Zimbabwe Eyes to Receive Mining Royalties in the Form of Refined Metal
October 10 2022 - 9:02AM
Dow Jones News
By Yusuf Khan
Miners operating in Zimbabwe will have to pay some of their
royalties to the country using refined metal, with the country
seeking to expand its national reserve of strategic minerals.
In his column in Zimbabwe's The Sunday Mail, President Emmerson
Mnangagwa said that the government was establishing a new policy of
accumulating precious and high value minerals to build up a
strategic stock of gold, diamonds, platinum group metals and
lithium.
As part of this, miners will now have to pay the government part
of their royalties as refined metal, having previously paid only a
fee to the government for being able to mine within the
country.
The president said that this would allow Zimbabwe to both build
physical reserves of precious and strategic minerals while also
ensuring revenue for the day-to-day running of government
business.
He added that the country's policy toward mining royalties
should respond to resource scarcity and global demand trends.
Zimbabwe, like its neighbor South Africa, is home to vast
mineral resources--especially precious metals--with major mining
firms like Anglo American PLC and Impala Platinum Holdings Ltd.
operating in the region. Despite this, poor infrastructure and
power problems has been an issue in terms of expanding the
industry.
President Mnangagwa said this policy would be in effect from
this month onwards with the reserves being held by the Reserve Bank
of Zimbabwe.
Impala Platinum, which mines PGMs in the country under Zimplats
Holdings Ltd., said it was working with the Chamber of Mines to
better understand the "evolving mining policy" in Zimbabwe.
It added that paying royalties in U.S. dollars and/or partly
paying in equivalent metal product doesn't materially alter the
cost burden in Zimbabwe on face value.
"However, this potentially constitutes a significant shift in
fiscal policy, especially considering governments present ability
to acquire refined metals through U.S. dollar revenue received,"
the company said.
Write to Yusuf Khan at yusuf.khan@wsj.com
(END) Dow Jones Newswires
October 10, 2022 09:47 ET (13:47 GMT)
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