HARARE: Govt is working on the reduction of electricity tariffs for the mining sector in a bid to save the sector that is facing viability challenges due to a decline in commodity prices at the international market.
Minister of Mines and Mining Development Walter Chidhakwa told NewsDay on the sidelines of the mining products from three French companies Verlinde, Manitou and Motul on Wednesday of the impending electricity tariff reduction.
Chidhakwa said commodity prices have been on a downward trend and gold in particular has been very unstable affecting the performance of the companies.
“We need to do something about the price of power and the availability of power. We finished discussions with the Energy minister and Finance minister. We are looking at supplying and lowering the tariff, for now we are spending time on the mining sector. I am confident that between the three of us we can come up with a solution,”he said.
Mining companies were paying 12 cents kilowatt per hour when commodity prices were high and the tariff was unsustainable given the changes at the commodities market internationally. Chidhakwa said the country could not have mining companies go for care and maintenance and have many job losses. The mining sector has been the main driver of the economy since 2009 and it was being affected by the fall in commodity prices.
The sector was expected to grow by 3,5% this year. But Chidhakwa said the sector will decline this year due to power challenges and decline in commodity prices. “I think it (mining sector) will decline and exports would not be as huge as last year due to issues of production resulting from power issues and for the few days that the companies lost power they have been affected,” he said.
He, however, applauded the coming in of the three French companies as it will help mining companies access products locally and at cheap prices. He said the companies would bring in consumables for the mining sector and considering that there has not been retooling for the past 20 years.
French ambassador to Zimbabwe Laurent Delahousse said the companies would produce equipment and service for the mining and agricultural sectors. “Once again three French companies are starting operations in Zimbabwe, this is a message of confidence and capacity of Zimbabwe to attract international partners beyond hardships of the current economic situation,” Delahousse said.
