High Fees Drive out Small-scale Miners

ONLY about a quarter of the estimated 1,5 million small-scale miners who were affected by the government’s 2006 clean-up operation codenamed Chikorokoza Chapera have resumed operations due to high registration fees and Environmental Impact Assessment consultant costs, the Zimbabwe Miners’ Federation (ZMF) said this week.


ZMF chief executive Wellington Takavarasha told businessdigest on Wednesdays that the sector had failed to recover three years after the blitz on its members.

“Operation Chikorokoza Chapera closed down virtually all operations of small-scale miners,” Takavarasha said.
The blitz on small-scale miners was launched in November 2006 ostensibly to bring gold panning activities under control, but resulted in the shutdown of most small-scale mining activities.

“To resume operations, a miner was required to have an Environmental Impact Assessment carried out by a consultant which costs between US$300 and US$600 plus US$100 to be paid as registration fee. The fees were beyond the reach of many small–scale miners,” he said.

Takavarasha said before the crackdown, small-scale miners contributed between 50 to 60% of the country’s total gold output.

“The drastic reduction of small-scale miners has had an adverse effect on their contribution to gold production as evidenced by last year’s output where only 3, 4 tonnes were produced,” said Takavarasha.

Takavarasha said the fees are threatening to further reduce the number of small-scale miners as well as increase the number of illegal gold panning activities depriving the country of much needed foreign currency.

He said that the ZMF had held several meetings with various stakeholders within government in an effort to reduce the costs of resuming operations.

“The resumption of operations is supposed to promote empowerment and indigenisation, but with these requirements we are disempowered,” he said.

On the issue of arrears owed by the Reserve Bank, government introduced “Special Tradable Gold-backed Foreign Exchange Bonds” with a 12-month tenor and an 8% interest per annum on maturity.

The holder of the bonds can sell them to any interested counterparty locally, regionally or internationally at an agreed time-to-maturity.

Businessdigest however understands that the chamber of mines yesterday submitted proposals to the Reserve Bank seeking half the payment of the arrears, with the balance being deducted as tax and duties.

Meanwhile mineworkers are in limbo as they are yet to be paid their January salaries due to protracted wage negotiations between the Associated Mine Workers’ Union of Zimbabwe and the Chamber of Mines.

Union president, Tinago Ruzive said that they were demanding a minimum wage of US$500, but the Chamber of Mines had made an initial offer of US$40.

Ruzive argued that the figure they were asking for was reasonable because the US dollar was losing value in Zimbabwe due to distortions in the market, adding that the offer by the Chamber is ‘unacceptably low’.

He said the delay in wage negotiations had frayed tempers of mine workers with over 500 workers at Vuba Chikwe mine in Gwanda downing tools.

“Workers are up in arms because we have not made a breakthrough in our negotiations. Most miners are on a go-slow. I have had numerous inquiries from our members who are gearing up for a strike but I have told them that were still negotiating. I don’t know how long I can keep the lid closed on a boiling pot,” he said.

Ruzive said the permission by the Reserve Bank to have workers paid in foreign currency had given them a fresh impetus in making their demands.

BY KUDZAI KAWAZA