Zimbabwe proposes half of royalties paid in gems, precious metals
Zimbabwe is proposing miners of gold, diamond and platinum to pay half of their royalties to the government in the commodities themselves and the rest in cash, as the southern African country seeks to build its mineral reserves.
The Secretary for Finance George Guvamatanga, in a letter sent to the Ministry of Mines, said the Treasury was concerned that the country does not have reserves of the minerals, which “serve as a source of trust in a country given that they carry no credit or counter party risks. Polite Kambambura, deputy mines minister said that consultations are still being undertaken with miners, including multiple meetings this week.
Mining sector
“The whole idea by the Ministry of Finance is that they want to store value of our royalty. It’s something we want to implement,” he said.
Zimbabwe’s mining sector is highly diversified, with close to 40 different minerals. The country boasts the world’s third-largest reserves of platinum, and also mines nickel, chrome, lithium and coal. Mining companies that operate in the southern African country include subsidiaries of Impala Platinum Ltd., Anglo American Platinum Ltd. and Sibanye Gold Ltd.
The sector accounts for about 12 percent of the country’s gross domestic product (GDP), and the minister of mines claims the sector has the potential to generate US$12 billion annually by 2023 if the government addresses challenges such as persistent power shortages, foreign currency shortages, and policy uncertainties.
