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Midzi in trouble over mines policy

MINES minister Amos Midzi has run into serious trouble over his recent statements that government plans to acquire 51% of foreign-owned mining companies, with 25% grabbed for free.

Government sources said Midzi had stirred a hornet’s nest in official c

ircles and would soon be censured for his remarks by higher authorities, including President Robert Mugabe.

A press conference scheduled to be addressed by Reserve Bank governor Gideon Gono in the presence of economic affairs ministers on Wednesday was cancelled at the last minute to give senior ministers time to “set the record straight by clearly spelling out that Midzi misdirected himself in uttering those misleading statements”, sources said.

“Midzi has created problems for himself and government over the mines controversy,” a source said. “He will be censured either publicly or in private by Mugabe or any other senior minister next week.

His remarks have caused confusion and panic in the local business and international communities.” Midzi was not answering his cellular phone yesterday when sought for comment.

Cabinet was said to be divided over the matter. Sources said ministers with interests in mining wanted the law on indigenous shareholding while others were against it. It was also said the issue was partly a publicity stunt by Midzi after Mugabe last month suggested he was one of his incompetent ministers.

After Mugabe’s remarks pointed at the ministries of Mines, Industry and Trade, and Agriculture, the relevant ministers have been jumping around trying to be seen to be doing something. This was widely seen as desperate bids to keep their jobs ahead of a looming cabinet reshuffle. Mugabe said most of his ministers were non-performers but it is not clear if he will dump the deadwood.

However, the writing has been on the wall for Midzi over the mining issue. Gono was recently quoted in the state media as saying the mines debate was a “hot issue” during his recent trip to Washington for the International Monetary Fund (IMF) executive board meeting on Zimbabwe’s arrears.

Sources said the IMF was disturbed by the policy which has the hallmarks of nationalisation and government’s chaotic land reform programme. Midzi has been trying to do some damage control by denying that his policy amounted to nationalisation.

The Zimbabwe Chamber of Mines and other stakeholders have said the policy proposals will damage mining, one of the few performing sectors of the economy. Agriculture, the economic mainstay, and manufacturing, have already crumbled due to policy blunders.

The mining sector is a key pillar of the Zimbabwean economy, earning US$626 million last year, which represents 44% of the country’s total foreign currency revenues. It contributes 4% to gross domestic product.

Implats CEO Keith Rumble met Mugabe last week to discuss the issue. Implats, the world’s second biggest platinum producer, has an 86,7% interest in Zimplats.

Zimbabwe, holding the world’s richest platinum deposits after South Africa, is the main area of future growth for Implats. South Africa and Zimbabwe hold about 90% of the world’s known platinum reserves.

Midzi visited Zimplats on Monday in a bid to allay investor fears of a looming mine grab. Although he did not change his line, he appeared to be on the retreat.

Sources inside government who see the economy as the potential cause of Mugabe’s downfall, were angry with Midzi because they believe the seizure of mines could be fatally damaging to an already reeling economy. — Staff Writer.

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