Zimbabwe’s Finance Minister, Mthuli Ncube has ordered mining companies to pay 50% of mining royalties through physical submission of the commodities in a move envisaged to strengthen exchange rate stability.
Delivering the 2023 National Budget, tje finance minister said measures were enshrined under the Statutory Instrument 189/2022.
“In order to boost national reserves and hence strengthen the economy’s resilience against external shocks, Government promulgated Statutory Instrument 189 of 2022, which compels miners of gold, lithium, diamond and platinum to settle 50% of payable royalties due to government through physical delivery of these commodities,” he said.
Ncube said the measures will buttress the country’s foreign currency reserves and sustain the current exchange rate stability by providing backing for the domestic currency.
The measure will be accompanied by a 10% payment in foreign currency cash and 40% in local currency.
“Platinum Group Minerals miners currently do not have refining facilities, hence, sell semi-processed concentrates for further processing.
“Section 302 of the Constitution of Zimbabwe specifies that all government revenues, including royalty revenue, shall be deposited into the Consolidated Revenue Fund.
“I, therefore, wish to emphasise that the royalties paid in the form of minerals shall continue to be accounted for,” he said.
Zimbabwe earned about US$5 billion from mineral exports in 2021, as investments by mining entities in recent years boosted output, and placed the country firmly on course to meet its target of a US$12 billion mining industry target.
Government contends that the mineral output benefitted immensely from deliberate efforts to grow one of the country’s economic sectors since the Second Republic, led by President Emmerson Mnangagwa, assumed power in 2017.
