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Zimbabwe Releases Mine Proposal

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Zimbabwe Releases Mine Proposal

by Houston Chronicle

The government released proposals for new mining laws that will strip foreigners of control of mines and give control of key mines to the state, official radio reported Tuesday.

A 60-page draft of the minerals and mines amendment bill unveiled by Mines Minister Amos Midzi was the first concrete step toward seizing mines.

State radio said final adjustments to the draft were being made and it would soon be presented to the ruling party-controlled Parliament for approval.

Copies of the bill were not immediately available but a summary said it provided for the "indigenization and localization" of the nation's mining industry.

The state was entitled to control of key mines by "virtue of its original ownership of all useful minerals in its subsoil," the summary said.

President Robert Mugabe has repeatedly threatened to seize control of mining. Earlier this year, Parliament passed laws forcing other white and foreign-owned businesses to relinquish a 51 percent stake to black Zimbabweans.

Since 2000, more than 5,000 white-owned commercial farms have been seized in a chaotic land redistribution program that plunged the agriculture-based economy in the former regional breadbasket into free fall.

The new mining bill proposes a seven-year period for mining rights to be carved up but says foreign-held mining rights can be canceled in cases of obstruction and "willful noncompliance" with the objectives of the legislation to hand over control once it is in force.

It proposes the government take over 51 percent of concerns mining strategic minerals such as coal and coalbed methane, taking 25 percent without paying and paying for the rest.

The government also claimed a fourth of gold, diamond, platinum and other precious mineral mines, and said another 26 percent of those concerns should go to black Zimbabweans.

The government claimed no stake in other mines, but proposed that foreign and white interests relinquish 51 percent to black Zimbabweans.

Zimbabwe is suffering its worst economic crisis since independence in 1980, with chronic shortages of food, gasoline and hard currency for spare parts and equipment.

Official inflation of nearly 8,000 percent is the highest in the world. Some reports have placed it closer to 15,000 percent.

In May, the independent Chamber of Mines reported gold production plunged to its lowest in 90 years and hyperinflation, shortages of gasoline and equipment, regular power outages and an exodus of skilled mining personnel to better paid jobs in other countries also hit production of nickel, platinum and copper despite soaring world commodity prices.

Foreign investment has largely dried up in seven years of political and economic turmoil since the farm seizures, with potential investors citing concerns over ownership rights, economic disruptions under the sweeping nationalization program and officials criticizing Western-style market-led business practice.

 

 
 
 
 
 
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