The Zimbabwe Mining and Alloy Smelting Company (Zimasco) has reportedly fired almost all its workers, including managers, and ceased mining operations at Mutorashanga after the equipment meant to refine chrome ore failed to work.
The $25m equipment was installed in February at Zimasco's refinery in Kwekwe by Chinese contractors on behalf of Sinosteel Corporation. Chrome ore was transported from Mutorashanga to be processed there. Sinosteel, a Chinese state owned company, bought Zimasco in 2007. The Chinese giant is that country's second largest producer of iron ore.
An un-named manager who was fired last week said as a result of the equipment failure the company has closed supply stores at its Mutorashanga mine and fired its workforce. According to a Bloomberg news agency, the manager said the latest development brings the number of job losses to more than 500 over the last two years.
Small scale business operators in Mutorashanga said they 'have seen crime and poverty going through the roof' as a result of the closure of operations in the area. Zimasco has operated in Mutorashanga since 1910. The company operated alongside Zimbabwe Alloys which stopped mining last year.
A Kwekwe-based journalist said Zimasco's problems went much deeper. He said: 'Zimasco's problems are deeper than that of the failed equipment. They are retrenching all over. People might call it firing but as far as I know they are not firing rather they are forcing people to take retrenchment packages because they can't sustain operations anymore.'
The journalist said the company's problems started when the Chinese took over. He said: 'Even up to this date the workers are still wondering why the Chinese were brought in. Everyone in Kwekwe knows that the Chinese are not good for that company.'
In February, the company announced that it would be retrenching half of its three thousand workers to streamline costs. The company said the decision was a response to 'global market conditions' which had affected chrome prices since 2008. As a result, the management said, the company would henceforth undertake 'various cost cutting initiatives in all its operations.'
Zimbabwe has the world's second-biggest chrome reserves, after South Africa.