Zim a risky investment destination: Report

HARARE - Zimbabwe has been ranked among the riskiest mining investment destinations despite its vast mineral wealth, a study has revealed.

According to a report entitled Mining in Africa Country Investment Guide, specially produced for the African Mining Indaba underway in Cape Town, South Africa, the southern African nation — holding the second largest known platinum reserves in the world — is among countries that “offer greater risk yet less exploited mineral resources”.

“However, certain points stood in its favour,” noted the report, which was compiled by Singapore-based Global Business Reports in partnership with Mining Indaba LLC.

“These included last year’s ‘peaceful’ elections, and the undeniable mineral potential of the country,” read part of the report.

Zimbabwe holds an estimated 30 percent of the world’s diamond reserves, as well as substantial deposits of gold, platinum group metals and coal.

However, over the years the country has experienced a pronounced investor flight due to bad economic policies such as the land reform exercise and the indigenisation policy.

The report examined five regions on the continent — Central Africa, East Africa, North Africa, Southern Africa and West Africa — encompassing 53 countries in total.

Zimbabwe’s neighbours such as South Africa, Namibia, Botswana, Mozambique, Zambia, Madagascar, and Malawi earned a position among the top 20 “most exciting African mineral jurisdictions”.

The guide splits the eight southern Africa countries into two groups those that offer a low-risk environment with proven geological potential; and those that offer greater risk yet less exploited mineral resources.

On South Africa, it finds that despite the country having had “a tough couple of years”, with labour disputes and falling production, it continues to dominate African mineral production “to an extent that is impossible to ignore”.

It also suggests that increased mechanisation of the local miningsector could be beneficial.

On Botswana, the investment guide says the country’s traditional strength in diamonds is arguably not as exciting as its other mining potential.

Comments (1)

Fortunately these minerals will always be there.

Peter - 6 February 2014

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.