Independent Online

Monday, July 4, 2022

Like us on FacebookFollow us on TwitterView weather by locationView market indicators

#ZimbabweShutdown: SA mining companies weather the storm

Published Jan 21, 2019


HARARE – Platinum mining operations at Mimosa and Zimplats – the two Zimbabwean platinum assets in which Impala Platinum has interests – were not affected by the #Shutdown protest action that rocked Zimbabwe and disrupted economic activity last week.

Implats controls Zimplats, while it jointly owns Mimosa together with Sibanye Stillwater, making it the biggest platinum investor in the troubled southern African country. Anglo Platinum is the other platinum group metals producer as it controls the Unki mine, which is set to commission a smelter plant in the next few weeks.

Story continues below Advertisement

South African investors have largely maintained their investments in Zimbabwe, despite currency woes and rising operating costs as local inflation spirals out of hand. Implats said its mining operations had not been affected by the strike action, although its head office in Harare was affected by the #Shutdown demonstrations over a massive hike in fuel prices.

“Demonstrations were mostly centred around the urban areas, which impacted some of our head office workers in Harare. 

"Our mining operations were not directly impacted by the demonstrations,” said Implats spokesperson Johan Theron on Friday.

Mining companies are already struggling against the backdrop of the government taking a portion of their foreign currency earnings in exchange for bond notes that have continued to lose value. Operating costs in the local unit have been surging, with Zimstats saying on Thursday that the December rate of inflation had soared to 40 percent.

Implats said it was concerned about the developments in Zimbabwe even though it had been better off compared to other South African companies there, such as Standard Bank, Nedbank and Pick n Pay, among others, that had to shut down operations during the strike action. 

The Zimbabwe Congress of Trade Unions and bank workers, among other unions, called for the strike action against the rising cost of living after the fuel price hikes which grounded productivity in Zimbabwe from Monday to Wednesday last week.

Story continues below Advertisement

“We are obviously concerned about recent developments and continue to actively engage the government of Zimbabwe to sustain our operations and ability to earn hard currency for the country,” Theron added.

Sources in the mining sector said some mine workers in the country were already getting their wages in US dollars, which places them at a better position compared to their counterparts, who receive their salaries in the local currency.

Announcements that the government intends to re-introduce the Zim dollar – abandoned in 2009 after record inflation – have stoked up fears of further erosion in the value of wages of Zimbabwean employees. Implats said Zimplats and Mimosa received their “revenue in US dollars” and highlighted that the company was hopeful it “would be able to continue remunerating employees in hard currency to secure the buying power of their wages”.

Story continues below Advertisement

The chamber of mines of Zimbabwe says currency issues are of major concern for mining chief executives in the country.


Related Topics: