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Turmoil in Zimbabwe's gold mining sector

by International Crisis Group
06 Dec 2020 at 08:15hrs | Views
Over the past year, a wave of violence has rocked Zimbabwe.

Armed gangs, alternatively portrayed as consisting of or preying upon small-scale miners, have wreaked deadly havoc, especially in the country's many gold mining areas.

Civil society organisations rang alarm bells in October 2019, when they recorded over 100 casualties in the space of three months near a single town, though this violence represents only a fraction of the toll around the gold mines dotted around Zimbabwe's 10 provinces.

By year's end, observers were speaking of a "national conflict" and police warning that gang violence threatened the country's stability.

Such talk helped jog the government into action.

In early 2020, police moved against the gangs in what, by the official account, was one of the largest such operations in Zimbabwe's history, arresting thousands.

Zimbabwe can ill-afford such turmoil, as Covid-19 and the consequent global slowdown deal further blows to its already reeling economy.

In 2019, the economy contracted by over 8%, inflation spiked and expected foreign investment did not appear. Social and political conditions deteriorated markedly.

As a result, some 90% of Zimbabweans are living in poverty and 60% are considered food-insecure, placing Zimbabwe's food insecurity fourth highest in the world.

This trajectory has continued into 2020, leading regional hegemon South Africa to spell out its concerns that its neighbour is in serious crisis.

Gold is central to the economic revival plans of Zimbabwean President emmerson Mnangagwa, who took over from the ousted robert Mugabe in 2017.

In October 2019, Mnangagwa and Mines minister Winston Chitando announced plans to expand the government's gold revenue to $4 billion per year by 2023, an ambitious fourfold increase in four years.

Since the virus-induced global economic downturn, gold, already Zimbabwe's largest foreign exchange earner, has only grown in importance.

While the prices of the country's other export commodities, such as platinum, nickel and diamonds, have dropped precipitously, the world gold price has soared, as investors have sought a safe haven during the slowdown.

If Zimbabwe is to be "open for business", as Mnangagwa has repeatedly pledged since taking office, the gold industry in particular must thrive.

The gold sector does not consist exclusively, or even mostly, of big business. Artisanal miners men and women who mine on their own or in small groups using little or no machinery -and small-scale mining, which involves slightly larger operations with some mechanisation, produce the majority of Zimbabwe's gold.

In 2019, artisanal and small-scale miners combined were responsible for 63% of reported gold production, although it is unclear whether artisanal or small-scale mining is the bigger contributor of the two.

Amid the collapsing economy, an estimated 1,5 million people have turned to artisanal mining as a safety net.

This trend will likely persist as Covid-19 brings additional hardship and spurs urban-rural migration.

Artisanal gold miners play a curious role in Zimbabwe's political economy.

On one hand, they are an irritant to the industrial mining companies that hold most of Zimbabwe's gold exploration rights.

Their encroachment on industrial mining claims prompts the government to clear them out in mass arrest campaigns.

The majority of those picked up in the early 2020 sweep had committed no acts of violence.

They were merely mining without a licence or in the possession of tools that artisanal miners commonly possess for their work but that could be used as weapons.

On the other hand, artisanal miners are an important constituency in Zimbabwe's patronage politics, particularly as practiced by the ruling Zanu-PF.

Several Zanu-PF politicians have been fingered as "patrons" of illegally encroaching artisanal miners, or even machete gangs, and some mobilise such groups against rivals.

Some observers contend that whoever controls the gold, will control and rule Zimbabwe

Some observers contend that "whoever controls the gold, will control and rule Zimbabwe", referring to power struggles between party factions loyal to Mnangagwa, on one side, and his vicePresident Constantino Chiwenga, on the other.

The latter is seemingly positioning himself to challenge Mnangagwa for Zanu-PF leadership ahead of the 2023 elections, although another, possibly stronger challenger, Foreign minister Sibusiso Moyo, has also emerged.

Though violence in gold mining areas has apparently diminished in 2020 (Covid-19 travel restrictions make it difficult to be sure), there is every reason to believe it will flare up again, especially as elections approach.

Meanwhile, pressure on Mnangagwa to make the broader governance reforms he has promised since assuming power is mounting from outside Zimbabwe.

In November 2019, South Africa made statements that blame Zimbabwe's economic malaise on its politics.

The African Peer review Mechanism, Africa's self-assessment tool for good governance, which Zimbabwe laudably joined under Mnangagwa's leadership in early 2020, is unlikely to give the president glowing reviews.

The International Monetary Fund (IMF), which holds the key to external financial support, publicly criticised the state's financial links to Kudakwashe "Kuda" Tagwirei, a key Zanu-PF donor and a prominent adviser to both Mnangagwa and Chiwenga.

This is an extract from the International Crisis Group titled: All That Glitters is Not Gold: Turmoil in Zimbabwe's Mining Sector

*Abridged version

Source - the standard