Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Zimbabwe wants gold, diamond and platinum miners to pay half of their royalties to the government in the commodities themselves and the rest in cash, as the southern African country seeks to build its mineral reserves.
The Treasury was concerned that the country does not have reserves of the minerals, which “serve as a source of trust in a country given that they carry no credit or counter party risks,” Secretary for Finance George Guvamatanga said in a letter sent to the Ministry of Mines on Sept. 2 and seen by Bloomberg.
Guvamatanga confirmed the Treasury’s plans in an interview on Friday. “It’s something we want to implement,” he said by phone.
Polite Kambambura, deputy mines minister, said in a phone interview that consultations are still being undertaken with miners, including multiple meetings this week. “The whole idea by the Ministry of Finance is that they want to store value of our royalty,” he said.
Mining companies that operate in the southern African country include subsidiaries of Impala Platinum Ltd., Anglo American Platinum Ltd. and Sibanye Gold Ltd. Zimbabwe has the world’s third-largest reserves of platinum, and also mines nickel, chrome, lithium and coal.
(By Godfrey Marawanyika)
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