The Zimbabwe mining sector is targeting a 7% growth in 2023, propelled by expansion projects and rising mineral prices, despite a challenging tax regime and high lending rates. Projected output increases for gold, platinum, and diamonds, along with a rise in mineral revenue to US$6 billion by 2025, signal a recovery. Negotiations between miners and the government aim to address compliance burdens amidst an informal sector transition.
Zimbabwe’s mining sector anticipates a robust recovery amidst ongoing challenges, attributing this optimism to expansion projects and an expected rise in international mineral prices. The industry aims for a commendable 7% growth this year, surpassing the projected 5% for 2024 and 4% for the previous year, highlighting a positive trajectory despite economic obstacles.
Isaac Kwesu, the Chief Executive Officer of the Chamber of Mines of Zimbabwe (CoMZ), indicated that the mining output is forecasted to expand by approximately 7% in 2025. Additionally, mineral revenue is projected to rise by 10% to around US$6 billion, reflecting growth from US$5.5 billion in 2024. The anticipated increases in gold, platinum, and diamond production will significantly contribute to this progress.
Despite facing a stringent tax regime and elevated lending rates, the Zimbabwean government is intensifying the campaign against remaining formal companies, including mines. This strategy aims to counteract revenue losses stemming from a shift to the informal sector, where businesses are evading costly compliance associated with formally registered entities, thereby increasing the financial burden on those operating legally.
The government views the mining sector as a vital source of foreign currency earnings crucial to addressing its revenue crisis. In light of these challenges, Mr. Kwesu noted that miners are actively engaging in negotiations with the government, seeking to find a more sustainable operating environment while navigating the complexities of the current economic landscape.
In summary, Zimbabwe’s mining sector is poised for recovery in the near future, driven by expansion initiatives and favorable mineral price forecasts. The optimistic growth projections for the sector suggest resilience in the face of economic challenges, though ongoing government reforms and negotiations will be vital for sustaining this momentum. With anticipated revenue increases and production growth in key minerals, the outlook remains cautiously optimistic for the industry.
Original Source: africanminingmarket.com
