adminchallenges in the macro-operating environment.
The chambers mineral economist Mr David Matyanga recently told a 2012 National Budget consultative meeting that Zimbabwe could experience a decline in mineral output this year.
“The sector’s rate of growth this year could be much lower than anticipated,” he said. “For instance, gold output will grow by 22 percent, down from 35 percent last year, nickel at 22 percent (from 26 percent last year), chrome by 15 percent (from 166 percent last year), platinum by 21 percent (from 26 percent last year), and coal by 17 percent (from 66 percent last year).
“The mining sector is especially facing challenges in terms of the infrastructure.
“Although, for instance, some mining companies have signed ring-fencing agreements with the Zimbabwe Electricity Supply Authority, others have not and these are feeling the pinch of constant power outages.”
Mr Matyanga also lamented the fact that the sector is facing challenges in respect of financing, with most local banking products being considerably expensive, with some loans with interest of up to 22 percent.
Meanwhile, global analysts Business Monitor International (BMI) says the mining sector will grow by an average 8 percent to 2015.
BMI said although it expected the mineral sector to experience “short-term”, “renewed weakness”, as a result of internal policy shocks, it would quickly recover.
“We believe the mining sector will grow by more than 8 percent a year over our forecast period to 2015, with risks to the upside once the uncertainty over indigenisation has come to an end,” said the analyst.
The negative perceptions around the implementation of the indigenisation and economic empowerment programme may
well be falling away as the big foreign mining firms have begun to comply with the requirements.
Despite some concerns with the indigenisation drive, the country has continued to attract new investment into the sector.
According to an investment report compiled by the Zimbabwe Investment Authority for the past nine months, the mining industry is leading in investment approvals, followed by manufacturing, tourism, services, construction and agriculture.
But BMI’s figure falls short of official projections for the period, which are estimated at an average 22 percent on the basis of new capital injections, firming international metal prices, and improved energy supplies, according to the Medium Term Plan document.
But the international analyst believes the gold sector will remain the linchpin of the mining sector, with output expected to double during the five-year period to 2015.
The firm also expects significant contribution from the platinum and diamond sectors.
“Certainly, the gold sector looks well placed, following the liberalisation of the sector in 2009, with BMI forecasting a more than doubling in gold output between 2010 and 2015,” it said.
“Zimbabwe is richly endowed with deposits of chrome, gold, nickel and platinum, among other minerals. Its gold reserves are among the largest in Africa, while it hosts the second largest platinum reserves in the world.
“Another segment that has caught the attention of miners in Zimbabwe is diamonds, following the discovery of a number of significant kimberlites.”
The Minister of Finance Tendai Biti, in the 2012 Budget Strategy Paper, recently made proposals towards undertaking a study on the inventory of minerals to assess their potential throughput and value, with a view to enhancing the sector’s contribution to the fiscus.
Online Reporter