Zimbabwe’s Mining Sector : Prospects & Challenges

Mutuso DhliwayoZimbabwe Environmental Law

Association

Outline of Presentation

• Zimbabwe’s Mineral Resource Base • Contribution of the Mining Sector to Economic

Development • Problems within Zimbabwe’s mining sector • Conclusion

Zimbabwe’s Mineral Resource Base/ Endowment

• Zimbabwe has a significant and diverse mineral resource base

• The Zimbabwe Geological Survey of 1990 lists no fewer than 66 base and industrial mineral deposits

• 40 mineral deposits currently being deposited • Gold, coal, iron ore, platinum, diamonds,

chrome, emeralds , black granite, lithium

Zimbabwe’s Mineral Resource Base cont’

• Second largest reserves of platinum • Third largest reserves of chrome• 25 % of world diamond market needs

Projected Growth Rates : 2011-2015Source: MEPIP, RBZ and MOF

2011 2012 2013 2014 2015

Gold/kg 13,000 15,000 18,000 21,000 25,000

Nickel/t 7,675 8,842 10,611 12,733 15,279

Coal /t 3,000,000 6,360,000 7,146,000 7,146,000 7,146,000

Asbestos / t 2,100 2,100 2,100 2,100 2,100

Chrome/t 610,000 700,000 700,000 7000,000 7000,000

Platinum/kg 12,000 13,287 15,751 19,721 19,666

Paladium/kg

9,600 10,630 12,601 15,776 15,732

Blackgranite/t

168,000 170,811 173,748 176,602 179,511

Diamonds (caratas)

8,065,651 12,111,867 14,837,707 18,443,797 21,463,054

Growth Rate 44% 20% 18.3% 19.4% 8%

Contribution of the Mining Sector to Economic Development

• Zimbabwe’s Economic Problems • Mining will play a catalytic role in economic

recovery • The mining sector has the capacity and

potential of being the both the foundational & champion issue for the reconstruction of the country -2012 National Budget Statement

Contribution of the mining sector cont’

• Mining has the capacity and potential to create substantial impetus for economic growth & value addition – Medium Term Plan

• Mining can help kick start economic recovery, stabilisation and eventual growth of the economy- ZMRTI

• Mining sector is the core pillar of the country’s economic and social turn around and developmental plans. Success of the MTP is anchored on the mining sector - MMMD

Contribution of mining continued

• Mining sector has grown at an annual rate of more than 30% since 2009

• Average contribution of the mining sector to the GDP has grown form an average 10.2 % in the 1990s to an average of 16.9 % from 2009-2011

• Mineral exports rose by about 23% over the 2009 -2011 period ( leading export earner )

Problems in Zimbabwe’s Mining Sector

• Potential , comparative as opposed to competitive advantage

• Curse of poor laws and polices • Importance of laws and policies in unlocking value

from mineral resources • Old, archaic and colonial piece of legislation – Mines

and Minerals Act [ Chapter 21:05]• Zimbabwe’s mining laws are criminal-Mutambara• Obscure legal regime codified in the Mines and

Minerals Act - Biti

Problems in Zimbabwe’s mining sector

• Does not recognise HR- violation of communities’ EESCR

• Limited transparency and accountability • No access to information • Role of other stakeholders in the mining sector • Lack of participation by CBOs and CSOs in the

policy and decision making institutions • No competitive licensing process with no

mechanisms for public accountability

Problems in Zimbabwe’s mining sector cont’

• Corruption – NIEEBGATE and DIAMONDGATE scandals

• Politicisation of the mining sector ie Community Share Ownership Schemes

• Zimbabwe Mining Revenue Transparency Initiative

Conclusion

• Mineral resource endowment • Potential of mining to contribute to economic

development • Problems affecting the potential of the mining

sector • Opportunities – New constitution, Draft

Minerals Policy, development of a new Mines and Minerals Act

• THANK YOU