via Zimbabwe Mulling Mining Bond Offering, Mines Minister Walter Chidakwa Says By Joseph Adinolfi IBTimes October 29 2013
Zimbabwe’s government is mulling its options for creating an international bond that will be used to expand the country’s mining sector, Mines Minister Walter Chidakwa told Bloomberg.
According to Chidakwa, officials have not yet decided how much they will raise or who will be responsible for putting the bond together. Chidakwa said he will meet with Finance Minister Patrick Chinamasa before the release of the country’s budget next month.
Analysts are skeptical about Zimbabwe’s ability to attract foreign investment in its mining sector because of the government’s policy requiring mining companies to sell or relinquish 51 percent of their assets to the country’s black citizens, according to a story on Mining.com. Zimbabwe has the world’s second-largest reserves of platinum and chrome.
Zimbabwe’s platinum mining industry needs as much as $5.3 billion to expand and allow it to produce more than 500,000 ounces of platinum and construct precious and base metal refineries, the Platinum Producers Committee said in a report earlier this month. Zimbabwe’s mines are forecast to produce about 365,000 ounces of platinum this year, according to the PPC.
Zimbabwe’s GDP totaled about $10.8 billion in 2012, according to the World Bank. The CIA World Factbook estimates that exports of goods and services account for nearly 70 percent of GDP. Precious metals and alloys account for a large percentage of the country’s exports, alongside tobacco, cotton and textiles.
Chidakwa announced the proposed bond sale during an industrial conference in Bulawayo, the country’s second-biggest city, on Oct. 10.