Funding for mines

By Almot Maqolo

HARARE – In the 2022 pre-budget statement, the Ministry of Mines and Mining Development stated that approximately US$8 million will be needed to fund programs for the revival of the nation’s closed mines. The government allocated US$10 million of the Special Drawing Rights (SDR) resources towards the opening of the Bubi Gold Service Center in the 2022 budget as part of its efforts to empower small miners.

The Covid-19 pandemic, which also had an impact on investment flows globally, exacerbated the trend of low foreign direct investment (FDI) inflows in Zimbabwe. Experts anticipate that total FDI inflows to Zimbabwe will stay low in 2022.Nevertheless, despite modest FDI flows, local mining industry investment was strong. In response to the necessity to enhance production as commodity prices rise, mining companies were able to raise money from within our borders.

Kuvimba Mining House would be a significant instance. Significant shareholders include the government, Datvest Nominees, Deposit Protection Corporation, Wealth Fund of Zimbabwe, and Public Service Pension Management. After purchasing the Freda Rebecca Gold Mine, the Bindura Nickel Corporation, the Shamva Gold Mine, the Jena Mine, the Elvington Mine, and Zim Alloys, Kuvimba most recently purchased a majority interest in Great Dyke Investments.

Industrialists predict that the government will keep updating its policies in the future to foster an atmosphere that is favorable to both foreign and domestic investors. In the mining industry, beneficiation is still a major problem that slows revenue growth. The following are ways that the government has aimed to increase the value of minerals: processing of gold ore into bullion through the establishment of gold processing and milling service facilities. Zimbabwean gold is sent to South Africa for final processing before being sold there because of its access to the London Bullion Market (LBMA).

Zimbabwe exited the LBMA in 2008 as a result of its declining gold output, which fell to 3,072kg tons. Since then, the nation’s output has increased, and efforts are being made to re-join the LBMA. South African company Rand Refiners charges a 0.3% levy on gross income. The government would support the construction of more plants for cutting and polishing diamonds. Government assistance is being provided to the private sector for base metal refinery construction.

Right now, nickel in concentrate is sold by miners like BNC. This implies that the corporation only receives about 65% of the global prices. Given the closeness and South African miners’ involvement in the domestic platinum production in Zimbabwe, all of the country’s platinum production is exported to South Africa for additional processing. Coke to Coke Processing Plants: The government will no longer grant coal mining firms licenses without first establishing coke oven batteries.

According to government plans to implement the prohibition, unprocessed chrome ore and chrome concentrates would no longer be exportable as of July 1, 2022. The establishment of integrated chrome mining and ferrochrome smelting by potential mining houses will be a requirement for awarding chrome mining claims in the future.

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