PROSPECT Resources Limited (PRL) managing director Sam Hosack says Zimbabwe’s mining sector is on the rise following significant policy changes in the sector to enhance production over the last two years.
Hosack said the dissipating inflationary pressures and relative currency stability as well as policy stability will see a return in foreign investment in the extractive sector.
“Mining is a key sector to the government’s plans to achieve an upper to medium economy by 2030. The government of Zimbabwe has made key policy changes in registrations of greenfield projects.
“The use of Special Economic Status for miners is key as it allows offshore banking in foreign currency, exemptions on withholding tax for dividends, remittances and royalties and customs clearance at mine site.
“Zimbabwe has over 100 years of mining history and is the fifth largest producer of lithium in the world, second largest producer of platinum and largest producer of chrome,” he said.
PRL is an ASX listed lithium company based in Perth with operations in Zimbabwe. Its flagship project is Arcadia Lithium on the outskirts of Harare. Zimbabwe expects a surge in foreign currency earnings from the mining sector this year, and has set an ambitious target to grow the mining sector to a US$12 billion industry by 2023.
This year the Reserve Bank of Zimbabwe (RBZ) expects gold exports to increase on the back of higher commodity prices globally and favourable policies domestically. The central bank has recently introduced policies that include a five percent incentive and slashed small scale miners’ royalties to increase deliveries of the yellow metal.
In June, gold deliveries were 2,9 tonnes compared to 1,4 tonnes while July deliveries stood at 2,8 tonnes compared to 1,4 tonnes recorded in the prior period.
Gold output increased by six percent to 12,7 tonnes between January and July this year compared to 12 tonnes recorded in the prior period.
According to the central bank, the country received US$1,903 billion in mining exports during the period to June 30, 2021, up 37,8 percent from US$1,380 recorded in the prior period.
Gold contributed US$309,9 million, up 31 percent compared to the same period last year while platinum contributed US$1,181 billion, chrome ore and ferrochrome US$39,4 million, diamonds US$68,2 million and other minerals contributed a combined US$304,5 million.
The government is also finalising the Mines and Minerals Act, amendment of the Gold Trade Act and Precious Stones Trade Act, development of Minerals Development Policy and other mineral specific policies.
The Minerals Development Policy and Artisanal Small Scale Gold Mining Strategy are being developed while the Amendment of Mines and Minerals Act awaits tabling before the Cabinet committee on legislation.
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