The Sunday Mail
WHEN Government announced 2016 export earnings from the mining sector had reached the US$2 billion mark, the news was naturally received with great enthusiasm.
Going into 2017, the challenge would have been to maintain the US$2 billion mark. But Government had other ideas, a new target of US$3 billion.
No sooner was it announced than it was dismissed by sceptics as an ambitious or at best a non-achievable target.
But with just over three months to go before year-end, the US$3 billion dollar mark is realistically within reach as the buoyant mining continues to grow.
Statistics released by Fidelity Printers last week showed that the country’s single largest mineral export, gold, soared almost 14,7 tonnes in the first eight months of the year — 10 percent higher compared to the same period last year and the jump is due to strong performance from the small-scale miners who have delivered 7,2 tonnes since January.
But most importantly, the increase in production has also been backed by firming international commodity prices and the Reserve Bank of Zimbabwe (RBZ) Governor Dr John Mangudya, announced earnings for the first half of the year rose by 20 percent to US$560 million compared to same period last year.
In the diamond sector, State miner the Zimbabwe Consolidated Diamond Company (ZCDC) has already surpassed its 2016 diamond haul of 961 537 carats, which earned the country a meagre US$42,1 million after the export of 897 710 carats.
In an interview, ZCDC chief executive officer Dr Morris Mpofu told this publication that the company was seating on 1 419 million carats as at September 11. Their target for the year is over 2 million carats.
But unlike last year where the gem- stones went for an average of US$54,74 per carat, the company has enhanced the stones’ cleaning process and the minimum target is US$100 per carat, which could earn the country over US$200 million up from US$42,1 million.
Elsewhere, the Chamber of Mines has noted an over 1 000 percent in the chrome sector with the first five months of the year accounting for 173 000 tonnes of ore up from 15 000 tonnes in the same period last year.
The next stage
Officially opening the Fifth Session of the Eighth Parliament on September 12,
President Mugabe underscored the need to capitalise on the current boom and move to beneficiation.
“The sustained growth in mining sector’s contribution to the country’s Gross Domestic Product hinges on the full implementation of the beneficiation and the value addition programme,” said the President.
“I, therefore, appeal for the expeditious finalisation of Parliament scrutiny of the Mines and Minerals Amendment Bill,” he said.
Zimbabwe remains largely a raw material exporter, and this denies the country an opportunity to maximise on value from the minerals in their raw and or semi-processed form.
The cyclic nature of the global commodities usually follows a boom and bust cycle, and the world is currently witnessing a boom cycle, which is normally a boon for resource-rich countries in Sub-Saharan Africa, Zimbabwe included.
Economists, however, warn that resource-reliant economies need to be diversified in order to absorb the volatility associated with global markets.
The solution
Government has been working on the ease of doing business to promote investment.
Mines and Mining Development Mr Minister Walter Chidhakwa has noted the high cost of power as a major hindrance to the setting up of beneficiation plants locally and there is need to put action to his words.
Addressing delegates at the Minex in August the minister said reducing power cost to US3c per kilowatt hour from the current US12c per kWh will do wonders in the sector.
“We everyday talk about value addition and beneficiation, and there is a part of value addition and beneficiation which is strongly and largely dependent on power, that is chrome,” said Minister Chidhakwa.
“That does not mean all the other minerals don’t come into place but I mention chrome specifically and I always say at the moment the companies have negotiated US6,1c (or) US6,2c per kWh with Zesa and they are operating because the prices are somewhere.
“But let me say this, if we have 3 cents power in this country, a lot of the smelters in the region will move to Zimbabwe, because power constitutes between 35 and 40 percent of the cost of moving from chrome ore to ferrochrome.
“Now 30 percent of your expenditure coming from one item and that item all of a sudden has very competitive cost, it will be amazing for this country.
“So the talk about value addition and beneficiation in terms of moving from chrome ore to ferrochrome can actually be moved simply by getting the right price of power, the right reliability of power and that would drive value addition and beneficiation,” he said.
