Harare – The government is said to have approved a $400 million five year diamond mining project to increase the value of returns in the capital intensive but viable industry, according to a report by the State broadcaster, ZBC News.
The development follows a renewed interest in the diamond mining sector which is being anticipated to increase value and production at a time when there is a transition from the alluvial precious gems to the conglomerate mining systems.
While diamond volumes have since January been on an increase, it is the need to realise full potential in terms of returns that has seen the government setting aside a budget of $400 million for expansion in the next five years.
Zimbabwe Consolidated Diamond Mining Company (ZCDC) Chief Executive Officer Dr Morris Mpofu told ZBC that the government which is the key shareholder in the firm has approved the project whose key targets include exploration works, expansion systems, and beneficiation or refinery plants among others.
“We are really working towards ensuring that the set targets can yield the full potential to unlock value in the sector with the main motive being towards accelerating growth in the short to long term,” said Dr Mpofu.
Zimbabwe’s diamond mining industry which has already endorsed the country’s vision 2030 objective of achieving a middle income economy premised on a gross domestic product (GDP) of US$65 billion is focusing on policies to attract more investors through the provision of machinery or working capital.
Zimbabwe resumed diamond auction earlier this month but attracted fewer international buyers than expected, the Minerals and Marketing Corporation of Zimbabwe said.
The auction – the third to be conducted this year – attracted 32 buyers mainly from Asia, the Middle East and Africa.
Zimbabwe is ranked among the top 7 diamond producers in the world. It is estimated that Zimbabwe produced over 14.5 million carats in 2012, including production from River ranch and Murowa mines.
However, despite these staggering statistics, the contribution of diamonds to the fiscus remain insignificant and government said it is in the process of formulating a new diamond policy, which will lead to the unbundling of the ZCDC to ensure more players are involved in the sector.
Apart from attracting new investments into the sector, the new policy would also ensure communities around the diamond fields benefit from the resource by imposing a legal requirement for meaningful corporate social responsibility programmes.
Tobacco is Zimbabwe’s biggest foreign currency earners followed by gold.
Last year tobacco exports topped $900 million, which was a marginal decrease from the $933 million the previous season.
Across the country, the area put under tobacco has slightly decreased from 110 518 hectares last year to 104 397ha.
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