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.
At least one of the diamond miners that saw their licences revoked and were asked to leave Zimbabwe earlier this week because their licences had expired, is planning to sue the African nation’s government for breach of contract.
Speaking to Reuters, Zimbabwe’s Diamond Mining Company’s (DMC) manager Ramzi Malik said the firm’s contract with the State clearly stipulated that renewing licences was the responsibility of the government, through its state mining arm Zimbabwe Mining Development Corporation (ZMDC).
DMC is not alone. Industry sources told The Zimbabwean that more affected companies are looking for a way out of the situation, which includes legal actions or even international arbitration to challenge the government’s decision.
“There is not going back” — Mines Minister Walter Chidhakwa.
The government has not replied to the mining companies complains yet, but state-controlled Herald newspaper quoted Mines Minister Walter Chidhakwa Friday saying there were “not going back” on the government’s decision, which he qualified as “not negotiable.”
President Robert Mugabe’s government has been accused of a lack of clarity on the particular issue and the country’s diamond industry in general. A decision to merge miners into the Zimbabwe Consolidated Diamond Company has also been controversial, and there is speculation that Rio Tinto’s (LON:RIO) withdrawal from the country last year, was in part due to the increasingly hostile business climate.
Authorities have increased security at the mines in the Marange District after news of looters invading the country’s diamond fields right after operations ceased.
9 Comments
patentbs
Expropriations. shut downs, looters. .unemployment. armed guards. All that is left is a slaughter of innocents and the nation’s regression will be complete. Looks like Rio Tnto made a wise move.
Backseat Driver
More Mugabe madness. How can this tyrant still be in power?
Kenneth Viney
Weak Rio Tinto management went in there to change the status quo and got burnt. Why isn’t this corrupt dictator dead? This commie has destroyed millions of young black lives. When will it end? The country was a hell of a lot better off under European rule and so were the other 49 Africian countries as well. Just ask the blacks in Bermuda. They vote for a British AG every 6 years.
Zimbo
Is that really how it goes though….? Are people better off as slaves though ? Really mate ? The current leaders will eventually die, noone lives forever, and the legacy they leave behind will be great if you look at the bigger picture …… i.e the resources are in the hands of the locals, which other former colony can honestly say that ? Things are definitely in dire straits at the moment but time will eventually pass and policies will eventually shift. Only difference is when things do get better the land and remaining resources will be owned by locals and through that ownership a new legacy will be built for zimbabweans. Its really very backward to assume things were better off when europeans ruled, considering that all the chaos in african nations who are apparently “independant” is via clandestine machinations of the west (and at times the east) through the funding of regimes that directly destabilise nations and create environments where they, “powers that be”, can continue to loot that nations resources…..look at the national geographic doc on france and some oil rich nation and some french super powerful petroleum giant ……. shall i say more ?
Surendra Kapoor
People of Zimbabwe must react with full force to remove the tyrant president at any cost.Or live a life of street dogs.
Ftballplaya99
Yes it was a hell of a lot better off under European rule, FOR EUROPEANS, BUT NOT FOR AFRICANS….
Europeans are upset that in Zimbabwe the President isn’t a puppet of the west…
This man took back stolen land and now stopped the mineral wealth to be taken for Pennies… This is good, no GREAT and I pray he sets an example for other African and Asian countries…
http://www.raceandhistory.com/Zimbabwe/2010/1611.html
Restless Boomers
Contracts work in countries like Rodeshia where the Rule of Law is respected. Guns, knives and machetes are for nations like Zimbabwe and the United States where Executive Order governs.
Gary
How do you take a government to court that does not respect the rule of law and makes it up as they go along?
Kenneth I agree with you 100%, recent history shows that chaos follows when a dictator is removed from power. i.e. Libya, Iraq, Iran and the old Zaire (Mobuto Sese Seko)
I seriously doubt that things will get better in Zimbabwe once Mugabe eventually dies
Bento
the capitalists are revolting! fantastic title for this article. How dare these people deny the capitalists right to exploit their resources! What is this a government that denies the right of the capitalists to exploit! How can this be tolerated in this day and age of global imperialism…
Also reassuring to read the comments of the western brainwashed sycophants.
I could say in chorus with them – get these nigers working! we have lost enough money already!