Zimplats profits up 170 percent
30/04/2012 00:00:00
by Reuters
ZIMPLATS reported a 170 percent jump in third-quarter profit on Monday, buoyed by higher platinum prices. Zimplats said January to March
operating profit rose to $52 million from $19 million the previous quarter. Revenue, at $128 million, was 32 percent higher than the last quarter.The company said production dropped by two percent to 90,557 ounces after an illegal strike by some workers and electricity cuts, which affected operations at the mine's platinum matte furnace.
"In addition, the operations were put under power load shedding from 9 March to 23 March 2012 resulting in the furnace operating at less than half its capacity," the company said in a statement.
A planned maintenance shutdown reduced ore milled by 4 percent to 1.1 million tonnes.
Implats, which owns 87 percent of Zimplats, said in March it had agreed to a deal that would see it comply with Zimbabwe's requirement that 51 percent of shares in Zimplats be held by locals.
"The 51 percent Indigenisation Plan for the operating subsidiary, Zimbabwe Platinum Mines (Private) Limited, was agreed in principle with the Government of Zimbabwe," the company said.
"Discussions are now on-going regarding finalisation of an implementation plan."
Labels: IMPALA PLATINUM, PLATINUM, ZIMPLATS
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More editorialising from Reuters - why does the empowerment law or land reform have to be preceded by the standard "controversial"? Also, it is clear again that the neoliberal MDC are the sell-out party. From Anglo-American miner Morgan Tsvangirai, to 'human rights lawyer' and now neoliberal economist Tendai Biti, not to mention all the former Rhodesian Front members among their ranks, they are staunch defenders of elite corporate interests over the interests of the Zimbabwean people.
Indigenisation law ‘absurd’: Biti
19/04/2012 00:00:00
by Business Reporter I Reuters
THE government's drive to force foreign businesses to give 51 percent of their shareholding to locals will benefit the few black elite and
must be reviewed, Finance Minister Tendai Biti said on Thursday.
The controversial empowerment law is already being implemented in the mining sector, where South Africa's Impala Platinum was forced to hand over majority shareholding in its Zimplats unit to a state fund, employees and local communities.
Speaking at the Atlantic Council, a think tank and public policy group, Biti said while he agreed on the need for Zimbabweans to participate in the broad economy, the initiative being spearheaded by President Robert Mugabe's Zanu PF party would only benefit the black elite.
"The transfer is for value, which is good, but in a situation where the majority are poor, you are just transferring shares from a few rich white people to a few rich black people," said Biti.
"It wasn't well thought. Due process not being followed, we need to go back to the drawing board and say how can we empower our people.
“The best way to empower our people at this present moment in time is to expand our economy to create as many sectors as possible."
The exercise is widely seen as a ploy by Zanu PF to win votes in elections that must be held by next year with political reforms and a new constitution in place.
[Widely seen by whom? The MDC? Based on what evidence? - MrK]
The government, which plans to have completed the empowerment program in the mining sector by the end of this month, has given no indication how much it plans to pay for any stakes in Zimplats.
Zimbabwe has the world's second largest platinum deposits.
There is also pressure on the four foreign banks to hand over 51 percent of their shareholding, which is being vigorously opposed by both Biti and central bank governor Gideon Gono.
Illustrating what he said was the "absurdity" of the empowerment program, Biti said the four banks - which include Britain's Barclays and Standard & Chartered - have an average market capitalization of $60 million each.
To start a bank in Zimbabwe, the minimum capital requirement is $12.5 million, which means that anyone buying 51 percent of any one of the banks' shares would need to pay about $30 million.
"If you have $30 million, why not just start your own bank? The program has not been well thought out. ... How we are trying to do it is a disaster."
Empowerment Minister, Saviour Kasukuwere recently said he would now target the financial services sector after forcing the major mining companies to comply with the controversial law.
However, Biti and Gono have warned that applying the 51 percent quota to banking could adversely impact the country’s economic recovery.
Labels: IMPALA PLATINUM, MDC, TENDAI BITI
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The risk of indigenising banks
By Lance MambondianiBanking, Companies, Money, Stock Market Last updated on: April 13, 2012
A YEAR ago, David Brown – the head of Impala Platinum – believed Zimbabwe’s indigenisation plans for foreign-owned mines “would not happen”. The policy, which required all companies with a share capital above US$500,000 to arrange for 51 percent of their shares or interests to be owned by indigenous Zimbabweans, was taken as a bit of a joke, a populist policy by the government to win votes ahead of the elections. It’s not so funny now.
In the words of former US president George Bush, Brown “mis-underestimated” the government’s blind determination. When Zimplats – the world’s second largest platinum producer – announced recently that it would transfer 51 percent of its shares “at an appropriate value”, there could have been no bigger scalp for Saviour Kasukuwere, the Minister of Youth Development, Indigenisation and Empowerment. After this, Brown announced his retirement from the platinum group.
Together with Mimosa mine, Zimplats accounts for over 40 % of the London-listed Impala’s global platinum reserves, a priced asset by any standard and a major victory for the government’s indigenisation crusade. The kind of victory that makes you believe you can pump your car tyres into a monster truck.
Buoyed by the Zimplats success, the minister has turned his attention to the banking sector and a possible showdown with Barclays and Standard Chartered – Zimbabwe’s oldest banks established over 100 years ago at the height of colonialism. If it were a stunt, it would be one of those suicidal junkets which the feint-hearted cannot stand to watch. You want to close your eyes and ask after – did he really do it? If successful, it would cheer the crowd, a slip-up would be terminal.
[But only if you're a coward. Remember all the cries of disaster when the land was redistributed. They were wrong, self serving, and attempting to sabotage a real revolution. - MrK]
Banks are ‘special’
The prospect of indigenising the banking sector has ignited a war of words between Kasukuwere, who has found an unlikely ally in the Deputy Prime Minister Arthur Mutambara, and the central bank governor Gideon Gono who has also found an unlikely ally in the Minister of Finance Tendai Biti. The banking sector may yet be a stern test for the indigenisation policy, reflecting an ideological chasm between the ‘nationalists’ and the ‘free marketers’.
Legally, the Empowerment Act makes no sectoral distinction nor does it exempt the banking sector, but should it? Indigenising the banking sector, while possible, may not be as easy as the mining sector. Unfortunately for the minister, banks are special and their interconnectedness makes a systemic crisis contagious and very costly. A disruption at one bank could have a knock-on effect not only on the entire banking sector but the entire economy.
The importance of the financial sector and the need for stable banks cannot be underestimated. Banking is the business upon which all other businesses are based.
[Actually in any healthy economy, banking is merely an adjunct to the REAL economy, which is about growing food and manufacturing goods. Not banking or finance. - MrK]
Banks are at the core of the payment system in the country and play a primary role in the intermediation of savings and investments. Several empirical studies support the view that countries with efficient and strong financial and banking sectors experience higher rates of economic growth.
[Or that countries with high economic growth generate a sound banking system. - MrK]
Caution ... RBZ governor Gideon Gono and Finance Minister Biti
The RBZ Governor’s opposition to indigenising the banking sector seems to suggest a man who speaks with the benefit of experience following a spectacular failure of ownership changes after the 2003 banking crisis. Indigenisation would also reverse the core of the governor’s policies which have forced banks into seeking international partnerships to meet capital requirements which are seemingly disproportionate to the economy.
There is every possibility that a coercive change in bank ownership structure would again lead to a weakened banking sector. Indigenising banks in a highly illiquid sector seeking foreign capital seems quite irrational, particularly where the 51 percent is ceded “on credit”.
Whilst Zimplats looks like a done deal, the terms of the agreement suggests that the mining giant will “make available for sale” to the government a final 31% stake for cash “at an independently determined fair value”. The cash-strapped government which pays all its employees an average of $250 per month is yet to agree to this because the money isn’t there.
Lessons from other African countries
It appears there is an increasing trend towards indigenisation across Africa. This is premised on the idea that to achieve its economic potential within global capitalism, African governments will need to redress economic imbalances created by colonialism through economic policies such as indigenisation.
Several African countries have implemented indigenisation policies with less controversy or combativeness. There is the complicated and non-prescriptive BEE law in South Africa and the approach in Ghana which proposes that local participation in the oil and gas sector be increased to 80 percent by 2020.
Other indigenisation approaches include the sectoral approach in Angola, where locals must hold 51% of the share capital in mining and telecommunication companies and 30% in insurance enterprises. In Kenya, the law requires that at least 20% of company shareholding in the telecoms sector must be taken up by Kenyans and in insurance, whilst listed companies must reserve at least 25% to locals.
The different prescriptive, non-prescriptive and sectoral approaches to indigenisation across the region can be analysed to inform best practice. Whilst indigenisation is imperative and by all accounts unstoppable, we don’t always have to be combative where there are tested options.
A flexible alternative
Following challenges previously experienced with the Land Reform programme and the concerns raised by the private sector, a critical appraisal of the indigenisation policy and its effect on the economy will need to be undertaken. Regional and international best practices will need to be analysed. A consultative process between stakeholders will also be useful.
Technical assistance from international financial institutions will also be important to inform a robust and effective indigenisation policy. The impact of the policy on foreign direct investments would need analysing. Although Zimbabwe’s economy is growing again, foreign investors are needed to ensure sustained growth. The damage which can be caused by a combative policy cannot be underestimated.
An alternative for the banking sector may require a less rigid, sector-specific approach which factors in the intricacies of banks. Whilst Kasukuwere may yet be victorious in a showdown with the international banks, the risk may have a destabilising effect on an economy limping out of a decade-long crisis.
Dr Lance Mambondiani is an Investment Executive at Coronation Financial. He is also a Teaching Assistant in International Finance for Development and Financial Markets and Corporate Governance at the University of Manchester. The view expressed in this articles are personal and do not necessarily reflect the position of Coronation Financial
Labels: GIDEON GONO, IMPALA PLATINUM, INDIGENIZATION AND EMPOWERMENT ACT (ZIMBABWE), SAVIOUR KASUKUWERE, TENDAI BITI, ZIMPLATS
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Implats may set up Zimbabwe refinery
10/04/2012 00:00:00
by Business Day
PLATINUM producer, Zimplats is reported to have agreed to set up a refinery in Zimbabwe as pressure mounts on platinum producers to beneficiate minerals inside the country.
Zimplats deputy chairman Muchadeyi Masunda said the company had committed to setting up a refinery in Zimbabwe.
"Despite all that has happened … the smelter and refinery project is on course." Current production levels are considered too low to sustain a refinery. The platinum output of the top platinum producers in Zimbabwe is below 500000oz.
However, Zimplats has revealed that it intends to ramp up its output to 270000oz from 180000oz after the successful implementation of its phase two expansion project.
Mimosa, jointly run by Implats and Aquarius Platinum, on the other hand, is planning to double its production to 200000oz a year from 100000oz.
Masunda said Zimplats "initially set aside $500m for the beneficiation project" and was assessing "the kind of infrastructure required" for the refinery.
He said it was necessary for Zimplats to "be assured of adequate stockfeed going forward".
Zimbabwe’s decision to push the beneficiation of raw materials is based on job preservation and creation.
However, Amplats CEO Neville Nicolau has previously said platinum miners could look at setting up an "industry refinery" in Zimbabwe in about five years.
Zimbabwean analysts emphasised that Zimplats would require about $2bn to set up the refinery, which "would be difficult under current conditions" that are fraught with legislative hurdles.
Others said, however, that Zimplats could agree to set up the refinery under phase three of its expansion project.
This comes as Zimbabwean officials said last week that the government was looking into complaints by the mining industry that ground rentals, fees and taxes would curtail production and drastically reduce profitability.
"The ministry is presently reviewing the impact of these fees on the mining sector," mines ministry permanent secretary Prince Mupazviriho was quoted saying.
Zimbabwe hiked pre-exploration fees for most minerals by as much as 8000% in January, while registration charges for platinum and diamond claims rose to $2,5m and $5m, respectively.
Labels: IMPALA PLATINUM, INDIGENOUS DIAMOND BENEFICIATION STRATEGY, MUCHADEYI MASUNDA, PLATINUM, ZIMPLATS
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State now owns ‘all’ foreign mines: Kasukuwere
05/04/2012 00:00:00
by Nelson Banya I Reuters
THE government raised the stakes on Thursday in its drive to wrest majority control of foreign mining companies, with a minister saying the state now considered it owned 51 percent of firms that have not complied with local ownership laws.
“All mining companies that have not complied … should note that 51 percent of their shareholding is now deemed to be owned by the state,” empowerment minister Saviour Kasukuwere said in a statement.
It was not immediately clear which firms were being targeted, or whether President Robert Mugabe’s cash-strapped government planned to pay for the shares. Kasukuwere did not respond to requests for clarification.
The demand for foreign companies, particularly miners, to transfer a 51 percent stake in local operations to black investors is widely seen as a tactic by Mugabe’s ZANU-PF party to raise cash for elections that may come this year.
Johannesburg-listed Impala Platinum, the world’s second-biggest platinum producer, bowed to pressure last month to surrender half its Zimplats unit, although details of the transfer have not yet been worked out. Analysts said this latest broadside from Kasukuwere might be more bluster than fact.
“I would treat this with quite a degree of scepticism,” said Nic Borain, an independent political analyst based in Cape Town.
“I would want to wait to see the specifics of how those shares would be transferred, how the assets would come to be in government hands, how government would exercise any control over those assets.”
The statement added that any profits accruing to the 51 percent stakes “should be regarded as property of the state”, and that other companies transacting with mining firms should remember that they are dealing with the government.
“Any attempt to defraud the state will result in prosecution,” it said.
Kasukuwere has previously said most major firms have complied or are in the process of complying, but he has not publicly endorsed plans relating to leading gold producer Metallon Gold, an unlisted South African miner, and Mwana Africa’s Bindura Nickel corporation.
Harare says its “indigenisation” policy is needed to redress the racial inequities of past colonial rule, but similar drives in other sectors have been disasters, most notably the government’s seizure of white-owned farmland that decimated commercial agriculture and led to widespread food shortages.
Labels: IMPALA PLATINUM, INDIGENIZATION AND EMPOWERMENT ACT (ZIMBABWE), SAVIOUR KASUKUWERE
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Government, Implats showdown looms
Saturday, 31 March 2012 23:43
Makomborero Mutimukulu
Deputy News Editor
Government and Implats could be headed for a major showdown following indications that the Johannesburg Stock Exchange-listed mining group will play hard ball over the transfer of a controlling stake in Zimplats to locals.
While everything seemed on course when Youth Development, Indigenisation and Economic Empowerment Minister Cde Saviour Kasukuwere and Implats chief executive Mr David Brown agreed on an indigenisation plan last month, recent developments have seen Zimplats’ parent company constantly shifting goal posts.
Mr Brown recently told an investors’ briefing in South Africa that Implats will only transfer a 31 percent stake in Zimplats to the National Indigenisation, Economic and Empowerment Board after receiving “fair cash compensation”.
The remaining 20 percent of the controlling stake Implats has agreed to hand over to locals will be shared equally among the company’s workers and the Community Share Ownership Trust.
However, Government maintains that it will not pay for resources that rightfully belong to the people of Zimbabwe.
Cde Kasukuwere yesterday said: “The fact of the matter is we are taking our resources and there is no need for us to concentrate on the trivial. What (Mr) Brown said or did not say does not change what we are doing here, which is taking our resources for the benefit of the majority.”
Mr Brown hinted that Implats only agreed to the deal so as to “take the heat off their backs” and was now looking at ways of getting the best of what he termed an “in-principle agreement”.
“We recognise that there is obviously quite a lot of water to flow under this particular bridge and, effectively, what we are trying to do now is to take some of the heat out of the angle that the Government was coming from in terms of our non-compliance with the law and accusations that we were being disrespectful and we were not being good corporate citizens,” he was quoted as saying.
“In essence, the in-principle agreement has taken a lot of that sting out of the relationship and we can now start to look at some of the detail but in a much more convivial atmosphere than previously.
“The impression created that we did not want to comply with Zimbabwe’s laws did put us in a difficult position with regard to our ongoing investment in Zimbabwe.”
Mr Brown was optimistic his company would emerge better from the arrangement.
“I believe that we have found an element of common ground and that we have a workable solution as the Government does understand that the recognition of appropriate value is essential.
“We will look to the discussion and, on execution; we believe that Zimplats will have met all the Government’s indigenisation and empowerment requirements.
“That will leave us in the very positive position of having received value for the sale of stakes, but, at the same time, not prejudicing Zimplats’ medium- and long-term growth aspirations in Zimbabwe,”
At the current market value, the 31 percent stake that Implats is supposed to transfer to the National Indigenisation and Economic Empowerment Board (NIEEB) is worth US$350 million.
However, the mining concern reckons its stock is undervalued and expects Zimbabwean authorities to part with close to US$500 million. Mr Brown also ruled out the possibility of having the NIEEB getting vendor finance to purchase the equity.
Vendor financing is a business transaction whereby a company lends money to a borrower for the purchase of its products or property.
Apart from a “fair value cash payment”, Implats also looks set to demand compensation for the platinum-bearing ground, worth US$153 million.
It claims to have voluntarily returned the ground to Government in 2006 in return for empowerment credits.
The group also claims it did not receive the credits with Mr Brown insisting any negotiations on the 31 percent stake will only commence after they get a US$153 million cash compensation.
“We are prepared to forego credits provided we receive adequate cash compensation in the equation and that the overall package is fair from a value perspective.
“If 31 percent is sold at value and Implats gets US$153 million; that would be an attractive outcome,” the Implats boss told the media and analysts’ conference.
And in a move that is likely to see the company regaining its controlling stake if Government does not stand firm, Implats is adamant that the Zimbabweans who will hold a controlling stake in Zimplats will have to fund the mining concern’s expansion programme.
Failure by the shareholders to follow their rights will see their 51 percent stake being heavily diluted.
Asked on what would happen if the Government maintained its stance of not paying for equity, Mr Brown said Implats would seek protection from the South African government, which has a bilateral trade agreement with Harare.
“We have been having conversations with the South African government on this because, obviously, they have a keen interest in what is happening.
“The treaty covers fair compensation and, obviously, if there was no fair compensation, then we would have alternative processes that we could explore.”
Labels: IMPALA PLATINUM, INDIGENIZATION AND EMPOWERMENT ACT (ZIMBABWE), ZIMPLATS
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Minister rules out payment for Zimplats
Standing firm ... Saviour Kasukuwere and President Robert Mugabe
02/04/2012 00:00:00
by Gilbert Nyambabvu
A CABINET minister has insisted that Zimbabwe will not pay for the 31 percent stake in platinum miner Zimplats which is set to be transferred to locals under the country’s economic empowerment programme.
South Africa-based Impala Platinum, the world's second largest platinum producer and the biggest foreign investor in the country, last month bowed to Zimbabwe's pressure to surrender a 51 percent stake in its Zimplats unit, a cave-in that followed months of wrangling.
Under the deal 31 percent is nominally earmarked to go to the National Indigenisation and Economic Empowerment Fund, a further 10 percent will go to local communities and 10 percent to Zimplats employees.
However, Implats says the Zimbabwe must pay cash for the 31 percent stake, which at current market value would be worth about US$350 million.
Implats also says its stock is presently undervalued and reckons the government may have to pay up to US$500 million for the shareholding.
"If they don't come up with the cash the stake will not be transferred," Implats chief executive David Brown said in a recent interview.
But Empowerment Minister, Saviour Kasukuwere said Zimbabwe would not pay for its natural resources.
“The fact of the matter is we are taking our resources and there is no need for us to concentrate on the trivial,” Kasukuwere told the Sunday Mail.
“What Brown said or did not say does not change what we are doing here, which is taking our resources for the benefit of the majority.”
Still, Brown said if Zimbabwe refuses to pay his company could seek protection from the South African government under the investment protection agreement between the two countries.
“We have been having conversations with the South African government on this because, obviously, they have a keen interest in what is happening,” he said.
“The treaty covers fair compensation and, obviously, if there was no fair compensation, then we would have alternative processes that we could explore.”
Implats also expects the government to pay another US$158 million for mineral reserves released to the government under a prior agreement.
The stand-off over Zimplats ownership may imperil at least $1 billion in expansion projects at the company as well as plans by Implats to set up a metals refinery in the country.
Labels: IMPALA PLATINUM, INDIGENIZATION AND EMPOWERMENT ACT (ZIMBABWE), PLATINUM, ZIMPLATS
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COMMENT - " The four diamond mines in Marange have contributed to the fiscus in their first three years of operations more than double of what all the
Anglo-American, De Beers, Lorhno [Lonrho], Rio Tinto, Ashanti and Zimplats mines have paid into the fiscus since the arrival of the Pioneer Column. NANGO must now re-direct its firepower accordingly." If you look closer into the ownership of these companies, you will find there are only a few who own their shares. Which should tell you all you need to know why there has been a decade long global hate campaign against the country of Zimbabwe.
For instance, Anglo-American was founded by sir Ernest Oppenheimer and John Pierpont Morgan, De Beers was originally financed by NM Rothschild, Rio Tinto is owned by NM Rothschild, Zimplats is owned by Implats whose CEO David Brown was an executive at Rothschild South Africa as was the CFO for Implats' Zimbabwean Kameni project. All roads lead to the Rothschilds. This is not an anti-semitic observation, it is about simple analysis of what is going on. I can completely undertand how someone would mistake this for anti-semitism, because you have to wade through yards of anti-semitic material to find the facts, including strange demonisation that sounds like the writings of a paranoid-schizophrenic (glowing eyes, really), and unconfirmable allegations about secret societies. Much of which can even be a smokescreen thrown up by the Rothschilds themselves. So let's not allow them to hide behind 'the Jews', 'Wall Street' or 'bankers' in general again. This is all about the Rothschild family and their business practices.
I haven't found what the Rothschild link to Goldman Sachs is, but like Goldman Sachs, they specialize in ripping off their customers ('muppets'), cheating on taxes and leaving no value 'on the table', to use a gambling metaphore. Anglo-American De Beers was the core of economic activity in South Africa before, during and after apartheid. When the talk was of 'defending capitalism' and 'fighting communism' in reality this meant the protection of Anglo-American De Beers as a privately owned company, instead of a state owned company. They are behind the destruction of the Zimabwean currency through financial manipulation (Section 4C of the Zimbabwe Democracy and Economic Recovery Act of 2001), in order for AADB to get it's hands on Zimbabwe's diamond and platinum reserves.
Marange: It’s now time for NGOs to move on
By Tafadzwa Musarara
Last updated on: March 22, 2012
“Mr. Chairman, I say with authority that the Zimbabwe government have and will never treat the Marange diamond fields classified and shut it from any well meaning persons or organisations. It remains my government’s pledge to give access to the civil society.
“Further, Mr. Chairman, I would like to remind fellow plenary participants that it is the Zimbabwean government that proposed the roadmap in Swapokmund for the certification of our mining operations in Marange which include, inter alia, cooperation with progressive civil society.”
Obert Mpofu addressing the Kimberly Process 2010 Jerusalem Plenary.
This statement reverberated in my mind as we negotiated the dusty and steep road into the Marange diamond fields during the civic society tour of the facility on March 7, 2012.
This trip was historic because it was the first official visit into the famous diamond fields by all members of the civic society including my brother and friend Farai Maguwu, who had won European awards for reporting on the “human rights abuse” and the “opaque mining operations” by Mbada and Marange resources.
It was also historic that the National Association of Non Governmental Organisations’ (NANGO) former KPCS focal committee members were seeing the operations for the first time together with all other civic groups that had not made reports about the goings on in this world’s most potent diamond deposit valley.
Personally, I anticipated that Maguwu, whom I was paired with, was going to tell me more about the operations given his reports on the area that made world headlines and caught the attention of Downing Street and the White House. Unfortunately, the brother was blank!
The dispensation granted by Mpofu to allow civic society access to Marange diamond fields is also in compliance with KP’s administrative decision which states that, “KP civil society coalition representatives in Zimbabwe will have access to the Marange area so as to allow continued reporting on KPCS implementation.”
The aim and objective of this trip was very clear: to allow civil society to see and assess the diamond extractive processes by the four mines, namely Mbada Diamonds, Marange Resources, Anjin and DMC. Accordingly, the top management of the mines took us around and fielded questions from the media and civic society.
The visit also confirmed that indeed the four companies earned the KP certification. Without any doubt, no diamond operations in the world has more sophisticated and state-of- the art artillery like what we saw. The closed camera population per square meter outnumbers that of the Big Brother TV show.
The ore is guarded by armed guards, police’s CID unit, camera monitoring rooms both in Marange and in Harare. The electric fence forms a thick forest that bars illegal miners from entering the designated diamond fields. The body searches both manual and electronic are just thorough and you have to hide any charms that might be in your person because nothing is sacred.
I was privileged to be chosen to get into the sorting rooms to see the diamond stones being sorted. The process is so complex that even the sorter cannot touch the stones with bare hands. The stones are dropped into a special can, which will shut when full and can only be opened in Harare. When violated, the can will lock and cannot be force opened whatsoever.
We also noticed that the entire Marange area had demilitarised in compliance with the KP administrative decision of 2009 as we noticed that private security personnel were in charge of all security arrangements. No cases of beatings by the military were recorded in the 18 months and this was also vouched by Tiseke Kasambala of Human Rights Watch during her interview with the CNN.
The relocations of the families in Chiadzwa to Arda Transau exceed the minimum requirements of the United Nations Vancouver Declaration Human Settlements 1803. The relocation saw families move from a semi-arid region to an area which falls under region two endowed with arable land and much better rainfall patterns. The houses built are spacious and meet the demanding needs of polygamous settings. All the sons of these families will also benefit from the scheme, as they will also have their own houses built for them upon marrying.
The entire civic society groups that went on this tour knew before the tour that the event was a guided one. The Marange diamond fields are protected areas in terms of the law and you cannot expect anyone to be allowed to have free reign.
The NANGO civil society groups issued a press statement in less than 24 hours after end of the visit. How discourteous! Having been allowed by government of Zimbabwe access into the Marange Diamond fields to asses on their own the extractive operations, NANGO must have submitted their report to the Ministry of Mines highlighting their concerns and observed the audi alteram partem rule. Yes, hear the other side before making your charges public.
This unfortunate character of some of the western-funded organisations not to afford the other side or the “accused” the right of reply was epitomised by Farai Maguwu who alleged that there was mass killings in Marange sponsored by the diamond mining companies without giving them opportunity to respond.
“I want to put it on record, Mr. Chairman, that the civil society movement in Zimbabwe has been sadly hijacked by some of our mediocre brothers who have never excelled in life and want to feast on crisis creation in Zimbabwe. Facts fabrication is their specialty. We will defeat them intellectually,” said Mpofu at the Jerusalem conference.
The four diamond mines in Marange have contributed to the fiscus in their first three years of operations more than double of what all the Anglo-American, De Beers, Lorhno, Rio Tinto, Ashanti and Zimplats mines have paid into the fiscus since the arrival of the Pioneer Column. NANGO must now re-direct its firepower accordingly.
Tafadzwa Musarara is the chairman of Resources Exploitation Watch. Can be contacted on musarara@yahoo.com
Labels: ANGLO-AMERICAN, DEBEERS, IMPALA PLATINUM, MINING, ZIMPLATS
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Kasukuwere OKs Mimosa ownership plan
22/03/2012 00:00:00
by Reuters
ZIMBABWE has accepted a proposal by Impala Platinum's joint venture with Aquarius Platinum to turn over a majority stake to locals, a government minister said on Thursday.
Empowerment minister Saviour Kasukuwere said Mimosa mine outside Harare, a 50-50 partnership between Implats and Aquarius, will transfer 10 percent each to workers and local communities, 6 percent to state employees and 25 percent to a state fund.
"They have submitted a compliant 51 percent plan. It has since been submitted to the ministry which has been accepted," Kasukuwere told reporters on the sidelines of an investment conference.
The proposal comes more than a week after Implats bowed to Harare's demands that the world's second largest platinum miner transfer a similar stake in its Zimplats operation to locals.
Implats has said the Zimbabwean government would have to pay for the shares it wants.
On Thursday Kasukuwere said the agreement with Implats should include an evaluation of assets and resources owned by Zimplats but he did not give further details.
"At the end of the day we want a win-win situation. We need a fair share of what is due to us," he said.
Kasukuwere has previously said the cash strapped government would not pay for shares in mines, arguing that it already owned the mineral resources in the ground.
Zimbabwe, with the second-largest known platinum deposits in the world after South Africa, is seen as a growth area for the platinum sector.
Labels: IMPALA PLATINUM, INDIGENIZATION AND EMPOWERMENT ACT (ZIMBABWE), PLATINUM, SAVIOUR KASUKUWERE
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COMMENT - Isn't it great? :) Those 'analysts' need to declare their financial interests. It is almost touching how they call the PM 'Morgan', and tell the world how much he loves Anglo-American Corporation. :))) All the 'hate Mugabe' propaganda of the last decade has been nothing more than the fear of losing the transnational corporation's (Anglo-American De Beers, for instance) death grip on Africa's resources. And using their positions in the international media to make this campaign happen.
And isn't Reuters supposed to be an independent news agency? Oh I forgot, they are owned by the same people who are the largest single shareholder in Anglo-American De Beers, the world's largest diamond miner, and Zimbabwe owns 20% of the world's known diamond reserves.
The very same family that also owns Rio Tinto, and it's Murowa
diamond mine. Feel the radicalism. ;)
Zanu PF buoyed by Implats capitulation
14/03/2012 00:00:00
by Reuters
THE capitulation of a major platinum miner to Zimbabwe's demand to hand over a majority stake to local black investors will
embolden President Robert Mugabe's Zanu PF party to pressure other foreign companies ahead of elections expected this year.[Right, because 51% ownership of foreign corporations in Zimbabwe and them paying taxes is all about paying for the next elections. Poor Zimplats. - MrK]
Other miners are likely be
targeted to
fill Zanu PF election campaign coffers while the policy will be
wrapped in the flag of liberation and portrayed as a hammer blow to the last remnants of white colonial rule, analysts said.
South Africa-based Impala Platinum, the world's second largest platinum producer and the biggest foreign investor in the country, bowed on Tuesday to Zimbabwe's pressure to surrender a 51 percent stake in its Zimplats unit, a cave-in that followed months of wrangling.
Platinum's spot price has been soaring and shot past gold on Tuesday.
Mugabe, 88 and in power since Zimbabwe gained independence from Britain in 1980, and top Zanu PF officials have been hit with international sanctions after being accused of using political violence to stay in power.
[The country and government were hit with economic sanctions in 2001, which came into force in 2002, called the Zimbabwe Democracy and Economic Recovery Act of 2001. - MrK]
One of Africa's longest-serving leaders, Mugabe is pushing for elections this year,
[The dictator! The despot! How dare he push for elections? The humanity. - MrK]
one year ahead of schedule,
[Ahead of whose schedule? The MDC's? Downing Street's? - MrK]
arguing the unity government he formed with Movement for Democratic Change (MDC) leader Morgan Tsvangirai after a violent 2008 vote has broken down.
"This is more about Zanu PF not having ready access to cash ever since the MDC took control of the finance ministry," said Tara O'Connor of Africa Risk Consulting.
"And dollarisation (of the economy) has taken away Zanu PF's ability to print money and decimated the power of the central bank. They are strapped for cash and the mining industry has become the next target to fund the Zanu PF patronage system," she added.
[Which is really what dollarisation (or euro-isation) were all about - taking the power to regulate the money supply away from national governments. - MrK]
Zanu PF has been criticised over the past decade for patronage when seizing white-owned farms. Many farms are now in the hands of party loyalists instead of the landless black peasants who were supposed to benefit.
[And we all know the veracity of those claims. Over 200,000 families have received land under the Fast Track alone, another 150,000 under the Willing Buyer, Willing Seller program before it. The slur was that land went from 6,000 white farmers, to 5,000 'friends and cronies of Mugabe'. The entire Economist financed hitjob called 'Mugabe And The White African' is based on that premise. However, if you read Prof. Ian Scoones book, based on an actual survey of 400 farms, only 3% of recipients in Masvingo Province could be described as connected to the security state or ZANU-PF leadership - 'friends and cronies of Mugabe', as the slur goes. Also see from this article here: Myth 2: The beneficiaries of Zimbabwean land reform have been largely political ‘cronies’ This is the data from AGRITEX/World Food Program/Food and Agriculture Organisation:
OLD RESETTLEMENT (WBWS): 159,985
FAST TRACK
A1 145,000
A2 29,902
SMALL SCALE COMMERCIAL FARMERS
29,902
LARGE SCALE COMMERCIAL FARMERS
920
Source: AGRITEX, World Food Programme, Food and Agriculture Organisation (UN); table 2. Agricultural land utilization pattern, 2006/07
And this is the data for 5 years ago, even more people have been resettled today. - MrK]
Analysts said the big winner from the Implats move was Empowerment Minister Saviour Kasukuwere, a Zanu PF stalwart, while MDC leader, Prime Minister Tsvangirai, was a clear loser.
Victory
"It will be construed as a big political victory for Mugabe and Zanu PF and defeat for Tsvangirai who has been saying such actions will hurt the economy," said Tony Hawkins, a professor at the University of Zimbabwe's Graduate School of Business.
[And how old is the geriatric rhodesian Tony Hawkins, now age is an ok issue to condemn candidates by? - MrK]
"The guys (Zanu PF) will have certainly been emboldened and will look to extend this to the other mines," he said.
Other companies in the firing line now include Mimosa, a 50-50 joint venture between Implats and Aquarius Platinum , and Rio Tinto's Murowa diamond mine.
Zanu PF has also been accused of profiting from the Marange diamond fields, where human rights groups estimate
[Estimate based on what? The same way they 'estimated' thousands of deaths during the last election? - MrK]
at least 200 artisanal, or small-scale, miners were killed in 2008 when Zimbabwe's security forces seized the workings. Mugabe's government has denied this.
The valuation of the Implats stake transfer has not been worked out and the murkiness surrounding the agreement has raised questions about where the funds will really go.
But 31 percent of the total is nominally earmarked to go to the state's National Indigenisation and Economic Empowerment Fund, which is Zanu PF-controlled. Ten percent will go to local communities and 10 percent to Zimplats employees, according to the agreement announced by both sides.
The nationalisation drive also plays to the narrative Zanu PF wants to weave for the election: the black liberation movement recovering assets seized by white colonialists.
[Apparently that is more than 'a narrative'. More editorialising by Reuters' anonymous writer. - MrK]
"Mugabe is determined to show that he is the true Africanist taking back all the land and resources that whites have stolen. This is the image he wants to create," said Allister Sparks, a Johannesburg-based independent political analyst.
['A true Africanist'? Interestingly, Ben Freeth (Mugabe And The White African) equated Pan-Africanism with 'this hatred of the white man you have'. Pan-Africanism is the 'racism' they are talking about when they accuse Africans of 'being racist'. - MrK]
In contrast, Zanu PF has persistently portrayed Tsvangirai, a former miner, as a puppet of white capital.
"Morgan loves the mining industry because he was a miner and was given his start in life by Anglo American. He is a miner at heart but he sees both sides of the picture and this policy is not good for the workers or investors," said Tsvangirai biographer Sarah Hudleston.
[In fact, 'Morgan' loves Anglo-American so much, that he and his MDC helped to draw up the Zimbabwe Democracy and Economic Recovery Act of 2001, which destroyed the Zimbabwe Dollar from Jan. 1st 2002 onwards. Even though it ended up killing thousands of Zimbabweans from preventable diseases. Yes Sir, Morgan Tsvangirai loves Anglo-American. - MrK]
Control
The ruling Zanu PF welcomed the Implats decision. "We are absolutely delighted. We have said this time and again, that we need to control our economy and resources," said spokesman Rugare Gumbo.
"The opposition (MDC) has no programme. I do not take them seriously, they don't understand the dynamics of liberation and they are just parroting their masters' line of thinking," Gumbo added.
Zimbabwe is not the only African country that is pushing for a bigger share of state ownership in resources and so the Zanu PF nationalisation march can also be portrayed as part of a wider Africanist agenda.
[No, really? So it may not be all about financing the next elections? - MrK]
But while mineral-rich countries from South Africa to Ghana are trying to get a bigger slice of their resource pie, Zimbabwe stands out for its radicalism.
"Zimbabwe always provides us with an extreme example of things happening elsewhere. Resource nationalism is not unique to Zimbabwe, it is happening across the continent. But Zimbabwe is just taking it to extreme levels," said O'Connor.
COMMENTS
RG_M
Tara O'Connor, Allister Sparks, Sarah Hudleston, Tony Hawkins......Can anyone see how interesting the Rhodesians are no longer asking the MDC-T to talk on their behalf now? They feel betrayed by the MDC-T because ZANU PF is scoring major blow-out successes.
Re-read the article again critically and you will see how even Tsvangirai's photographer is diving into directly demonising ZANU PF......They know that ZANU PF's ambitious Empowerment drive is real and it will bring about proper and lasting wealth, lasting prosperity for Blackie!!!! The whole article by Ed Stobbart is very similar to an article on the Wall Street Journal today.
I think this is the time the nation needs to be on high alert.....I am convinced the Rhodesians are going to their PLAN B if those in the know know what I mean. These guys were quite convinced that Implats was not going to budge.....now this has opened the floodgates.
The tone from the many whites who have commented here is definitely angry....even more angry than sender52......now compare their tone to Tsvangirai's statement in the Herald today that sanctions must be removed completely because they are hindering economic progress. Conflicting stance from the MDC-T and their handlers......could this be evolution of the MDC-T?
Labels: ANGLO-AMERICAN, DEBEERS, IMPALA PLATINUM, INDIGENIZATION AND EMPOWERMENT ACT (ZIMBABWE), NEOCOLONIALISM, NEOLIBERALISM, RIO TINTO, RUGARE GUMBO, ZANU-PF, ZIMPLATS
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Zimplats agrees 51 percent ownership transfer
Shaking on it ... David Brown and Saviour Kasukuwere in Harare Tuesday
13/03/2012 00:00:00
by Nelson Banya I Reuters
ZIMBABWE and Impala Platinum, the world's second largest platinum producer, said on Tuesday they agreed on the transfer of a 51 percent stake in the company's local unit Zimplats to black Zimbabwean investors, as required by the government.
"Essentially we have found each other and that augurs well for the mining industry in Zimbabwe," Implats chief executive David Brown told a news conference after a joint statement confirmed the deal.
The agreement ends a war of words between the government and Implats over the ownership requirement, which had jolted investor confidence in the country and was widely seen as a populist tactic by President Robert Mugabe's Zanu PF party in the run-up to elections expected later this year.
It remained unclear how the cash-strapped Zimbabwean government would pay for the stake worth hundreds of millions of dollars.
The joint statement said the 51 percent would be broken down as follows: 10 percent to the community, another 10 percent to Zimplats employees and 31 percent to the state's National Indigenisation and Economic Empowerment Fund.
Empowerment Minister Saviour Kasukuwere told Reuters after the press conference:
"There's no deadline on when the finer details of the transaction will be worked out.
"The details are about the value. How do they value the shares? All that is to be worked out."
Labels: IMPALA PLATINUM, INDIGENIZATION AND EMPOWERMENT ACT (ZIMBABWE), PLATINUM, SAVIOUR KASUKUWERE
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Kasukuwere attacks Implats CEO
29/02/2012 00:00:00
by Reuters
A CABINET launched a verbal attack on Impala Platinum Chief Executive David Brown, saying on Wednesday he was
"sick and tired" of the mining group's failure to comply with local black ownership laws."The problem with Brown is that he talks too much. We are sick and tired of his delaying tactics," Saviour Kasukuwere, the minister in charge of Zimbabwe's black empowerment drive, told Reuters.
Implats is the biggest foreign investor in Zimbabwe's mining sector and has become the prime target of a government drive to get all outside companies to hand over majority stakes in their local operations to black Zimbabwean investors.
Brown has been seeking talks with Harare but told Reuters he was still in South Africa, where he is dealing with a strike at the company's Rustenburg mine that has cost it 2 billion rand ($265 million) in lost output.
"We can only engage him if he comes here to implement the law," Kasukuwere, a member of President Robert Mugabe's Zanu PF party, said.
This weekend, Harare gave Implats two weeks to surrender 29.5 percent of its Zimplats unit to a state-run fund and threatened unspecified sanctions if it did not comply.
Kasukuwere has previously threatened to cancel the mining licences of non-compliant firms.
Labels: IMPALA PLATINUM, INDIGENIZATION AND EMPOWERMENT ACT (ZIMBABWE), SAVIOUR KASUKUWERE
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'True leader' Malema addresses Implats strikers
STAFF REPORTER AND SAPA JOHANNESBURG, SOUTH AFRICA - Feb 28 2012 16:34
The ANC and striking mineworkers at Impala Platinum near Rustenburg must negotiate to end their strike, embattled ANC Youth League president Julius Malema said on Tuesday. "The employer must be prepared to negotiate. Negotiations means give and take," he said.
Malema was holding a consultative meeting with miners on working conditions in the mine and the nationalisation of mines in Freedom Park.
Over 17 000 workers were dismissed recently as a result of the strike that began on January 20, in a downing of tools that was sparked by rock drill operators who were protesting over the selective granting of pay hikes that saw them overlooked.
A system of bonuses and housing allowances effectively amounted to an 18% pay increase for a select category of workers whom the company claimed to be losing to high turnover. The strikers who were re-employed, were hired on condition of forfeiting their accrued benefits and other terms, which worsened their circumstances.
Chief among the striking workers' demands was a wage of R9 000 after deductions, compared to the current wage range of between R3 000 and R4 500.
Malema on Tuesday told the crowd that the mine could afford the workers' R9 000 wage demand or more.
Working conditions
"Workers cannot be wrong," he said to the applause of the crowd.
"Once workers decide on action something must be wrong."
He said the youth league had called for the nationalisation of mines based on the conditions mineworkers were exposed to.
"You must benefit from the mine. If you are not benefiting, you must fight until you benefit."
Malema told the protesters to return to work but said they should do so on condition that they would enjoy the benefits they had before the strike.
"You must not allow the employer to divide you," he warned.
North West Premier Thandi Modise accompanied Malema on stage and addressed the crowd.
"The ANC will never abandon you but you must be controlled -- no violence," she said. "You must always fight for your rights but you lose the support of government and the ANC when you are violent."
Resolution
Modise promised the workers that the impasse would be resolved by next week and that the ANC had arranged a meeting between the National Union of Mineworkers and Implats management.
Malema arrived under tight security, in a white Range Rover, while youth league spokesperson Floyd Shivambu arrived in a BMW, escorted by the police.
Malema arrived more than an hour late for the meeting, while the striking mineworkers sang liberation songs.
"A go lowe, ke leng re bua? [let's fight, how long have we been talking?]" the crowd sang when Malema had not arrived by 11am. He had been expected to address the workers by 10am.
Public order police held shields and batons as they watched the singing crowd near the stage. Four armoured police vehicles were standing by with their engines running.
Many workers said they regarded Malema as a "true leader".
"He is the one who can help us in our struggle," said Abbey Sibanyoni (48). "Malema is a true leader, that is why we want him to hear our problems," she said.
"With Malema we will win," said worker Kenneth Kubu (38), against the background of revolutionary songs.
The crowd waved placards calling for Malema to intervene in their strike.
"Our president Juju help us, we want money, not percent," read one placard.
Another read: "Next president of SA, we want money and nationalisation of mines."
-- Sapa, M&G Reporter
Labels: IMPALA PLATINUM, JULIUS MALEMA, LABOUR, SALARIES
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Implats must exit Mimosa: Kasukuwere
19/02/2012 00:00:00
by Business Reporter
THE Zimbabwe government wants South Africa-based Impala Platinum (Implats) to give up its stake in Mimosa Platinum, Empowerment Minister, Saviour Kasukuwere has said. In addition to majority control of Zimplats, Impala --- the world’s second largest platinum producer – also 50-50 joint owners of Zvishavane-based Mimosa Platinum Mine with Aquarius Platinum.
After complying with the country’s empowerment laws Impala’s interest in Mimosa would be reduced to about 24.5 percent but Kasukuwere said
even that left the company with too much control over the sector.
"Implats cannot be allowed to maintain a 24.5 percent portfolio investment in Mimosa while they have their hands full with the massive capital expenditure that will be required at Zimplats,” Kasukuwere told state media.
"They cannot have their cake and eat it too. They have to make space for Aquarius, as Mimosa is a very significant investment for Aquarius but is a drop in the ocean for Implats.
Kasukuwere said Impala’s exit would allow Aquarius to give greater attention to Mimosa since the company would become a major part of its asset portfolio.
"Having two minority shareholders splitting the non-indigenous 49 percent, with each holding 24.5 percent, will be very damaging for Mimosa, as the investment will become a portfolio investment for both Aquarius and Implats, and the company will be left without a shareholder of reference for funding and technical support,” he said.
“Neither of them (Impala and Aquarius) will be sufficiently incentivised to support any meaningful capital expenditure, and the company will not be able to embark on the next expansion phase to double production.”
Kasukuwere also added that having a single large majority shareholder would help Mimosa raise the US$300 million needed for an expansion programme expected to double output at the mine.
"Using a notional vendor financing structure to implement the indigenisation, with the support of a strong minority shareholder holding 49 percent, the company will be positioned to raise the required funding from some financial institutions, who have been sounded out,” he said.
"The financial institutions would only be interested in funding expansion capital, but they will not fund a buy-out of the existing shareholders. The funding would need to be injected into the operating entity as a loan, based on the feasibility study and the mining expansion plan."
However Mimosa managing director, Winston Chitando said changes in the company’s shareholding structure would not affect the expansion programme.
"We are planning phase six mine expansion and we have undertaken a feasibility study,” he said.
"The expansion would bolster revenue generation, profitability, operational costs and annual platinum output, which currently stands at 195 000 ounces per annum."
Labels: IMPALA PLATINUM, PLATINUM, SAVIOUR KASUKUWERE
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Impala Platinum CEO to step down
18/01/2012 00:00:00
by Reuters
THE chief executive of Impala Platinum, the world's second largest producer of the precious metal, is stepping down against the backdrop of a poorly performing share price and tough talks with Zimbabwe regarding its operations in the country.
Implats said in a brief statement on Wednesday that David Brown would depart as CEO with effect from June 30 in order to "pursue his own interests". Its share price extended losses on the day and was 3 percent lower at 1251 GMT. The company also said the board had identified a successor and was in the process of finalising the appointment.
Implats was the second-worst performing share among South Africa's benchmark Top 40 index in 2011, shedding 28 percent over the course of the year as the platinum price struggled.
It was a bad year in general for platinum producers. Implats' bigger rival Anglo American Platinum lost 23 percent in 2011 and Lonmin slid around 40 percent.
All platinum producers in South Africa, where about 80 percent of known global reserves are found, are grappling with rising costs and safety issues.
Brown's departure also comes at a sensitive time when the company is in talks in Zimbabwe over disputed royalties and a drive by the government to force foreign miners to surrender majority stakes to local black investors.
Brown had slammed the Zimbabwe moves last August in unusually blunt language, saying: "We believe that 51 percent equity just does not work."
Labels: IMPALA PLATINUM, INDIGENIZATION AND EMPOWERMENT ACT (ZIMBABWE), PLATINUM
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Zim doubles platinum mining royalties
26/11/2011 00:00:00
by Reuters
ZIMBABWE will double platinum royalties to ten per cent, the country's finance minister, Tendai Biti, has said. In an economy expected to expand by 9.3 per cent this year, mining and agriculture are the two biggest drivers, reports Reuters.
Biti said the mining sector has attracted $502 million of investment this year, despite plans to force mining companies to hand over a 51 per cent equity to local black investors.
He argued that in spite of growth in the industry, however, the government is not receiving enough in taxes and will hike royalties to seven per cent for gold and ten per cent for platinum.
"We don't feel that we are getting what belongs to Caesar vis-a-vis gold and platinum. I therefore propose to increase the royalties on gold and platinum ... in order to maximise the contribution of our minerals," Biti was reported as saying.
However, it is anticipated that further pressure on the mining sector could deter investment in the country, which has the world's second largest reserves of platinum.
"The economy, which is growing off a low base, could even grow by as much as 15 per cent. My biggest concern is on the mining royalties which are going to have a tremendous effect on mining operations, which are still recovering from a slump," economic analyst Eric Bloch told Reuters.
[More neoliberal nonsense from Eric Blochhead. - MrK]
In spite of these concerns, Impala Platinum recently confirmed that it will invest in a third expansion project at its Zimbabwe unit Zimplats to increase production to 360,000 oz/y of platinum.
Labels: IMPALA PLATINUM, PLATINUM, TENDAI BITI
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Zimplats denies tax evasion
Friday, 18 November 2011 00:00
Business Reporter
ZIMPLATS has dismissed claims that it owes the Government US$265 million in taxes and penalties not honoured to the State as contained in a report compiled by international audit experts Alex Stewart.
According to the auditors' report on Zimplats, the unpaid monies are comprised of US$70 million in unpaid additional tax profit, US$70 million penalty for late payment of tax and US$125 million interest for late payment.
In their
report submitted to the Reserve Bank in 2008, Alex Stewart International concluded Zimplats had neither computed nor paid additional tax profits between 2001 and 2007, as required in terms of the Income Tax Act.
ASI had undertaken the mineral export audit at the instigation of the central bank, in terms of Statutory Instrument 249 of 2006, on suspicion a number of mining firms had not honoured their tax obligations to the State.
It was feared that during the period investigated, the country could have been prejudiced by mining firms of more than US$400 million in unpaid taxes.
But the country's biggest platinum mining firm denies any delinquency in paying its dues to the State, rather it claims ASI's conclusions are riddled with errors.
"ASI computations were erroneous and, as a result, grossly overstated the amount that Zimplats was liable for. The correct amount was assessed and paid by Zimplats to the relevant arm of Government," said Zimplats.
Zimplats claimed ASI's initial computation showed a liability of US$70 million, but insists the errors in the computations inflated the amounts due.
"Apart from more fundamental errors on the interpretation of the provisions of the Income Tax Act, the computation has basic arithmetic and duplication errors, which have the effect of inflating the amount due."
The platinum mining giant added that a correction of "just three" of the errors reduced the liability, as per computations done by ASI, by US$30 million.
But a computation by tax experts engaged by Zimplats concluded the firm owed just over US$23,4 million and that this obligation had been fully paid.
The 87 percent owned unit of South Africa's Impala Platinum Holdings said the fact ASI were an international firm did not mean they were infallible or that their report alleging non-payment of taxes cannot be challenged.
Zimplats said "ASI computations were strewn with errors (arithmetic, duplication and misrepresentation of the Act)," resulting in overstatement of principal liability and that use of a 340 percent interest rate on US dollar liability was "incorrect and therefore the interest was overstated".
The errors were brought to the attention of both the RBZ and ASI, but the latter would not "unfortunately" act to correct them.
During a recent presentation before the Parliamentary Portfolio Committee on Budget and Finance, Reserve Bank of Zimbabwe Governor Dr Gideon Gono indicated there was no political will to take ASI's findings to a court of law for purposes of recovering the monies.
ASI has since taken the central bank to court claiming US$35 million, plus interest, for work they did but were not paid. The agreement had been that they would be paid a commission on the recovered taxes.
Labels: GIDEON GONO, IMPALA PLATINUM, MINING, PLATINUM, TAX EVASION, TAXATION, ZIMPLATS
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Platinum mines owe govt US$400 million
05/11/2011 00:00:00
by Business Reporter
THE government has accused the country’s leading platinum producers of
failing to remit close to US$0.5 billion in taxes as well as short-changing the fiscus by
banking profits in off-shore accounts. The allegations were made by Mines Minister, Obert Mpofu and his Finance counterpart, Tendai Biti during a pre-budget seminar held in the resort town of Victoria Falls.
Mpofu claimed that an audit carried out by an international firm had established that Zimplats and Mimosa platinum mines, both subsidiaries of Impala Platinum, as well as Anglo Platinum’s Unki development in Shurugwi owed more than US$400 million in unpaid taxes.
Mpofu said his ministry was signing export receipts of US$500 million per month, but remittances fell way below that figure with Biti adding that the mining sector was remitting only US$150 million despite generating US$2,3 billion.
The ministers called for a complete overhaul of the mining sector’s regulatory regime to ensure the country benefitted from its mineral resources.
“These companies should pay up what they owe and stop short-changing the Government,” Mpofu said.
“We should tackle this issue collectively and ensure these companies pay their dues.’’
He said while government critics were quick to claim that revenues from some of the country’s diamond mining activities were not finding their way into government coffers, the state had actually realised more from the Marange mines compared to what was coming from the platinum sector.
“These big mining companies are depriving the State of due revenues,” he said.
“There is a problem across the mining sector, yet people just want to pinpoint Marange Diamonds. At least we are getting something substantive from Marange unlike from companies such as Zimplats and Unki which are continuously shortchanging us.”
Biti said the country’s platinum miners should made accountable.
“Fifty percent of our exports, which is about US$2,3 billion, is coming from mining,” he said.
“The problem, however, is that only US$150 million is contributed to the fiscus. There is talk of corruption at Chiadzwa, but at least Treasury received US$174 million from there. Where are the Zimplats and the Unkis of this world?”
Labels: IMPALA PLATINUM, OBERT MPOFU, PLATINUM, TAX EVASION, TENDAI BITI, ZIMPLATS
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Over 50 mines face axe
Thursday, 08 September 2011 02:00
Golden Sibanda Business Reporter
More than 50 foreign-owned mining firms risk losing their licences after failing to submit acceptable indigenisation and empowerment plans as directed by Government.
In a statement, Youth Development, Indigenisation and Empowerment Minister Saviour Kasukuwere said the 51 firms also risked prosecution.
Already, the minister has indicated that they have started the process of cancelling the operating licence for Zimplats after the company failed to comply with the law.
Up to 45 mining companies have either had their plans approved or have agreed on an implementation framework and will generate revised plans to achieve a 51 percent indigenous threshold.
"Companies that did not respond or have not complied with the indigenisation and economic empowerment legislation will be prosecuted or have their business operating licences cancelled," said the minister.
In terms of the Indigenisation and Empowerment Act enacted in 2008, foreign-owned firms are compelled to cede for value at least 51 percent equity to locals.
Leading the band of delinquent foreign-owned mining firms is the country's largest platinum miner Zimplats, which might be first to lose its licence.
The firm wanted Government to recognise its claim that it had localised 30 percent of its equity after releasing a block of mineral reserves it says were worth US$150 million. The State said it would rather pay for the reserves than award credits.
Although Zimplats maintains that discussions with Government were continuing, Minister Kasukuwere on Tuesday said discussions had reached a dead end.
The platinum producer is 87 percent owned by Impala Platinum of South Africa. Implats is also a 50-50 joint venture partner with Aquarium in Mimosa Mining.
The minister said other non-compliant firms - after receiving seven to 14 days ultimatums - responded with acceptable revised plans that awaited final approval.
These include Mimosa Mining Company - the second biggest platinum producer in Zimbabwe - Murowa Diamonds, Blanket Mine and New Dawn Mining.
Mimosa Mining Company managing director Mr Winston Chitando met Minister Kasukuwere on Tuesday and expressed confidence in a positive response.
British American Tobacco that was also served with an ultimatum has been found to be largely locally owned and will only need to localise 15 percent equity.
Multibay Investments, Quali Exploration and Kwekwe Consolidated Gold Mines have already received final approvals to implement their plans.
"But with Zimplats it has been arrogance all the way. We are going to start the process of writing to the Ministry of Mines (to cancel the licence). The proposal from Zimplats has been deemed to be non-compliant with the law and was therefore rejected," said Minister Kasukuwere.
DISCUSS INDIGENISATION AND BLACK EMPOWERMENT ON FACEBOOK
Proposals from Cargill, Nestle, Barclays Bank and Standard Chartered were also rejected after they were deemed to be non-compliant.
Old Mutual and Stanbic Bank (Zimbabwe) were directed to honour agreements they entered with Government in 2010 and 1992 respectively.
Old Mutual had pledged to cede 27 percent of its stake to employees, 17 percent to local pension funds and 7 percent to the National Indigenisation Fund.
Stanbic had pledged to give workers 30 percent of its equity when it bought the then Grindlays Bank back in 1992, but has not honoured the pledge.
Minister Kasukuwere was yesterday due to meet Finance Minister Tendai Biti to map the way forward regarding the indigenisation of banks.
Government will soon finalise modalities for the manufacturing, transport, agriculture and agro-processing, education, sport and entertainment sectors.
Recommendations for engineering, construction, telecommunications, ICT, finance, arts and culture, energy, trading and health sectors are under discussion.
Labels: IMPALA PLATINUM, INDIGENIZATION AND EMPOWERMENT ACT (ZIMBABWE), SAVIOUR KASUKUWERE, ZIMPLATS
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COMMENT - Implats doesn't want to share profits or pay taxes. So what's new? Why would any country in the world want 'investment' that it doesn't benefit from?
Empowerment stymies US$10bln investment: Implats
26/08/2011 00:00:00
by
IMPALA Platinum Holdings Ltd., the world's second-largest producer of the metal, may invest as much as $10 billion in Zimbabwe to expand production if the government backs down on a demand that its business there be controlled by black citizens of the country.
The country, which has the world's largest platinum reserves after South Africa, passed a law earlier this year to force foreign companies to cede at least 51 percent of their local assets to black Zimbabweans.
Anglo American Platinum, the world's largest platinum producer, and Aquarius Platinum Ltd., also mine the metal in the southern African country.
"It would run into the billions of dollars, probably between $5 and $10 billion," Chief Executive Officer David Brown said in an interview in Johannesburg yesterday, where the company is based. "Fifty-one percent equity just does not work."
Impala first invested in Zimbabwe in 2001 when it bought 30 percent of Zimbabwe Platinum Mines Ltd. for the equivalent of $47 million and later took control of the company.
It is now the biggest investor in Zimbabwean mining, with the country in the third year of recovery from a decade-long recession sparked by the seizure of white-owned commercial farms for redistribution to black subsistence farmers.
The unit, now known as Zimplats Holdings, produced 182,100 ounces of platinum in the year to June 30 and is in the midst of a $460 million expansion of its Ngezi mine, southwest of the capital Harare to boost output to 270,000 ounces in 2014, according to a company statement.
"We could begin to look at phase three and beyond but this requires stability," Brown told investors at a presentation. The company has until Aug. 31 to revise its May proposal to satisfy ownership rules after it was rejected last week.
Impala also owns the Mimosa mine in the country in a venture with Aquarius.
Impala, which produces about 25 percent of the world's platinum, used to cut car emissions and make jewellery, is spending $4.5 billion over the next five years to expand production as rising demand drives up prices.
While most of its deposits are in South Africa, 11.3 million ounces, or almost a third of its total platinum reserves, are in Zimbabwe. That's worth about $21 billion at the current platinum price.
"It's a huge disappointment that we find ourselves in this position - we've been a model investor in this country," Brown said in the interview. Impala believes "an appropriate level of ownership will be the final result" of talks with the government, Brown told investors. The ownership rule could "retard" investment in mining and other industries at a time when it's needed, he said.
Economic expansion has been "largely confined to the mining and agriculture sectors," the London-based Economist Intelligence Unit said in a report earlier this month.
Power shortages, uncertainty over the likely election timetable "and continued confusion about legislation requiring 51 percent local ownership of all enterprises, are likely to prevent more rapid gross domestic product expansion," it said.
Zimplats signed an agreement with the government in 2006 to release of a portion of its mining claims in exchange for a combination of black empowerment credits and cash. Impala said in a June statement that year the area contains 99 million ounces of platinum, palladium, rhodium and gold.
The area could support open-pit mining and "could be turned into quite a profitable concern," Brown told investors. "They gave that ground to people who weren't necessarily interested in mining it."
The country also has the world's second-biggest chrome reserves as well as deposits of coal, gold and iron ore.
Labels: IMPALA PLATINUM, INDIGENIZATION AND EMPOWERMENT ACT (ZIMBABWE), ZIMPLATS
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