Source: Use it or lose it mining policy key for economic revival | The Herald June 4, 2019
Beaven Dhliwayo Features Writer
The use it or lose it mining policy which Government said it will put in place is long overdue as the mining sector is one of the economic pillars and a key foreign currency earner.
Mining generates more than half of Zimbabwe’s export receipts and in 2018 it earned US$2,8 billion and with improved utilisation of idle mineral deposits in the hands of foreign investors the sector has the potential to earn more with increased investment.
The policy will be a clear sign that Government always remain unbendable in its fight to empower the people of Zimbabwe.
Some foreign investors in the sector have for quite some time held claims without utilising them defying the country of the much needed foreign currency as well as job creation.
For instance, near-fights between Government and the Zimbabwean Platinum Mines (Zimplats) is inexcusable at all as these claims could benefit small scale miners who are willing to play a crucial role in the Great Dyke.
Of importance to note is that enforcing the policy will empower local small scale miners who have proven to be viable in the recent past years.
In 2017, artisanal gold miners using outdated equipment outproduced large-scale mining companies formally marking a power shift in the mining economy from major players.
Small mining outfits produced 3,163 tons of gold in the fourth quarter of 2016, compared with 2,958 tons produced by large mining operations, according to data from Fidelity Printers and Refiners.
Zimplats has always resisted to relinquish 27 809 hectares of land containing platinum and at one point it took Government to court yet up to now the reserves are unutilised.
The Mzi Khumalo owned Metallon Gold is also in possession of idle claims at Shamva Mine and Jumbo Mine.
Illegal miners are preying on the idle claims and this comes at a huge cost to the country in lost revenue.
These miners can face a number of risks to their well-being, including physical, ergonomic, and psychological problems.
The most common causes of fatal injuries in the mining industry include falls from height, entrapment, and mobile equipment accidents.
Illegal miners in these idle claims do not practice a form of safety measures and risk losing lives at all times.
Withdrawing mining rights from companies that take long to dig for minerals and give it to players both local and foreign who are able to utilise land containing the minerals will lift output in a sector vital to the country’s economic revival.
Repossessing of the claims by the State will help in the generation of revenue for Treasury and alleviate the country’s liquidity crunch and restore employment to thousands of workers who lost their jobs when the Companies stopped operations.
At Jumbo Mine for instance, many employees had their contract terminated illegally and those who were lucky to stay have salary backlogs and the owners of the mine are mum about the issue.
It’s been almost a year without going to work and they have lost confidence if the mine will reopen or will they ever receive their salaries.
During a recent youth indaba in Harare, President Mnangagwa said mining companies holding on to claims should either use them or risk losing them to the State even if they are paying fees to keep them.
In the Transitional Stabilisation Programme (TSP) Government said it will embrace more transparent mechanisms for issuing mining rights, targeting to bring in more financial benefits to the economy from natural resources.
This would include open bidding, and open auctioning systems.
TSP also aim at providing a platform that will allow a growth in mineral production from annual estimates of US$2 billion per year, by the registered 800 mines, to over US$20 billion annually over the horizon of Vision 2030.
This noble policy will only be realised if all the idle claims are taken back by the State and be given to able players through the use it or lose it mining policy mooted by President Mnangagwa.
Mining rights in this country are vested in the President. This means acquisition of any claim does not transfer ownership from Government to an investor.
Companies like Zimplats always argues that Government must pay millions of dollars in compensation and yet the land has always belonged to Government as provided for in the Mining Act.
The use it or lose it mining policy creates a level playing field for both large and small players in the sector, but is always perturbed by the ignorance of investors who are against the idea of releasing unused mining claims to those who are ready to utilise it as the country moves towards being an upper middle income economy by 2030.
Government, under the TSP, has already identified the mining sector as important in empowering its citizen and this means it requires all the support to achieve this noble vision.
With the powers vested in it, Government at this point should not hesitate to beckon its muscle and ensure that idle mines are repossessed and be given to players who can drive production for the betterment of the economy.
The World over governments have the right to demand the release of any excess claims without having to pay for them because a mining right does not translate into ownership of assets thereof.
The miners, even if they are given the time to gather themselves and reopen, will not even exploit all the minerals on the country’s land thus pushing for the policy makes a lot of sense as other investors big or small will be allocated the unused claims to create employment, value and revenue for the country at large.
Zimbabweans have every right to profit from their vast mineral resource base and Government intervention becomes critical through the use it or lose it mining policy to repossess all the idle mines and allocate then to small scale miners and other foreign companies that can turn them into tangible value.
Over the years, apart from the mines that closed such as the Mazowe Mine, there are many conglomerates who have been holding mining claims for decades only for speculative purposes yet these claims are of significance to the Zimbabwean people who can derive economic value from them.
Most of these claims are being auctioned on the Internet yet small scale miners in the country can be empowered and generate value for the benefit of the country.
Government, through relevant authorities should do away with selfish investors and allocate the claims to those who are willing to utilise them for the good of the country.
Due to the prevailing economic environment where foreign currency has been a big problem for the Government to fully fund these miners with their raw materials, the Companies should release the excess claims to other investors, thus cushioning the country and subsequently lead to the generation of more foreign currency.
Even though some big conglomerates have invested millions, they will not exhaust the minerals in this country in the foreseeable future.
For example, a study revealed that at the current mining levels in the country, it will take at least 400 years for Zimbabwe to exhaust its platinum reserves.
This means there is a surplus that can allow other investors to come on board.
If the country has more investors both local and foreign, more jobs will be created for the youths who make up the bigger chunk of the unemployed in the country.
Such a scenario will even create more lucrative opportunities for downstream industries.
Too many claims are in the hands of speculative buyers and yet we have serious local and even international investors ready to inject funds into mining.
In this instance, the Government should now be more aggressive in implementing the use it or lose it policy which can turnaround the economy.