Chronicle Editor
Oliver Kazunga, Senior Business Reporter
GOVERNMENT expects the growing interest in the lithium mining industry to yield at least US$500 million investment by 2023.
Finance and Economic Development Minister, Professor Mthuli Ncube, revealed this in Parliament last week, where he explained Government’s efforts in trying to incentivise investment in the sector.
“We are trying to grow our export earnings in the sector. Really, we do not want the tax to be an impediment towards that kind of investment.
“We want to make sure that the investment flows in. It is our desire that we have an investment of US$500 million equivalent between now and the year 2023 in the lithium sector,” he said.
“We believe that through tax incentives in the form of a tax exemption is one way to attract investment.”
Prof Ncube said the lithium sector was new in the country unlike other sectors such as platinum hence Government needs to come up with policy initiatives such as tax exemptions to promote the growth and development of the sector.
“Imagine if you say to a new investor – this is a new area by the way, unlike platinum, which is now an old area in terms of minerals.
“Lithium is a new area. If you say to them, look, you cannot invest if you are not going to build a battery manufacturing factory, which is full beneficiation. It then takes a while for investors to digest all of that and make the right skills available for that to be the case.
“We feel that if we leave it like that at this stage; have this tax exemption, that is a major boost for investment into the lithium sector,” said Prof Ncube.
President Mnangagwa in October this year launched a strategic roadmap to the achievement of a US$12 billion mining industry by 2023, with lithium expected to play a huge role. Government wants the mining sector to increase its contribution to the economy. The projected increase represents would a 344 percent jump from US$2,7 billion achieved in 2017.
Already, the mining sector is critical in generating foreign currency, contributing about 70 percent of the country’s forex earnings. Under the US$12 billion mining roadmap, gold is expected to contribute US$4 billion, platinum US$3 billion, chrome, iron, steel diamonds and coal will contribute US$1 billion while other minerals will contribute US$1,5 billion. – @okazunga.
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