HomeLocal News‘Value-addition lacking in mining’

‘Value-addition lacking in mining’

THE mining sector has contributed more than half of the country’s total exports and foreign direct investment (FDI) inflows since 2009, but it is not realising its full potential owing to inadequate value-addition, Mines minister Walter Chidhakwa has said.

Hazel Ndebele

Mines minister Walter Chidhakwa

Officiating at the Mining and Agriculture Interface breakfast meeting at the Harare Agricultural Show yesterday, Chidhakwa said mining is a viable driver of economic development.

“The mining sector continues to play a significant role in economic development of the country contributing more than 50% of the nation’s total exports since 2009, more than 50% of FDI, 45 000 formal jobs and more than 200 000 artisanal miners and between 7-10 % of fiscal revenue,” said Chidhakwa.

However, he said mining’s contribution to fiscal revenue needs to improve to at least 15%. Mining operations have been weak in creating the necessary linkages with the rest of the economy as minerals are extracted and exported largely in raw form.

“In order to maximise the developmental impact of mining and ensure the country gets maximum benefit from its mineral resources, the ministry aims to foster economic interdependencies between mining and the rest of the economy, including agriculture, especially through maximising on value addition,” Chidhakwa said.

“Local value addition also facilitates infrastructural development and employment creation in Zimbabwe.”

He said the plans to establish a platinum refinery are on course although at a slow pace. Chidhakwa revealed that the Mines ministry is currently planning to increase the levels of beneficiation of granite from the current levels of 5% of production with the aim of reaching 30% in the near future.

Chidhakwa said the interface between mining and agriculture is important as the two sectors sustain livelihoods.

“The country produces various minerals which are of importance in the agriculture sector such as phosphates (used to manufacture fertilisers), lime and vermiculite. On the other hand, the mining sector requires agricultural products to feed its workforce,” he said.

“Mining and agriculture share the need for infrastructure and both entail the risk of environmental damage and have impacts on local communities. Furthermore, agriculture and mining can compete for key inputs such as land, water, labour.”

Chidhakwa said government needs to formulate policies in both sectors which are designed in such a way that they generate positive outcomes and complement each other. He said his Ministry spent time trying to resolve disputes between farmers and miners on land issues, highlighting the necessity of the two sectors to engage.

Zimbabwe Agricultural Society chief executive Anxious Masuka said the mining and agriculture interface would improve livelihoods and economic growth. He said the two sectors should complement each other to avoid disputes.

Masuka said the farmer is interested in the first 45 centimetres of the soil, whereas the miners are interested in digging deeper, which shows the need for building linkages.

Chidhakwa said the Ministry of Mines has promulgated the Mines and Minerals Amendment Bill which seeks to address the farmer-miner relationship in a bid to see the two sectors being able to co-exist amicably. The Bill will also seek to introduce strategic minerals whose exploration and extraction will follow special rules.

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