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Zimbabwe Capable of Unlocking $15 Billion in Mining Investment

  • Blessing  Zulu

Observers told VOA Studio 7 that Zimbabwe needs urgent local interventions to create investor confidence, boost local production and put a stop to high import bills.

Observers told VOA Studio 7 that Zimbabwe needs urgent local interventions to create investor confidence, boost local production and put a stop to high import bills.

A senior executive at the World Bank office in Zimbabwe Dr. Sidwell Hove says the country will unlock between US$5 billion and $15 billion in mining investment potential by 2018, if President Robert Mugabe's government addresses regulatory, operational uncertainty and infrastructural bottlenecks that are holding back growth in the sector.

Hove made the remarks at the ongoing mining indaba in Victoria Falls being attended by government officials and investors.

Zimbabwe - with the world’s second-largest platinum reserves and vast deposits of other minerals such as gold, coal, nickel and chrome - has cast its eyes on the mining sector for increased contribution to state revenues.

But this is constraining mining companies, which have complained of high taxes and uncompetitive royalties and other mining fees.

Economist Prosper Chitambara of the Labour and Economic Development Research Institute said Harare has a huge potential but there has not been an audit of the minerals.

Meanwhile, observers told VOA Studio 7 that Zimbabwe needs urgent local interventions to create investor confidence, boost local production and put a stop to high import bills.

They said clear economic policies can contain these issues, including low foreign direct investment and weak growth in key sectors.

The observers, who include company executives and economists, said Zimbabwe should join the Rand monetary zone in order to enhance trade with neighbouring nations.

They said deflation is likely to worsen if the government does not take urgent measures to adopt investor-friendly policies.

One of the observers, Bulawayo businessman Bulisani Ncube, believes the Zimbabwe economy will soon decline to the 2008 hyperinflationary levels if these measures are not adopted.

The government has created an economic blueprint – the Zimbabwe Agenda for Social and Economic Transformation – which it believes will revive the economy through the use of local resources and foreign direct investment.
The country has been failing to attract foreign investors due to its controversial black economic empowerment program and several other socio-economic and political issues.
Under the current indigenization law, foreign-owned firms are compelled to transfer majority shares to local people.
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