Business / Economy
Zimbabwe miners submit indigenisation plan, fall below government demands
12 Jun 2011 at 23:29hrs | Views
Miners operating in Zimbabwe have submitted proposals for how they will meet the indigenization-law requirements that fall below government demands, and that could lead to the country seeking better offers, an official on the constitution-reform committee said Sunday.
In March, Zimbabwe published regulations and told mining firms they had to submit preliminary plans by May outlining a program to sell 51% of their assets to local bodies by Sept. 25, the first tangible step in implementing the indigenization law since it was enacted in 2008.
Most miners have submitted a plan to sell 26% instead, Christopher Mutsvangwa said on the sidelines of a summit in Johannesburg.
The indigenization rollout is coming as political parties wrangle over the next election date. President Robert Mugabe's political party Zanu PF said they continue to plan for elections in early 2012, while the opposition and other civi- society organizations operating on the ground against the current government are demanding elections are delayed until there are reforms in the country's constitution and security situation.
Miners in Zimbabwe include Anglo Platinum Ltd., a unit of Anglo American PLC, which is in the process of ramping up its Unki platinum mine with full production expected by 2013, and Impala Platinum Holdings Ltd., which is in the process of expanding its operaions.
"We think they could go higher," Mr. Mutsvangwa said. "We will now negotiate. If they continue to say 26% is the maximum we will go to the open market to see if others are willing to go beyond 26%.
Mr. Mutsvangwa said the government will be more flexible about greenfield negotiations.
Previous comments from ministers suggested Chinese companies would be exempt from the indigenization requirements.
"Chinese companies are prepared to pay a higher price, why shouldn't they be given an opportunity," Mr. Mutsvangwa said. "We are happy to give incentives to new investors."
Mr. Mutsvangwa said the Chinese are willing to buy diamonds from the country whereas much of the international community is placing sanctions on aspects of the economy.
Mr. Mugabe has threatened to target companies from Western countries that have hit him and his allies with sanctions.
Where Zimbabwe will get the money to make the deals is a major concern. Last year, the government sought outside investors to help fund its debt-ridden steel company because it didn't have the money itself.
In March, Zimbabwe published regulations and told mining firms they had to submit preliminary plans by May outlining a program to sell 51% of their assets to local bodies by Sept. 25, the first tangible step in implementing the indigenization law since it was enacted in 2008.
Most miners have submitted a plan to sell 26% instead, Christopher Mutsvangwa said on the sidelines of a summit in Johannesburg.
The indigenization rollout is coming as political parties wrangle over the next election date. President Robert Mugabe's political party Zanu PF said they continue to plan for elections in early 2012, while the opposition and other civi- society organizations operating on the ground against the current government are demanding elections are delayed until there are reforms in the country's constitution and security situation.
Miners in Zimbabwe include Anglo Platinum Ltd., a unit of Anglo American PLC, which is in the process of ramping up its Unki platinum mine with full production expected by 2013, and Impala Platinum Holdings Ltd., which is in the process of expanding its operaions.
"We think they could go higher," Mr. Mutsvangwa said. "We will now negotiate. If they continue to say 26% is the maximum we will go to the open market to see if others are willing to go beyond 26%.
Mr. Mutsvangwa said the government will be more flexible about greenfield negotiations.
Previous comments from ministers suggested Chinese companies would be exempt from the indigenization requirements.
"Chinese companies are prepared to pay a higher price, why shouldn't they be given an opportunity," Mr. Mutsvangwa said. "We are happy to give incentives to new investors."
Mr. Mutsvangwa said the Chinese are willing to buy diamonds from the country whereas much of the international community is placing sanctions on aspects of the economy.
Mr. Mugabe has threatened to target companies from Western countries that have hit him and his allies with sanctions.
Where Zimbabwe will get the money to make the deals is a major concern. Last year, the government sought outside investors to help fund its debt-ridden steel company because it didn't have the money itself.
Source - online.wsj.com
