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EconomyFuture of MiningSouthern Africa

Zimbabwe can narrow it’s debt: Experts

Zimbabwe can significantly narrow its debt if the country manages its vast natural resources in a more sustainable manner, experts have said.

The country is saddled with an unsustainable debt, which has negative effects on the economy and citizens.

This has now been worsened by the obtaining Covid-19 pandemic, which has affected economies across the globe and is expected to cause further damages to an already constrained economy battling with foreign currency shortages, poor utilities supplies and waning disposable incomes due to high inflation.

In a study titled Domestic Resource Mobilisation and the Quest for Sustainable Alternative, Dr Gorden Moyo, a lecturer at the Lupane State University and former State Enterprise Minister, highlighted the need for urgent strategy for resource mobilisation for the country to deal with its fiscal deficits and debt burden.

He said the country has been in a “debilitating debt trap” for decades now, despite being endowed with vast natural resources that can be harnessed towards its growth and turnaround.

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“A cursory analysis of the natural capital in Zimbabwe including its mineral resources stocks, wildlife, forestry, fisheries and arable land among others suggest that the country’s resources are enough to finance its own development if the mindsets, conditions, institutional and legal frameworks are put in place,” he said.

According to the study, Zimbabwe is endowed with 13 million tonnes of gold, 2.8 billion tonnes of platinum, 26 billion tonnes of coal, 10 billion tonnes of chrome and 4.5 million tonnes of nickel.

The country also holds 16.5 million carats of diamonds, 30 billion tonnes of iron ore, 5.2 million tonnes of copper and 765 billion cubic metres of coal bed methane.

Dr Moyo said, with this natural wealth, the country could harness it for development without overly “relying on erratic external flows”.

This, he added, could only be achieved with political will, while also taking a leaf from regional peers such as Botswana and Angola that embraced sustainable domestic resource mobilisation for their development.

The study was released yesterday at an online platform hosted by the Zimbabwe Coalition on Debt and Development (ZIMCODD).

It also recommended Government to fully implement the principles and values of the African Mining Vision (AMV) which include maximising and management of tax revenues in the mining sector. Apart from allowing countries to fully benefit from their natural resources, the AMV also emphasises on transparency on transactions between mining companies and governments.

The country is also working on an ambitious US$12 billion revenue mining sector by 2023.

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