Zimbabwe Miners Not Worried By New Royalties Proposal11 months ago
Zimbabwe’s miners are not losing sleep over President Emmerson Mnangagwa’s announcement on Sunday that the government would require companies mining gold, diamonds, lithium and platinum group metals (PGMs) to pay part of their royalties in refined metal rather than cash.
The Chamber of Mines, which represents major mining companies, said the pronouncement would not increase existing royalty rates.
Speaking to Reuters, Chamber of Mines Chief Executive Isaac Kwesu said they “respect” the government’s position. He said:
We respect the government’s position. It’s their prerogative. All they are saying is they are changing payment modalities.
One of the foreign companies operating in Zimbabwe, Impala, said it was working with the Chamber of Mines to understand and respond to the new policy.
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In an emailed response to Reuters, Impala spokesperson Johan Theron said:
Paying royalties in U.S. dollars and or partly paying in equivalent metal products, on face value, does not materially alter the cost burden in Zimbabwe.
Mark Learmonth, the Chief Executive of Caledonia Corporation, one of the largest gold producers in Zimbabwe told Reuters:
We have not seen the detailed mechanisms whereby this proposal may be implemented, but I do not think it would have any financial or operational effect on our business.
According to the Zimbabwe Revenue Authority (ZIMRA), mineral royalties accounted for 2.8% of Zimbabwe’s tax revenue in 2021. | Nasdaq