Chronicle Editor
Yoliswa Dube-Moyo, Features Editor
Zimbabwe’s extractive industry is well on course to attaining the US$12 billion mining milestone by 2023 despite the debilitating sanctions imposed on the country by the West some two decades ago.
Renewed investment interest in the mining sector has seen the establishment and expansion of critical mining operations across the country with the gold sector expected to deliver the 100-tonne target.
President Mnangagwa launched the US$12 billion mining industry strategic roadmap in 2019 and its targets are set to be met by next year.
The mining sector is critical in generating foreign currency, contributing about 70 percent of the country’s forex earnings, largely driven by gold, platinum, and diamond.
Leading mining companies such as Blanket Mine, Pretoria Portland Cement (PPC) and Duration Gold are already seized with the implementation of different expansion projects that involve millions of United States dollars.
These are being complemented by artisanal small-scale mining breakthroughs in different resource districts, which have seen the sub-sector contributing more to formal gold deliveries.
Blanket Mine, which is owned by Caledonia Corporation, has already completed a new central shaft project under a US$70 million expansion project and is now focused on establishing a solar plant to enhance its energy supply.
The investment is already impacting positively on improved quarterly output with the company now officially trading on the Victoria Falls Stock Exchange (VFEX).
PPC, which operates a clinker production plant in Colleen Bawn has also maintained steady operations and recently unveiled a US$40 million solar power investment for its Bulawayo and Colleen Bawn plants, which will boost the firm’s energy requirements and help reduce the supply gap in the country.
The planned projects are expected to yield a combined output of 30MW, of which 17MW is for internal consumption with the excess of 13MW set to be fed into the national grid.
Duration Gold subsidiary, Vubachikwe Mine, recently launched its US$2,6 million Tailings Storage Facility (TSF), which is expected to extend the mine’s depositional life by a further 20 years.
Duration Gold Limited recently embarked on an airborne geophysical survey through partnership with world leader Xcalibur Airborne Geophysical Surveys from South Africa, a move expected to culminate in the country having a better appreciation of its mineral potential.
With a modern approach to airborne geophysical surveying, the radiometric and magnetic survey is the second largest such endeavour of its kind, following another such project conducted in the 1980s.
The establishment of a US$1 billion iron ore mining and value-addition industrial park in Manhize, Chirumanzu District, Midlands Province is also expected to positively impact the country’s extractive sector and assist Zimbabwe to wean itself from reliance on imports.
In a recent interview, Chamber of Mines in Zimbabwe chief executive officer, Mr Isaac Kwesu said the investment project would have a huge impact on the mining sector, which will broaden its output, and enhance import substitution and exports, thereby helping to achieve the Government’s US$12 billion milestone by 2023.
“This is a very important development and initiative for the mining industry in Zimbabwe at large. The project will have a huge impact on social and economic development. It will create employment and have spill over effects to the upliftment of standards of living for the surrounding communities,” he said.
“To the mining sector, it will have a huge effect in terms of contribution to the GDP (Gross Domestic Product). In terms of export earnings, it’s going to be one of the major contributors of the mining industry to foreign exchange.”
The Chamber of Mines executive said the integrated nature of the new iron and steel project entails higher value chain linkages for upstream and downstream industries.
For instance, he said the iron and steel plant involves the mining of iron ore and working closely with other mining sectors such as ferrochrome production and coke processing.
“You can see in terms of what is required of the projects. Ferrochrome and the growth of the ferrochrome sector are critical as well as reduced logistical and transportation costs.
Ferrochrome will be transported and fed into steel and the iron mining itself and all mineral-related elements to the creation of stainless steel will all have something to do,” said Mr Kwesu.
For two decades, Zimbabwe has been under sanctions imposed by the UK, USA, Canada, Australia and the EU in response to the land reform programme that the Government undertook through Amendment 17 of the Constitution which allowed expropriation of land without compensation.
The Zidera Amendment Act (2018), which targeted 141 individuals and 56 companies, further places financial restrictions that block debt cancellation to Zimbabwe and bars financial institutions like the International Monetary Fund, World Bank and Africa Development Bank from extending any loan to the country without the approval of the US President.
The restrictive measures placed by the EU include the suspension of budgetary support to Zimbabwe, suspension of financial programmes as well as an embargo on the sale, supply, transfer of arms, assistance or training related to military service as well as a travel ban and freezing of assets to individuals that have been placed on targeted sanctions.
The sanctions imposed on Zimbabwe exist in the form of targeted sanctions as well as multilateral financial restrictions. Some Government officials, State owned enterprises and institutions have been sanctioned.
Articles 39 to 42 of the United Nations Charter clearly state that economic embargoes can be used in the conduct of international relations on the condition that they are authorised by the United Nations Security Council (UNSC). But, sanctions imposed against Zimbabwe were passed outside this multilateral forum.
International norms which must be respected in the conduct of international engagement, foreign policy and diplomacy, that is non-intervention and state sovereignty are choked by these sanctions.
The embargo further contradicts the basic international principles of the United Nations Charter because they deprive and violate innocent civilians’ right to personal development.
While the country has been doing considerably well despite the sanctions, the effects cannot be ignored.
The implications of the sanctions have been costly. They have brought bad publicity and restrained the country from harnessing massive investments.
Zimbabwe’s access to international credit markets have also been blocked by the imposition of sanctions so is the country’s balance of payments position.
According to research, Zimbabwe lost an estimated US$42 billion and another estimated US$4,5 billion annually for more than two decades. Another staggering US$2 billion was lost in IMF, World Bank and African Development Bank loans.
These sanctions are not only a challenge to Zimbabwe but they also affect regional integration in Southern Africa at large and so they must go. — @Yolisswa
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