Kachembere and Roadwin Chirara

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