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THE mega investment deals being realised in the mining sector should steer growth in other sectors of the country’s economy, Finance and Economic Development Minister Patrick Chinamasa has said.
Zimbabwe has in recent years become a mining investment destination of choice with numerous investment proposals running into billions of dollars for the exploitation of minerals.
Apart from the $4 billion Zim-Russia platinum deal along the Great Dyke — sealed by President Mugabe recently — the country has bagged many other investments in diamonds, gold, tungsten, coal, chrome and iron among other minerals in the past few years.
The unprecedented growth of the sector, which has also roped in thousands of small-scale miners, should induce the desired impetus into the broader economy, said Minister Chinamasa.
In a speech read on his behalf by Judith Kateera, a senior ministry official at the just ended Buy Local Summit in Victoria Falls, Minister Chinamasa said the government expects more proceeds from the mining sector that will be used to recapitalise other sectors of the economy.
He challenged miners to procure locally and breathe life into downstream industries.
“We need to look at how to put Zimbabwe back on the growth pedestal. We need to be pragmatic and exploit the existing linkages. In this regard mining is very critical to Zimbabwe’s economic growth,” said the minister.
“About 60 percent of our export earnings come from mining and this isn’t commensurate with the sector’s contribution to economic development.
“Local industry isn’t benefiting from mining. Mining firms import consumables and we want them to source from local suppliers and assist growth downstream.”
Minister Chinamasa said pinning hopes on foreign funding was not sustainable and called for innovative and creative approaches towards industry funding in order to realise desired national economic turnaround goals.
He said the huge export volumes from raw minerals and tobacco, for instance, were not useful on their own unless they were harnessed to catalyse growth in other sectors.
“Raw material exports lead to job exports hence beneficiation is crucial for Zim-Asset. The government and the private sector should collaborate on this,” said the minister.
“We need to enhance transparency and accountability in mining. I’m not convinced the industry is transparent enough given the huge gap of information asymmetry between miner and the government. We want the country to benefit from its mineral resources. Beneficiation and clean capitalisation are paramount.”
Minister Chinamasa blasted some mining firms for dishonest reporting to the government in a bid to evade paying taxes.
He said the government was seized with crafting new mining fiscal regulations to enhance efficiency in the sector and invited the players to submit their proposals.
“I’m confident the mining sector can vibrantly turn around the economy of this country,” said Minister Chinamasa.
Online Reporter