Biti under fire

Vice president of the Chamber of Mines, Mr Allan Mashingaidze said it was surprising that Minister Biti claimed that the mining sector had contributed only US$4 million per year despite the huge contribution they have made. Mr Mashingaidze was giving oral evidence before a Parliamentary Portfolio Committee on Mines and Energy. The committee chaired by Guruve South MP Cde Edward Chindori-Chininga (Zanu-PF) wanted to be updated on the organisation’s operations and challenges.

“We feel there seems to be selective recognition of the contribution being made to the fiscus. You need to look at the value of gold exported and just calculate seven percent of it that goes to the fiscus,” said Mr Mashingaidze.

He said besides the seven percent of exports remitted to the fiscus, they also paid corporate tax, value added tax and levies to the rural district councils they operate in.

“All these contributions are being ignored. There is need for a holistic look at the contribution and the way calculations are made so that a fair comment is made,” he said.

Uzumba MP Cde Simba Mudarikwa (Zanu-PF) had asked what contributions the sector had made to the fiscus. On challenges, Mr Mashingaidze said Zesa was switching them off despite the fact that they would have entered into agreements for uninterrupted supply that is calculated at a higher tariff.
“We still have loss of power which Zesa claims it’s a fault but our suspicion is that it is load shedding. They can’t honour their agreement 100 percent,” he said.

Mr Mashingaidze said gold producers were owed more than US$30 million by Fidelity Printers and this made it difficult for them to sell minerals to the institution.
“From a patriotic point of view we would want to work with a Zimbabwean firm, but from a legacy point of view, it is difficult to enter into a relationship where Fidelity has not paid us. The feeling is that the issue needs to be retired first. It does not mean we do not want to work for Fidelity but there is that episode in history that needs to be corrected,” he said.

On Exclusive Prospective Orders, he said the industry was concerned that Government had suspended issuing of new EPOs. He said they were, however, pleased that the Government had since invited those that had applied to confirm if they still wanted their applications to be processed.

“Those who were doing it for speculation will not come forward, and that will free up more ground. We are quite pleased that something has started happening although we have not seen results,” he said.

Chairperson of gold producers in the Chamber of Mines, Mr Toendepi Muganyi said the gold industry required at least US$1 billion in the next five years for it to fully exploit the resource. He said the industry has been affected by a skills flight with the University of Zimbabwe reportedly left with only one geologist lecturer. Mr Muganyi said the industry continued to be dogged by operational challenges like overhead costs. He said while the price of gold had risen, other operational costs had also surged, leaving the industry still in a precarious position.