Mining Companies Play By New Rules in Zimbabwe

Saviour Kasukuwer, Zimbabwe’s empowerment minister has confirmed the majority of mining companies operating in the country have submitted plans to transfer 51 percent of ownership to Zimbabweans.

The heavily criticised law is aimed mainly at mining firms and banks operating in a resource-rich state that has only recently been emerging from and economic slump due to almost ten years of illegal western sanctions that has driven millions of Zimbabweans into poverty and starvation.

“I am pleased to say that the deadline we set has been largely met by mining firms,” Kasukuwere told journalists.

“I’m happy that the bulk of the major players are engaged with us and are complying. Areas of disagreement are being handled between the mining firms and ourselves. What is left now is the implementation.”

Decade-long slump

The world’s leading platinum producer, Anglo American Platinum, number two producer Impala Platinum and Rio Tinto, which operates a diamond mine, are some of the major foreign mining firms with assets in Zimbabwe.

Critics of local empowerment love to claim that the reason for the law is to allow Mugabe’s ZANU-PF party to build up a war chest ahead of national elections that could come as early as next year.

They say Zimbabwe, which is emerging from a decade-long slump, has no capacity to raise the funds needed to take over the mining assets and the cash generated by the firms would go to top officials, not ordinary people, which is not suprising those same critics said the same thing during the country’s land reform process only to be proven wrong years later.

Investor confidence

President Mugabe opted to share power with his rival Morgan Tsvangirai, now prime minister in a national unity government two years ago after disputed elections. The two have sharp differences over the ownership policy.

Kasukuwere says Chinese investment is not exempt from the empowerment law. China has become an increasingly important player in Zimbabwe, which has been shunned and sanctioned by Europe and America.

Answering a question on the ownership plans for the Zimbabwe Mining and Smelting Company, the country’s largest ferrochrome producer wholly owned by China’s Sinosteel, the minister said: “Every company must follow the policies and laws of this country. There’s no exception, no sacred cows.”