Tawanda Karombo Harare
MINEWORKERS in mineral-rich but struggling Zimbabwe may have to wait for a wage rise as the mining industry says it is beset with serious operational and cost challenges.
Zimbabwe has significant mineral resources spanning platinum, gold, diamonds, nickel, coal and iron ore.
These mineral riches, mainly concentrated along the lush Great Dyke belt cutting across the country’s Midlands region, have attracted investors such as Anglo Platinum, Impala Platinum (Implats), Rio Tinto and Metallon Gold among others, including some from Russia and China.
Adding to its attractiveness is the fact that most of the mineral deposits in Zimbabwe are closer to the surface when compared to South Africa, where gold and platinum mines are getting deeper.
Labour costs, though, are also manageable, according to experts, although a protracted wage dispute dogged the industry last year, culminating in a 5 percent wage increase deal between the Chamber of Mines of Zimbabwe and mining unions.
Mineworkers have been ever more disgruntled. They want to be paid more to be able to meet the rising cost of living.
In fact, the labour unions were expecting another wage increase this year despite Zimbabwe’s economy stagnating and productivity slumping.
Chamber of Mines of Zimbabwe president Alex Mhembere said this week that “the mining industry is facing very serious difficulties regardless of which metal you look at”.
The lowest-paid mineworker in Zimbabwe currently earns about $238.41 (R2 556) a month after the 5 percent wage increase awarded last May.
Implats spokesman Johan Theron told Business Report at the end of 2014 that the “key focus” for the world’s second-largest platinum mining firm this year would be to “sustain profitability as best we can through managing our cost base” and optimising production.
He added that at the current depressed platinum metal prices, “approximately 75 percent of the industry is expected to run at a loss” this year, heightening the need to contain costs.
Mineworkers’ unions in Zimbabwe say the mining companies negotiated in bad faith and that most of them, especially the platinum firms, were in “luxury” and could pay more than the 5 percent wage increase agreed on.