Godfrey Marawanyika/Eric Chiriga
THE Mining and Minerals Act is being amended to accommodate an empowerment clause which will require foreign investors to cede a significant shareholding to indigenous people
Last week President Robert Mugabe said government would demand a 50% shareholding in all mining investments.
A draft of the amendment has already been circulated to mining representatives.
The latest development comes in the wake of concerns by government that mining firms are not doing enough to empower Zimbabweans.
Currently the statute allows for only a 15% shareholding to be reserved for locals.
Chamber of Mines chief executive officer, David Murangari, said a copy of the draft amendments had been sent to them.
“One of the major changes in the amendments is to include a clause on empowerment. There is no specific clause on what sort of percentage but this has to go through parliament during the current session,” he said.
“Once the amendments have been done it will become public knowledge.”
Last week Mugabe said government was going to demand a 50% stake in all mines.
Murangari said since government had not officially communicated to them on increasing the 15% stake to 50%, he could not comment.
Most of Zimbabwe’s mining firms are owned either wholly or partially by multinational companies that include Anglo American Corporation, Ashanti Goldfields, Rio Tinto and Mwana Africa.
Some of the locally-owned mines are Makwiro Platinum, formerly Broken Hill Proprietary, and mines owned by the Zimbabwe Mining Development Corporation.
Zimbabwe’s Labour and Economic Research Institute director, Godfrey Kanyenze, said the contribution of the mining sector to both gross domestic product and employment had steadily declined since1980.
“In 1980 mining contributed 8,8% towards GDP, by 1990 the figure had declined to 4,4%. In 2002 the sector contributed 1,4% to GDP,” he said.
“The sector employed 6% of total formal sector employment, but by 1990 this had declined to 4,3% before hitting 0,8% by the year 2002.”
Kanyenze said the depreciation of the local currency in the 1990s resulted in soaring inputs costs, 40% of them imported, which resulted in a number of workers losing their jobs.
He said their research into the state of the mining sector had revealed that when Mhangura Copper Mine closed 1 300 people lost their jobs.
Kanyenze said retrenchments had also affected foreign-owned firms such as Anglo American.