adminIt was presented by CoMZ first vice-president Mr Allan Mashingaidze during a consultative meeting with the chamber in Harare yesterday.
According to secretary for Mines and Mining Development Mr Prince Mupazvirihwo, the new policy is designed to guide the crafting of a new minerals and mining law to address the country’s aspirations.
But Mr Mashingaidze said controlling mineral prices could lead to the same problems that affected the mines after a similar policy decision in 2006.
Most mining companies, except Zimplats, Mimosa and Murowa Diamonds, closed shop until 2008 due to viability constraints when Government started paying for mineral exports partly in local currency, as it also sought hard currency to cover key obligations.
“In terms of marketing, we believe that prices should be determined by the market to avoid any distortions. All of us were around in 2006, 2007 and 2008 and we know what happens when you try to control prices of minerals,” Mr Mashingaidze said.
He also said Government should let demand, supply and capacity to determine production limits, adding that the issue of regulating mineral production was “another questionable policy” proposal.
“Should we not allow production to be determined by demand, supply and capacity to produce and take advantage of certain economic conditions?” the CoMZ vice president asked rhetorically.
The chamber also said it had reservations over Government’s proposal to control the production and marketing of minerals, which are critical feedstock to manufacturing, infrastructure, agriculture and
power.
“You find that all minerals, except gold and platinum, will become strategic because the moment you say ‘iron and steel, limestone, coal and base metals’, you have taken the whole sector,” he said.
Against this background, Mr Mashingaidze said there was need for clarity on the designation and definition of strategic minerals, otherwise the sector would collapse as investors would stay away.
He said the new minerals development policy should be informed by constraints facing the mining sector and the economy to ensure the policy promotes mining as the anchor to the latter’s growth by considering the sector and country objectives.
CoMZ said Government should ensure there was clarity on the process for acquiring mining rights, security and tradability of mining titles as the chamber felt provisions on mining title disposal are hazy.
Mr Mashingaidze said CoMZ had reservations over proposals to introduce 25-year mining leases, saying that this created unnecessary risks.
Rather, CoMZ has proposed for a mine life policy based on resources as determined by internationally accepted formulae.
CoMZ has also called on Government to ensure that the proposed taxation system, largely anchored on resource rents, is not counter-productive.
Chronicling a number of policy proposals on which CoMZ has reservations, Mr Mashingaidze said the fact that the chamber was not consulted at the outset meant its contribution only came at critiquing stage.
He also said the challenges that Government encountered in enforcing provisions of the current Mines and Minerals Development Act were due to lack of capacity to police in Government Departments responsible for monitoring provisions of the Act, which will be critical because the legislation would bring more responsibility requiring even better institutional capacity.
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