Government will not compel mining companies in the country to list on the Zimbabwe Stock Exchange as such policy perspective is not in line with the vision of the new dispensation, a Cabinet minister has said. Mines and Mining Development Minister Winston Chitando told the Chamber of Mines Annual General Meeting in Victoria Falls on Saturday that previous reports on the issue of listing had caused panic and disquiet among investors.
"Reports that mining companies will be compelled to list on the stock exchange caused panic. The Chamber of Mines actually phoned me about the issue. Zimbabwe will not compel mining companies to list as this does not fit into the new economic dispensation," Minister Chitando said.
Reports that Government held plans to compel mining companies to list on the ZSE stemmed from provisions that were proposed in the Amendments to the Mines and Mining Development Bill, currently before Parliament, which has been on the cards since 2014. However, the policy position, which was driven by reasoning that mining companies including foreign-owned multinationals control huge deposits of finite mineral resources, was a policy position of the previous administration.
This policy thrust would need to or has been scrapped from the current legislation through the ongoing amendments to the mines law, which had been scheduled to be completed by March, but missed the deadline over issues that need to be resolved through public consultations.
Zimbabwe is home to several mining companies including multinationals such as Impala Platinum's 87 percent owned Australia Stock Exchange Zimbabwe Platinum Holdings, Aquarius and Sibanye Stillwater 50-50 owned Mimosa Mining Company, Unki Mines-all in platinum mining as well as giant gold producers Freda Rebecca and Metallon Gold Corporation.
All these mining entities are not listed. Under the new dispensation Government, has come up with initiatives to lure foreign investment, which has started to pay dividends with several multimillion dollar deals being signed.
It is believed the huge investor interest in Zimbabwe is being driven by recovery in confidence, following 37 years of isolation from global partners.
In its efforts to assure and incentivise investors, Government has amended the indigenisation law to a new structural arrangement that limits the definition and application of the 51/49 law to just two minerals, platinum and diamond, which might also be liberalised once a value addition and beneficiation policy, expected mid this year, comes into play.
Meanwhile, Minister Chitando said Government will from next year start to strictly enforce the standing rules and legal provisions regarding protection or retainment of special mineral rights, requiring holders of mining title to either demonstrate productivity or invest significantly, as opposed to retain them merely through regular payments for the assets.
"Protection of precious mining title shall now be based on work or capital expenditure not payment as is the case now. Effective January 2019, we shall strictly enforce the law on precious mining title, as a ministry, we should admit we have not been strictly observing the law," he said.
"Instead of protection by production, we have been doing it by payment. This, (protection by work or capital investment), is not new policy but a provision in our legislation we are simply going to strictly enforce," the minister said.