The mining sector which is a critical foreign currency earner has registered a more than 60 percent growth in production and earning with expectations the relaxation of the indigenisation laws will further increase foreign direct investment inflows.
Coupled with tax incentives for the resources based industry is being expected to renew investors’ interests’ thereby unlocking potential for growth with mining experts expecting improved viability for the industry.
The 2017 state of the mining sector review announced in the capital on Friday (today) that the extractive sector has continued to show recovery on the back of a rise in overall profits and production targets for locally based mining firms.
Tied with the proposed amendments in the 2018 national budget that will see the 51/49 indigenisation thresholds being applied to only diamonds and platinum with the rest being removed, Chamber of Mines president Mr Batirai Manhando said this will set the tone for increased investments in the capital intensive but viable resources sector.
With data showing the mining sector is contributing 13 percent of the gross domestic product (gdp) and about 68 percent of the total exports, the indigenisation amendments as well as the announcement by fiscal authorities of the postponement of a 15 percent tax on unrefined platinum exports will generate more foreign currency, said the Reserve Bank of Zimbabwe deputy governor Dr Kupukile Mlambo.
Treasury also announced ease of doing business policies on the mining sector and a downward review of mining fees and charges instilling confidence in the mining sector, notes the new Minister of Mines and Mining Development Cde Winston Chitando.
Findings from the 2017 state of the mining sector report show the industry is next year expected to grow by 7.5 percent due to a modest recovery in global prices for most minerals, with export receipts of US$2.5 billion being projected for 2018 from US$2.3 billion this year.