Parliament calls on government to investigate Kasukuwere over Marange–Zimunya Community Share Ownership Trust within 14 days

4.0    ORAL SUBMISSIONS TO THE COMMITTEE

4.1 Marange-Zimunya CSOT Board

The Board of the Marange-Zimunya CSOT appeared before the Committee twice, on 13 and   27 February, 2014. The Chairperson of the Trust, Chief Marange, informed the Committee that in June 2013, the Trust received USD 400,000 in their account. He further informed the Committee that the Trust was astonished about the amount deposited given that during the official M-Z CSOT launch, a cheque of USD 1.5 million was displayed. Chief Marange pointed out that they were surprised to receive USD 200,000 apiece from Marange Resources and Mbada Diamonds instead of the USD 50 million, USD 10 million apiece from the 5 major mining companies in the area.

 4.1.2 The Trust Secretary Mr. Chinaka highlighted that the Trust was facing challenges in managing the public expectations as the mining companies were not remitting funds into the Trust. He indicated that the communities were expecting projects to the tune of USD 50 million but the Trust was working with the sum of USD 400,000. Meeting public’s expectation was an unattainable task, a point reinforced by Chief Marange who lamented that the rumour mill at the time was awash with stories that the Trustees were abusing the Trust funds. Chief Zimunya also questioned why the USD 1.5 million which was displayed at the launch amid pomp and ceremony had not been remitted to the Trust. He accused the mining companies of misleading and lying to the President on the amount of money to be released. Chief Zimunya further challenged the National Indigenisation and Economic Empowerment Board (NIEEB) to explain to the Trust and the Committee why the rest of the money had not been released.

 4.1.3 Chief Zimunya informed the Committee that there was interference by the Provincial Leadership in the operations of the Trust and within the mining companies. He alleged that this interference by the political leadership could be the reason behind the failure by the Mining companies to fulfill their pledges. He emphasised interference by ZANU PF political leadership in the Province led by Mr. Didymus Mutasa, the then Head of Manicaland Province who has since been expelled from the ruling Party. He further alleged that there were cash donations and motor vehicles donated to individuals and not to the Trust which could have contributed to the companies not meeting their obligations. Chief Zimunya challenged the Committee to go on the ground and investigate why the funds had not been remitted into the Trust account two years after the launch of the CSOT.

4.2 Marange Resources

4.2.1 On 7th March, 2014, Marange Resources made its presentation to the Portfolio Committee on Youth, Indigenisation and Economic Empowerment. The company informed the Committee that it fully complied with the Indigenisation and Economic Empowerment Act: that it was 100% Government owned; and 100% Zimbabwean in its management structure. The company reported that 92% of profits generated were spent in the local economy, and that only 8% was used to source raw materials that could not be sourced locally. In terms of employment, the company reported that 54% personnel were recruited from Marange-Zimunya area and 46% from other areas of the country; 90% of workers were said to be males while 10% were females; and that 75% of 589 workers were youths, in the age group of 40 years and below.

4.2.2 The Committee was informed that in its social corporate responsibility, a total of $22 million, between 2011 and 2013, had been disbursed of which 86% went to the relocation exercise, where out of a target of 350 houses, it built, 184 houses and relocated 116 households. Other areas of Social Corporate Responsibility include education, sport, and subsistence assistance including school feeding programmes for local schools, and distribution of food hampers and agricultural inputs to households, as well as construction of community projects which include Marange Vocational Center, Marange Hospital donations, Murwira Children's Home, and Zororai Old People's Home.

4.2.3 The Committee was informed that the company's contributions to its Corporate Social Responsibility projects had been hampered by liquidity constraints in the economy; as a result the company was facing acute shortage of working capital and capacity constraints. Consequently, it was experiencing difficulty in contributing towards the $50 million for the M-Z CSOT. However, the company informed the Committee that it had made a contribution of $200 000 from the 2 million dollars it was supposed to contribute towards the Trust Fund. The company further alleged that from the onset, the pledges were prorated in line with the capacity of the company. Thus, Marange Resources would contribute 2 million and not 10 million. The Committee heard that there was no documentation on the pledges to be paid to the Marange-Zimunya Community Share Trust.

4.3 Diamond Mining Corporation (DMC)

4.3.1 On 07 March, 2014 Diamond Mining Corporation (DMC) made its presentation to the Committee. The Committee heard that the diamond mining company was summoned for a meeting at the Ministry of Mines chaired by the Permanent Secretary, Prof. Gudyanga, to discuss the CSOT. The discussion centred upon a collective contribution of USD 10 million which was needed as a capital investment by the trustees on a diamond mining project on behalf of the community. The company alleged that during the discussion it was understood that a concession area was already allocated to the community by Government and that capital investment was all that was needed. The company further alleged that of the USD 10 million to be paid, each company was to contribute USD 1.5 million dollars. The company informed the Committee that pursuant to the launch of M-Z CSOT, it expressed commitment to pay USD 1.5 million in small amounts. The company further mentioned that contrary to its pledge, it later learnt that USD 1.5 million was required immediately and as a lump sum, an undertaking that was not achievable for the company. The Committee learnt that the matter was brought up at several meetings held between the mining company and ZMDC wherein clarification was sought and correction was called for. The company alleged that ZMDC responded by saying that the matter was decided at a higher level and would be addressed in due course but was later advised by ZMDC not to make a contribution to the CSOT.

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