(HERALD) Economic, political reforms set to aid mining

Economic, political reforms set to aid mining
Business Reporters

THE ongoing economic and political reforms will play a key role in the revival of Zimbabwe’s mining sector, a Cabinet minister has said. The Minister of Mines and Development, Obert Mpofu, lamented the deterioration of a once thriving sector to "a pale shadow of its true potential".

Mpofu was speaking at a recent workshop at the Harare International Conference Centre, in Harare.

"Indeed Zimbabwe is undergoing various transformations on the socio-political and economic aspects of its operating environment," he said.

"These ongoing economic and political reforms are positive developments on the operating environment that will enable viability of the mining sector and the national economy in general."

Gold production had fallen from 25 000 tonnes in 1999 to 5 000 tonnes in 2008. Copper and chrome, among other minerals, were no exception to this decline.

Minister Mpofu said the creation of an inclusive Government, the consolidation of which is going on, and positive reforms and liberalisation of several economic aspects — such as exchange rates and monetary policy in general — and the evaluation and proposed amendment to the mining legislation, would aid economic recovery.

Minister Mpofu said the country’s business operating environment was set to improve.

The environment was a dynamic aspect that needed continuous interventions to enable the Government, investors and the community to accrue sustainable mutual benefits.

Output in gold, platinum and other metals in that group had declined and many precious stones had been on a downward trend ever since.

At one time Zimbabwe was the third largest producer of gold in Africa.

Recent statistics reveal trends of a free fall in an industry with potential to drive the economy.

Research carried out had shown that whilst the country was sitting on an estimated 13 million tonnes of gold ore, it managed to produce

3 072 tonnes in the year to December 2008 as compared with 6 790 tonnes the previous year.

This slump is mainly attributed to under utilisation of existing mines.

In 2007, gold output declined by 33 percent. This is an output of about 7,5 percent whilst for the same year chrome was expected to decline by 12 percent with phosphates declining by 15 percent.