, pub-3787448768440954, DIRECT, f08c47fec0942fa0 [google-translator]

99 percent of ZIMASCO chrome contracts awarded to Chinese miners

By Business Reporter – Wednesday 25 March 2020

LOCAL NEWS – HARARE (Mining Index) – SMALL-SCALE chrome miners have expressed concern over the parcelling out of chrome tributaries by Zimbabwe Mining and Smelting Company (ZIMASCO), with the mining company accused of side-lining local chrome miners in favour of small-scale Chinese miners.

In 2007, Sinosteel Corporation, China’s second largest iron dealer acquired 67 percent stake in ZIMASCO, becoming the majority shareholder.

The ferrochrome producer and exporter used to produce 210 000 tons of high-carbon ferrochrome per year, nearly all of it mined along Zimbabwe’s mineral-rich Great Dyke.

“Sinosteel is a Chinese parastatals which controls ZIMASCO hence the allocation of chrome wash plants to Chinese firms,”

“I have been a Zimasco tributor and contractor for over 15 years and all the transformation has been happening under my nose. The situation is now unsustainable and undesirable. Are you aware that ZIMASCO’s focus from 2016 to 2017 has been on processing concentrates where 99 percent of the contracts are given to the Chinese nationals who then offload the concentrates at very low prices to ZIMASCO when sold within Zimbabwe? And who knows what happens when the concentrates are paid off when they reach China?”

“There is need for serious investigations here. No support is coming our way in terms of equipment from ZIMASCO. We are exposed to all sorts of safety issues, very high mining costs, serious chrome price cuts and mining profitably has been a thing of the past. We need help please,” said Martin Chitohwa, a mining contractor at ZIMASCO.

Responding to Chitohwa, Zimbabwe Miners Federation (ZMF) vice president Lindi Mpofu commented;

“Ministry of Finance and Economic Development, Zimbabwe Revenue Authority (ZIMRA) and the Reserve Bank of Zimbabwe (RBZ) should look into the matter to ensure no transfer pricing takes place.”

Chrome miners also noted ZIMASCO was signing out mining tributors as subcontractors, covering up or cushioning themselves against the ‘use it or lose it’.

In the 2020 budget, government announced the enforcement of the “use it or lose it” principle to prevent speculative hoarding of claims across all minerals.

Chrome miners are advocating for the implementation of favourable measures that would protect local chrome industry, at the same time attracting foreign investors.

Mpofu urged government to investigate and look into issues raised by chrome miners.

“Government should intervene to encourage the promotion of indigenous involvement of our small scale miners as this will help the economy as the majority of the revenue generated, less the cost of equipment will remain in Zimbabwe and be reinvested into Zimbabwe by small scale miners,” said Mpofu. ENDS// Twitter @IndexMining Facebook @MiningIndexNews LinkedIn @MiningIndex

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