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Chamber of Commerce annual congress in Victoria Falls last week responding to questions from delegates on why Zimbabwe remained poor despite the country’s abundant natural resource endowments.
The congress, held from June 12 to June 14 2013, was held under the theme “The Roadmap to Zimbabwe’s desired future, defining possibilities that deliver value”.
DPM Mutambara said there was evidence of oil in Angola and evidence of diamonds in Botswana, but Zimbabwe, like many other resource rich African countries, had no evidence of its abundant natural resources.
“One of the major problems we have around natural resources is that the laws obtaining are detrimental to Africa, they are detrimental to the countries. They are colonial. When we had our independence in Ghana in 1957 we changed political laws, human rights laws, we didn’t touch the natural resource laws,” the DPM said.
“The same applies to Zimbabwe you look at our mining law in 1980 democracy, human rights and voting. South Africa, 1994, again same problem, what is the major problem, the right to mine is not linked to the asset underground, which means an investor or prospector is given a claim for free.
“They can take that claim, to show that it is fair for them to take that claim for free, they can take that claim and list it on the stock exchange in Australia or Canada and borrow US$2 billion on the strength of the claim, which means others know the value of the claim, we do don’t, what we call information asymmetry,” DPM Mutambara said.
It is against this background that the DPM has on several occasions called for investment into building a minerals database to document areas with mineral resources to ensure Government engages investors from an informed position to derive maximum benefits from minerals.
He said Government and its people did not know the value of the asset underground while the laws had not empowered people to obtain value from the minerals apart from the dividends such as taxes and royalties.
DPM Mutambara said African governments keep repeating the same mistakes, for instance, Ghana recently discovered oil and the investor owned the rights as “the discoverer becomes the owner of the asset underground”.
The DPM said another example that show the claims given for a pittance held huge value was when Zimplats was given huge tracts of land and when asked by Government to release back some of it they put a US$150 million price tag because they are not “dump, deaf and blind”.
DPM Mutambara also blamed poor management of the resources and policy framework to maximise the effect of mineral proceeds on the economy considering countries like Botswana have achieved some desired results.
He pointed out that while there were big problems there was no big evidence of the existence of abundant diamonds, gold and platinum in Zimbabwe. There were also serious policy deficiencies within “our systems”.
“So what we need to do is to ensure that we review those laws and ensure there is transparency and good governance around our minerals, but more importantly, we also move toward beneficiation,” he said.
According to Mines and Mining Development Minister Obert Mpofu the ongoing exercise to craft a Minerals Development Policy are meant to ensure the resultant new mining legislation speaks to the aspirations of indigenous people with regards to impacting their economic fortunes.
Online Reporter