23 Jul 2019
Finance minister Mthuli Ncube has revealed that the Zimbabwean government is considering a duty waiver for closed mines, saying that enabling mines to import equipment duty-free would help boost the mining sector, allAfrica reports.
Speaking through his director for economic planning and modelling Charles Mujajati at the Mine Entra conference, Ncube said: "The country stands to benefit a lot in terms of employment, incomes and fiscal revenue, among others, by resuscitating a number of closed and distressed mines located in various parts of the country.
Government is committed to offer full support for the resuscitation of such mining companies, including awarding them national project status where necessary, as well as fiscal incentives, which will allow duty-free importation of equipment, thereby facilitating the resumption of operations.”
Ncube explained that these mines had fallen victim to Zimbabwe’s decade-long economic crisis and the global financial crisis, consequently resulting in metal prices dropping significantly.
Some of the closing mines are Alaska, Mhangura, Silverside, Shackleton, Golden Kopje, Falcon Gold, Giant and Elvington Gold mines.
Ncube went on to note that Zimbabwe could benefit significantly from the mining sector and go on to incur great revenue.
He said: "Deriving such benefits, however, largely depends on investment and other support for the sector. Such potential is in respect of minerals such as platinum, gold, lithium and other metals.”
Additionally, Ncube pointed out that delays in the amendment of the Mines and Minerals Act were stalling further exploration and investment in the sector. The mining sector contributed an average of 6,2% to the gross domestic product (GDP) between 2009 and 2015 and 8,4% from 2016 to 2018.
In 2017, mining contribution expanded by 9,2% and 10,1% in 2018.
"Prospects to maintain the average contribution to GDP have, however, been hampered by depressed international prices for other minerals and to some extent power, fuel and foreign currency shortages," Ncube said.
It was also revealed that the mining sector is the biggest contributor to export earnings.