The Financial Gazette

Clemence Manyukwe, Political Editor

MARANGE diamonds have contributed the most revenue to the fiscus, surpassing other minerals such as platinum and gold.
Despite controversy surrounding the awarding of diamond mining licenses to companies operating in Marange, figures released by Finance Minister, Tendai Biti, recently show that the firms have done more than any other mining company in terms of their contribution to the fiscus.
Biti said derisory contributions to treasury by other mining companies outside the diamond sector, offers compelling reasons for the institution of reforms.
“Currently, while mining exports for 2011 are in excess of US$2 billion, the contribution to the fiscus of the mining sector, excluding diamonds, will only be US$150 million. The dividend that will be paid to the State by two alluvial diamond miners by 31 December 2011 will be US$130 million,” said Biti during his National Budget presentation.
“Quite clearly, the disproportionate contribution of the rest of the mining sector is unacceptable, more so given that the effective mining tax rate in Zimbabwe is a mere eight percent.”
Nearly half a dozen mining companies operate in Chiadzwa.
Biti also confirmed that Cabinet had agreed on exclusive ownership of alluvial diamond claims and rights, as first reported by The Financial Gazette.
The minister said on a shipment basis, central bank figures show that between January and early October this year, mineral exports stood at US$1,7 billion.
Although platinum contributed much of the exports with 45 percent followed by gold at 24 percent, the Marange fields still proved to be the new El Dorado in terms of their contributions to government coffers, even though they had exported less than other companies.
The Finance Minister said US$600 million was expected to be paid to government from the sale of gems next year.
In the last few years, mining exports were said to have become a major mainstay of the country’s economic growth, contributing a projected 13 percent to Gross Domestic Product this year.
The sector is also projected to contribute half of this year’s total exports, estimated at US$4,4 billion, with a corresponding growth of 38,7 percent and 13,3 percent next year.
“In 2012, mining is anticipated to remain the major driving force behind overall economic growth, benefitting from further private capital injections, firming international commodity prices and anticipated initiatives to minimise electricity supply interruptions.
“Mr Speaker Sir, as indicated, a growth of 15,9 percent is projected for the mining sector in 2012,” the minister said.
“The employment potential is creation of more than 3 000 new jobs annually.
“Mining investment requirements over the next five years are estimated in excess of US$3 billion, broken down as follows, platinum, US$1,2 billion, gold US$1 billion and diamonds US$339 million.”