Local manufacturers need to produce at least 40% of equipment and consumables required by the mining industry. Mines and Mining Development minister Walter Chidhakwa said government was on a drive to have most of the sector’s requirements procured locally.
BY MTHANDAZO NYONI
According to the 2015 mining industry survey, the mining industry spent about $720 million of the $1,8 billion generated by the mining industry in 2015 on supplies imports.
Speaking at the Mining, Engineering and Transport 2016 conference in Bulawayo last week, Chidhakwa said it was high time local companies started producing for the mining sector.
“Manufacturers and suppliers, we expect you to manufacture mining equipment. We expect you to manufacture various consumables used in the mining sector,” Chidhakwa said.
“If yesterday you were going to look for a piece of equipment to sell to Zimplats, go out there and get a franchise to manufacture these goods needed by our mining firms. Don’t import on their behalf but manufacture on their behalf. Talk to mines and ask them what items they require.”
Chidhakwa said Zimbabwe’s mining companies had a legal requirement to purchase locally-manufactured goods.
His sentiments were echoed by Chamber of Mines of Zimbabwe (CoMZ) president Toindepi Muganyi, who said the mining industry remained an important market for output from other sectors.
“The sector currently receives inputs amounting to 11,2% from the manufacturing sector, 4% from electric power, 3,2% from iron and steel products, 35% from distribution, 2,3% from non-electrical machinery and equipment, 1,3% plastics and rubber, 1% from fibres, matches, ink and other chemicals, and 20% from mining itself,” he said.
Against this background, Muganyi said suppliers should thrive to improve on quality of the product, the cost and delivery lead times, to tap into this huge opportunity
Chidhakwa said there was need for government to work hard to promote small-scale miners due to the role they played in the sector.
He said his ministry had started a programme of providing technical expertise to small-scale gold miners and had instructed the Zimbabwe School of Mines to train small-scale miners who were into gold production.
“We need to grow the small-scale gold sector because about 40% of our gold is coming from these players. We are so much committed to gold production; therefore, we are doing a lot of things in the form of financing and training to improve gold production,” he said.
Chidhakwa said the government and mining industry should continue working together to consolidate the sector’s achievements while crafting strategies for economic development.
He said this was necessary as the mining industry anchored the country’s economic revival.
“We need each other as government and industry. There is need to strive for a cordial symbiotic relationship between the mining industry and key stakeholders, which should be based on a win-win situation to facilitate and promote sustainability of each other’s businesses.”
According to CoMZ, the county’s mining sector is expected to recover this year, with a number of minerals having already recorded significant growth in the first five months of 2016 compared to 2015.
CoMZ noted that gold for example had recorded growth output of 21% while platinum grew by 35% and nickel increased by 8% in 2015.
However, coal, chrome and diamond output remained below the previous year levels, the chamber noted.
Gold is expected to record 24 000kg, platinum 16 000kg, palladium 13 848kg, nickel 17 000 tonnes, coal 3,726 million tonnes and chrome 220 000 tonnes.
“The medium to long term prospects of the industry remains bright, with output for most minerals expected to record phenomenal growth, as both government and the private sector aim to address the structural distortions and cost of doing business in Zimbabwe,” Muganyi said during the Mine Entra conference.
The mining sector currently contributes in excess of 10% to gross domestic product, more than 50% to national exports, between 8-12% of fiscal revenue, more than 50% to foreign direct investment and creates more than 45 000 formal jobs.