MTP in bid to enforce Mines Act

Minerals Amendment Act by the end of the year as part of efforts to tie loose ends to the legislation.
The aim of the MTP, running from 2011 to 2015, is to maintain investor friendly legislation and a legislative framework that takes into account benefits that must accrue to Government and local communities where mines operate.

The broad objective of the MTP during its five-year term is to ensure profitably natural resources and mineral endowments for socio-economic development.
It is now generally agreed that mining, which is projected to grow by 44 percent this year and anchor the economic growth forecast of 9,3 percent this year, will drive Zimbabwe’s economic growth in the foreseeable future.

Through the amended legislation Government will ensure enforcement of the use it or lose it policy to curtail speculative holding of claims by mining companies. The policy will make it expensive to hold undeveloped claims.

“The amended Mines and Minerals Act will create an environment that allows the mineral endowment to be profitably exploited for the socio-economic development of Zimbabwe,” reads an excerpt from the MTP.
Main tenets of the amended law include reviewing the mining titles administration system, reforming the mines affairs board, ensuring a system that guarantees security of tenure and effective environmental management best practices.

But the MTP also intends to ensure conclusion of the Zimbabwe Mineral Policy by 2011 and adoption and implementation of the internationally adopted extractive industries transparency initiative (EITI) by the end of the year.

The extractive industries transparency initiative helps resource rich countries maximise the economic development gains from the exploitation of their oil, gas and minerals by encouraging greater revenue transparency.

Benefits of EITI will include improved investment climate, strengthened accountability and good governance, transparency of payments to Government, increase in the amount of information in the public domain and raise State accountability.

The MTP also envisages mineral value addition as most of the country’s extractive commodities are exported in raw form denying the country of revenue.
Opportunities in value adding minerals are abundant in diamond cutting, polishing and processing, platinum refinery, gold and diamond processing into jewellery, lithium processing and battery making and granite processing.

Government’s new five-year economic blueprint will also ensure that Treasury realises more revenue from mining activities through royalty fees. The royalty policy, says the MTP, will consider the level of local ownership and beneficiation initiatives. Royalties will also be linked to the sector’s performance.

Efforts will also be made to ensure development of small-scale mining and through technical support to make them self-sustainable and develop bankable projects.
Under the new policy the Government will also strive to attract and retain key skills like geologists, engineers, technicians and managers to turn around the sector.
Government also realises the critical aspect of corporate social responsibility in mining and would ensure local communities benefit as minerals are finite.

But one of the most neglected aspects of mining has been the issue of environmental management. Many areas have been left degraded after minerals are exhausted.
“As the scale of operations in the mining sector is set to increase during the plan period, integrated environment management guidelines will be implemented and emphasised,” says the MTP.

In this regard priority will be given to environmental management during the licensing process through development and implementation stage of mining.
Stringent penalties will be imposed on, grater advocacy placed on environmentally sound technology and the use of less toxic chemicals. There will also be emphasis on post extraction environmental recovery and building resilience against climate change through improved optimal procedures and effective waste management.

When the MTP runs its full course it is expected the policy will have created capacity and potential for greater impetus for economic growth and value addition.
Mining is strategic to Zimbabwe as it presently accounts for more than 50 percent of exports and is a major source of foreign direct investment.

The sector also creates a substantial amount of jobs, but skewed policies over the last decade of economic instability had seen all but three mining firms closed.