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'Mugabe planned to seize mines'
07/04/2008 17:38 - (SA)
Johannesburg - While the world waits for news about the outcome of Zimbabwe's elections, Zimbabwean newspapers at the weekend reported that Robert Mugabe's Zanu-PF planned to seize foreign-owned mines to win over votes.
Across the front page of The Zimbabwean on Sunday were splashed
headlines suggesting that Mugabe had set his sights on foreign-owned mines after running "out of assets with which to buy votes and loyalty from its top officials as well as the police, war veterans and uniformed forces".
Citing documents tabled at Friday's politburo meeting, the newspaper said it was the government's strategy to grab the mines after accusing the owners of shutting down their operations to sabotage Zimbabwe's economy.
"The documents tabled at the Politburo meeting advocate a 'use-it-or-lose-it' policy. This will be backed by a populist policy to win votes by aggressively pursuing an indigenisationpolicy involving the grabbing of foreign-owned enterprises in the 'short term'," the newspaper reported.
The Chamber of Mines of Zimbabwe said it was aware of the plans to have mines in continual production to ensure licences were not revoked and the planned indigenisation of the sector, but said they were unaware of the "fast track" strategy.
"Analysts believe this step will result in mine invasions similar to the farm invasions of 2000 and the consequent collapse of the mining industry," the newspaper said.
Just last month Mugabe approved a new law to compel mines and other businesses operating in the country to be 51% owned by Zimbabweans.
The state-controlled Sunday Mail at the time reported that the
Zimbabwean government would approve any projects or company reorganisations unless the condition was met.
Zimbabwe has the world's second-biggest deposits of platinum and chrome after South Africa, which has the biggest reserves of both metals.
Operations scaled down
Mining companies with operations in Zimbabwe have been subject to the world's highest inflation - last week said to top 168 000% - political uncertainty, infrastructural collapse and the ongoing dearth of foreign currency.
Many foreign-owned mines have scaled down operations in the last few years and some have put their operations on care and maintenance as they wait for the outcome of the county's presidential race.
South African companies such as Impala Platinum (IMP), Metallon and Central African Gold, which bought two Zimbabwean gold mines
last year, are all considering expansion or ready to expand.
But the economic and legislative environment is crimping growth.
John Robertson, an independent economist in Harare, told the Zimbabwe Gazette in late March that national gold output was at the lowest level since 1907.
According to the Zimbabwe Chamber of Mines, the country produced 7.5 tons of gold last year, down from 29 tons in 1999.
Robertson said coal and iron ore production had more than halved since 2000, while nickel and ferrochrome output had fallen by about 15%.
This means that many operations are finding it difficult to survive despite high commodity prices - platinum and ferrochrome prices have more than doubled in four years while gold is lingering near multi-decade highs.
- I-Net Bridge
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