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Transparency key for mining sector

MINES and Minerals Development Minister Walter Chidhakwa’s reading of the riot act to players in the diamonds industry, if followed through to its logical conclusion, would signal a departure from the sleaze enshrouding the sector and usher in a real possibility of realising the full potential of the mining industry.

Zimbabwe Independent Editorial

It is always difficult to state when meeting with people from other countries that Zimbabwe is a poor country, because it is certainly not.

You cannot be poor when you command a significant share of the world’s most sought after resources, gold, platinum, diamonds to name just a few precious ones.

We also have plenty industrial ones, chrome in particular, coal, with both diamonds and platinum also falling into this category. Then we have the lessor famed ones such as tantalite, which owe the rise in their use to modern technology such as cellularphones.

We’re even told we have strategic minerals such as uranium, whose prices are surging as demand for industrial nuclear energy rises. Surely, among countries that should be referred to when discussing Adam Smith’s famed Wealth of Nations, Zimbabwe should be very much among the top contenders.

But instead, when we use indicators such as Gross National Product per capita income we certainly rank among the poorest countries, just managing to edge poverty itself.

Of course, those who pursue the agendas of secret societies will argue that minerals are worthless underground and only derive value once extracted. If that were not the case, why is there much business in selling and buying mining claims?

Countries such as the United States jealously manage these claims, including areas not yet pegged by any company. But the US manages these issues transparently and hence why its mining industry is vibrant.

Countries such as the DRC, Uganda, Kenya and Tanzania have realised this and are following suit by adopting information and communication technology that allows governments and potential investors at the click of a mouse to access all data on mining claims, their location beyond a six-grid reference point, their prices, right down to how much taxes have been paid on the mining activities. Any industry cannot realise its full potential where there is information asymmetry.

In our case there isn’t just information asymmetry; there is opacity. Of all the “best practices” claptrap that Zimbabweans love to echo, this is one they should really adopt.

And we mean both the public and private sector need to adopt the efficient and transparent granting and managing of mining claims in this country.

Any investor should be able to access from the Mining Commissioner’s office information on who holds what claim, and for how long. This should facilitate investment in the sector. The old practice by multinationals of holding onto claims for eons while not developing them should be halted.

The Chamber of Mines would need to transform itself from being an old boys’ club that secretly holds information on mining activities and covers up its members’ worst practices to one that promotes rapid development of the sector. Transparency is key to making Zimbabwe’s mining industry realise its full potential.

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