Monday, October 28, 2013

Zimbabwe Minerals Earn $1.4 Billion

Minerals earn US$1,4bn

October 28, 2013
Business Reporter
Zimbabwe Herald

ZIMBABWE earned US$1,38 billion from mineral exports in the nine months to September 2013 largely driven by sales of gold and platinum, official figures from the Chamber of Mines of Zimbabwe show.

However, the figures do not include exports of diamonds, which earned the country US$684 million last year. It means the country earned more from minerals than industry figures have indicated.

Gold contributed the biggest chunk of the export inflows after US$483 million worth of the bullion was sold while platinum exports totalled US$424 million during the period under review.

According to the Chamber of Mines monthly production report, a total of 10,4 tonnes of gold were produced during the period while 9,8 tonnes of platinum were also mined and exported.

Other notable exports were recorded in nickel, which brought in US$111,9 million, high carbon ferrochrome US$72,5 million, coal US$47,2 million, copper US$33,2 million, palladium US$153 million, rhodium US$25,2 million, iridium US$7 million and graphite US$3 million.

A total of US$939 million from the export of minerals in the six months to June 2013 with gold and platinum contributing the most earnings at US$329 million and US$292 million respectively.

Considering that Zimbabwe is generally under- explored and holds the second biggest known deposits of platinum, the country has potential to earn significantly more from mineral exports.

Zimbabwe is host to more than 40 mineral occurrences with all the country’s provinces endowed with at least one mineral, the reason why it has the highest per capita resource ratio.

The mining sector, which accounts for 50 percent of exports, has been officially declared by Government as the centrepiece of Zimbabwe’s economic growth in the short to medium term. It has also grown to become the biggest contributor to Gross Domestic Product, marginally overtaking agriculture at 16,7 percent in 2012 and is seen maintaining this position beyond 2018.

While the sector is expected to underpin the country’s economic growth at least in the short to medium term, a plethora of challenges are militating against unhindered growth of the sector.

The challenges include shortage and inconsistent power supply, high cost of labour and other utilities, shortage and inadequate water supplies, a number of mining charges, fees and royalties.

Mining companies in Zimbabwe also face serious challenges in terms of access to affordable lines of credit considering that mining is a generally capital intensive business.

Zimbabwe is reeling from choking liquidity constraints after enduring a decade of economic recession due to the negative impact of illegal sanctions imposed on the country by Western countries after the country repossessed land from white farmers for equitable distribution among locals.

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