Three mining firms yet to comply

HARARE - Only three mines in Zimbabwe are yet to table plans on how they will comply with the country’s 51 percent indigenisation programme, according to Saviour Kasukuwere, the firebrand Youth Development, Indigenisation and Empowerment minister.

Zanu PF hawks, using the indigenisation programme as an anchor for the party’s election campaign for next year’s polls, have hailed the disclosure as an indication of the “success” of the country’s empowerment programme.

Metallon Gold, Falgold and Duration Gold are the remaining mines that are yet to submit their indigenisation plans.

Officials at the mining houses indicated this week that they were finalising and putting final touches to their indigenisation proposals set to be tabled to Kasukuwere “very soon”.

At Metallon Gold, one of the country’s largest gold producers, officials who requested anonymity indicated that the company was proposing to give 10 percent of shares to its 3 700 employees.

Mining consultant firm SRK values the Metallon Gold shares at $323 million.

Zimbabwe’s 51 percent indigenisation programme kicked off in earnest at the end of last year.

Mining companies have endured the same threats and ultimatums issued to the country’s largest platinum mine, Zimplats, a subsidiary of South Africa’s Impala Platinum Holdings.

Other mining companies such as Rio Tinto, Anglo Platinum, Unki Mine, Caledonia and Mimosa mine followed suit and tabled their indigenisation proposals that were similar to Zimplats’ indigenisation package.

Zimplats immediately ceded a 10 percent stake to locals and $10 million to locals under the community share ownership scheme earlier this year, although details of how the remainder of the shares would be disposed remains unclear.

Zimplats is demanding compensation from the government for its shares, estimated to be worth more than $600 million, but the cash-strapped unity government is unlikely to meet that demand.

Economics Professor Tony Hawkins from the University of Zimbabwe said it was not surprising that other mining companies had followed Zimplats’ lead.

“It’s (Zimplats), the biggest mining company, and it was natural that everyone else would coalesce around it and draw clues for their indigenisation plans from there.”

Economist Eric Bloch from H&E Consultancy cautioned that it was too soon for the country to claim it had scored any success from the indigenisation programme.

“It doesn’t happen overnight. It takes years for the indigenisation programme to translate into economic growth for the country,” said Bloch.

On Thursday, Kasukuwere ratcheted up the indigenisation drive further in Hwange, where he acquired shares from several mines: Hwange Colliery, Bubi Mine, Makome Mine, Hwange Coal and Gas and Mutapa Resources.

President Robert Mugabe officiated at the handover ceremony for the shares, and Mines and Mining Development minister Obert Mpofu hailed the spread of the indigenisation programme.

“Meaningful development is coming to the region for the first time in the history of mining, due to policies put in place by the government through the leadership of President Mugabe,” he said.

“We also believe that those lying about indigenisation will eat their words when they start to witness real direct empowerment.”

The International Monetary Fund (IMF), however, in its latest outlook on Zimbabwe has maintained a conservative stance on the empowerment drive that has unnerved foreign investors at a time when the country is ironically trying to woo investors.

“Directors underscored that improving the business climate is necessary to strengthen competitiveness, build investor confidence and boost the growth potential.

“In particular, they stressed the importance of ensuring that the indigenisation and empowerment policies are implemented in accordance with transparent rules and preserving property rights,” reads a part of the IMF report.

Kasukuwere brushed off the IMF’s concerns around the empowerment programme: “The struggle for freedom can only become sweet if we become economically independent. It is long overdue.” — fin24

Post a comment

Readers are kindly requested to refrain from using abusive, vulgar, racist, tribalistic, sexist, discriminatory and hurtful language when posting their comments on the Daily News website.
Those who transgress this civilised etiquette will be barred from contributing to our online discussions.
- Editor

Your email address will not be shared.