Diamond policy ready by June

06 May, 2018 - 00:05 0 Views
Diamond policy ready by June

The Sunday Mail

GOVERNMENT expects the diamond policy, which is being crafted to address a number of issues, to be ready by mid next month.

Straight after the conclusion of the diamond policy, Government will shift its focus to crafting a policy to guide the platinum sector.

This comes as Government seeks to find a lasting solution to the two key sectors — diamonds and platinum – which were omitted when the mining sector was liberalised after significant changes to the Indigenisation and Economic Empowerment Act.

The Indigenisation Act, which was operationalised in March 2010, demanded that locals hold 51 percent in all foreign-owned companies.

While the Indigenisation Act in its previous form was feted as a noble legislation aimed at preventing the plunder of finite resources such as gold, diamonds and platinum, foreign investors failed to appreciate its intentions and held back fresh investments.

Overall, investors also boycotted the country, resulting in a major decline in foreign direct investment (FDI), averaging US$450 million per year, compared to regional averages of US$3 billion.

The new Government led by President Emmerson Mnangagwa then resolved to amend the Indigenisation Act to allow foreign investors to own 100 percent of their ventures in all other mineral sectors except the diamond and platinum sectors, where the 51/49 percent shareholding structure remains.

The new diamond policy is now expected to guide a number of issues such as exploration and ownership in the sector.

Last week, Mines and Mining Development Minister Winston Chitando told The Sunday Mail Business that the diamond policy is being finalised and will be published next month.

“It’s not yet ready. lt will be published by mid-June. The policy covers everything from exploration, ownership, mining, processing, selling and shareholding, everything,” said Minister Chitando.

It is expected that once the diamond policy has been published, work to create a platinum policy will immediately begin.

The platinum policy is also anticipated to speak to issues pertaining to exploration, shareholding, selling and mining, so that there is a clear structure on who does what, and at what stage.

Said Minister Chitando: “After that (diamond policy), we will start working on the platinum policy.”

Efforts to craft the diamond and platinum policies come at a time when Government is considering moving away from exporting raw mineral resources.

Eventually, all products, even those from the agricultural sector, to be beneficiated before exportation.

This was recently reaffirmed by Vice President General Constantino Chiwenga (Retired), while fielding questions during the International Business Conference which ran concurrently with the 59th edition of Zimbabwe International Trade Fair.

VP Chiwenga said value addition and beneficiation have been on the country’s agenda for a long time and should be fulfilled.

“This (value addition and beneficiation) is something we have been discussing over and over again. Everything we produce in this country should not be sold in its raw form.

“There has to be some beneficiation. In fact, everything we produce, be it in mining, be it in agriculture, be it in our manufacturing; this is what we want to achieve.

“You might have noted that when we opened up our minerals sector, we left two minerals because that (diamond) policy has not yet been finalised.

“It is actually being worked on by the Minister of Mines and Mining Development, Honourable Chitando,” said VP Chiwenga.

VP Chiwenga added that President Emmerson Mnangagwa is very clear that the policy on diamonds and platinum should be put in place in the near future, and that Government is satisfied with progress.

Key stakeholders have been consulted during the crafting of the diamond policy to eliminate discord once the policy has been published.

During his recent State visit to China, President Mnangagwa alluded to the need for the diamond and platinum policies.

“Very soon we should be able to come up with a new policy to govern these two (diamonds and platinum),” said the President while speaking to investors in the Anhui Province, China.

Since the relaxation of the Indigenisation and Economic Empowerment Act, there has been a flurry of investment enquiries.

Firm investment commitments have topped US$11 billion in the last five months as foreign investors’ confidence is sky high on the back of policy consistency, clarity and the tweaking of the contentious Indigenisation Act.

One of the biggest mining sector investments since independence has been Karo Resources’ US$4,2 billion platinum deal, which is expected to directly employ 15 000 people.

There has been several other multi-million dollar investment deals in lithium and coal, among other sectors.

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