Harare, Zimbabwe — MININGREVIEW.COM — 11 May 2009 – A leading Zimbabwean mining industry official has appealed to the country’s government to consider scrapping provisions compelling foreign mines to sell majority stakes to locals, and instead to allow miners to set their own empowerment targets.
Foreign investors are concerned by the government’s indigenisation laws, which have led to many companies withholding the investment needed to increase mining production after the slump of the past seven years, according to Reuters.
The southern African country has enacted a law which forces foreign companies – including mines and banks – to sell 51% ownership to local blacks, while allowing the government to seize 25% of shares in some mines without paying.
Chamber of Mines past president Jack Murehwa said companies should be allowed to draw up a timetable to meet their own targets to sell a stake to local Zimbabweans, and the government should then ensure that the mining companies meet the targets. “We don’t believe that setting up empowerment limits is the way to go, it serves no purpose at all,” he told a mining conference here.
“Let the mining companies set the targets … and leave foreign investors to talk to potential local partners of their choice in the country,” Murehwa added, referring to a clause that allows the government to recommend local partners.
“We need consistency in terms of government policies, and we need clarity on indigenisation and empowerment. The perception out there of Zimbabwe being an investment destination is still very low, Mhembere emphasised.
“Over the last 10 years we have not had exploration, so we have this 10-year gap, and if we start full mining production we are going to face a slump not far from now,” he warned.