The Zimbabwe’s mining sector has generated over US$2.6 Billion thus expanding the mining industry by 8.5%, contributing to the Gross Domestic Product (GDP) of 3.7% since last year.
This was said by the Minister of Mines and Mining Development, Mr Winston Chitando that, despite negative pressures on mineral commodity prices, revenues in the mining sector have continued to rise.
Chitando said the mining sector continues to be one of the key drivers of economic development in the country.
“Zimbabwe’s mining sector remains pivotal in driving economic development in the country. It also has contributed over 40,000 formal jobs and 200,000 artisanal and small scale miners and generated over US$2.6 Billion to our economy.”
“The mining sector contributes to other sectors of the economy through backward and forward linkages. The sector provides requisite feedstock to the manufacturing sector through forward linkages,” he said.
He added that, for the government to achieve its quest for a middle class economy by 2030, they will have to increase gold production to 100 TPY at a growth rate of 18% per annum.
“The mining sector will play a pivotal role in our quest to become a middleclass economy by 2030. However, in order for us to accomplish this, the mining industry will have to increase its output.”
“By raising gold production to 100 TPY, we will require a compounded growth rate of about 18% per year. Such growth is feasible if we can develop innovative solutions to our production processes,” Chitando added.
Minister Chitando further stated that, they will support manufacturing sector through provision of advanced equipment to enable exploration and extraction of minerals.
However, Chamber of Mines economist Mr Pardon Chitsuro recently said, “the mining industry is hopeful that all short term viability matters that include the high operating costs, foreign exchange constraints, access to capital and general ease of doing business reforms will be resolved during the year.”
He said the sector was in ‘dire need of capital’ to replace obsolete equipment.
“In 2018, the mining industry requires around $777 million to optimise production, with $401 million needed for sustaining operations and $376 million for replacement and expansion capital,” said Mr Chitsuro.
Mining remains a critical source of foreign currency for Zimbabwe contributing 59 percent of export earnings in 2017.