Zimbabwe’s government has lifted the ban on chrome ore exports with immediate effect after four years of the prohibition failed to ignite local processing.
The move was part of a raft of reforms targetted at boosting mineral revenue inflows.
The government also scrapped a tax on the export of chrome ore and lowered power tariffs for chrome producers.
The development is seen breathing life into companies such as state-owned locomotive operator NRZ, Chinese-owned chrome miner Zimasco and bring relief to thousands of workers whose jobs were at risk as mines struggled.
Mines minister Walter Chidakwa said the ban had failed to stimulate activity in the ferrochrome mining industry due to outdated equipment, weakening prices and unsustainable energy tariffs.
Lifting the ban would enable chrome ore producers to mobilize financial resources for capitalisation to invest in modern technology in smelting, as well as address the plight of the small-scale chrome ore producers.
Government has also reviewed royalty fees for chrome ore from two percent to five percent, but the export tax of 20 percent has been removed to allow producers to generate income to increase smelting capacity.
“Government, has with immediate effect, lifted the ban on the export of chrome ore to allow for the export of up to thirty (30) million tonnes of chrome ore (lumpy, fines and concentrates) over and above the export of processed ferrochrome,” Chidakwa said in a joint press briefing with finance minister Patrick Chinamasa.
“In addition, in order to assist chrome ore producers to operate viably to allow them to create investment capacity in smelting, Government decided to reduce electricity tariffs from 8.0 US cents to 6.7 US cents per kilowatt hour for chrome ore producers, ZESA shall implement the approved electricity tariff, with immediate effect.”
Chidakwa said the threshold of up to 30 million tonnes of chrome ore shall be subject to review based on desired developments in the establishment of additional smelting capacity in the country. In line with the Zimbabwe Agenda for Socio-Economic Transformation, government’s ultimate objective is to create adequate smelting capacity for value addition or beneficiation purposes.
He said prior to the suspension of export of chrome ore in 2011, total prepayments amounting to $9 432 335 were made for exportation of lumpy and concentrate chrome ore totaling about 77 000 metric tonnes.
“This tonnage was not shipped following the ban and remains an obligation to the country. With the lifting of the ban, Government will facilitate the export of all the encumbered chrome ore to the beneficiary importers,” Chidakwa said.
“The optimum production, smelting and export of chrome ore would result in major producers such as Zimasco being able to generate income for expanding their smelting capacity. The economic livelihoods of small scale producers would also be restored, and revenue to Government would be boosted through Royalty fees payments, and other taxes such as corporate tax and PAYE.”
Chidakwa said all exports of chrome ore shall be conducted under the auspices of the Minerals Marketing Corporation of Zimbabwe (MMCZ) and facilitated by the Reserve Bank of Zimbabwe (RBZ) and the Zimbabwe Revenue Authority (ZIMRA).
Also addressing the same press briefing, Chinamasa said cabinet has also resolved to withdraw idle chrome claims being held by miners for speculative purposes.- The Source
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