by Donald Nyarota
MUTARE- Repeal of the controversial Indigenization
and Economic Empowerment Act left communities from resource-rich areas with
limited legal legroom to benefit from mineral resource revenue.
this background, a coalition of civil society organization is pushing for a new
legislative framework to ensure communities benefit from natural resources’
What You Pay (PWYP), an international coalition of over 1000 organizations,
with a local chapter in Zimbabwe, is angling for an Act of Parliament.
its controversial enactment in 2010, the Indigenization Act set up a legal
framework for communities in resource-rich areas to benefit through the establishment
of Community Share Ownership Trust Schemes (CSOTs).
vilified for its role in allowing political cronies to take over companies,
with its infamous 59 per cent threshold, by setting up CSOT structures it gave
communities a legal footing to claim revenue from natural resources.
2019 Midterm budget review statement and supplementary budget by Minister of
Finance and Economic Development Professor Mthuli Ncube, however, confirmed an
end of the Indigenization Framework.
this, PWYP coordinator Joyce Machiri says mining communities still have a
constitutional right to benefit from the extraction of mineral resources in
during a virtual meeting launching a benefit-sharing campaign for communities,
Machiri said there was the need for a proper law to ensure communities get a
share from the extraction of natural resources.
no longer have legal backing, because government reversed the IEE Framework. A
proposal was made in the 2019 mid-term budget review that a new empowerment
framework will be formulated after the IEE framework was reversed.
to date there is no new policy framework that the government has come up with.
There is need for the Ministry of Finance and Economic Development to speed up
formulation of the new policy framework,” said Machiri.
CSOT structures body faced challenges in participation, transparency and
accountability due to accusations of hijacking by politicians, they were
legally constituted unlike the benevolence of corporate social responsibility.
Social Responsibility shortfalls
construction of a health centre for any community represents development. But
not for Mutoko community where granite miners have been constructing a clinic
for 14 years, according to community members.
the ordeal of Mutoko granite mining, Kuda Makanda a community monitor says
political elites are subjecting miners to underground tax, through favors and
gifts, under pretext of community development.
said there is no sincerity in cascading benefits to communities as miners’
interests are protected by compromised politicians when communities seek
redress and accountability.
granite miners here are not sincere, they have been building a clinic for over
14 years now through CSR, so we believe this framework cannot ensure
sustainable communities benefits.
have poor infrastructure, roads are in a sorry state, service delivery from
council is depressed they are failing to repair and maintain the current dilapidated
infrastructure as the revenue from granite mining is taken to central
treasury,” said Makanda.
the lack of an enabling legislative framework remains an albatross to revenue
sharing, communities are hopeful that through devolution they will get a chance
to participate in the mining value chain.
implementation is still lagging, government seemingly concentrates on effecting
favourable elements for hegemony, without legislating an Act of Parliament to
operationalize this constitutional principle.
says or residents in resource-rich communities, devolution presents a window of
opportunity to get involved and communities need to keep guard of its
devolution, there is a possibility that communities might start to actually
have some sort of involvement in how their resources are governed. But still,
the question goes back to the issue of an enabling framework.
is there in theory but in practice, it has not been realised on the ground,” he
authority officials concur with the community on the connivance of miners and
political elites receive money to shield companies from liability.
at Mutoko Rural District Council say they are receipting as little as a dollar
(local currency) from a tonne of black granite as royalty, while the more
granite mined the less royalty council receives.
Mashango Mutoko RDC, Finance Director, currently doubling as acting Chief
Executive Officer, questions production figures declared by miners as their
operations are out of council’s reach.
proposes direct benefits through reserving community concessions, setting up
local polishing firms to create employment, as the current laws allow miners to
essentially siphon granite for free.
paper, transparency is there but on the ground, it is a different story, we are
appealing for community reserved concessions. We need laws that ensure the
community benefits from granite mining in Mutoko.
are totally blind to the productions of the council, we don’t know the
production quantities from their mining activities. We are not sure even of the
tonnage because they use estimates,” he said.
fail to glitter
Rural District Council, chief executive officer Shepherd Chinaka says their
experience with diamonds of elite resource capture with no tangible local
community benefits draws parallels with Mutoko.
said council and communities shouldered inconveniences of mining expecting
benefits which have come in bits and pieces.
were expecting to benefit as the council as well as communities when diamond
mining started in our district but those benefits have not been tangible,” he
2012 then President Robert Mugabe was sold a US$50 million dummy at the launch
of Zimunya Community Share Ownership Trust by five diamond companies which
pledged ten million each but failed to honor their pledges contributing a mere
successor of the multi-company regime in Chiadzwa, the Zimbabwe Consolidated
Diamond Company (ZCDC) chipped in with $5 million in 2018, converted at 1:1
rate- leading to a rapid loss in value as the local currency plummeted against
the US dollar.
says when ZCDC has contributed it has been erratic, recalling only one year
since diamond mining started when royalty revenue was paid on time.
said benefits have not cascaded to local communities nor council which only
gets royalties at the end of the year, in devalued local currency.
the past two years, we have not been getting these levies in time. ZCDC has
contributed in phases, the ZWL$5 million which it seeded in the Zimunya CSOT at
a rate one to one was wiped when the financial laws changed.
wish government comes up with a legislation which forces miners to declare what
they have mined and council are given a percentage which is predetermined and
which can be fused into our annual plans,” said Chinaka.
PWYP study on Revenue transparency and sharing in the mining sector between the
period 2013 and 2019, proffered key recommendations towards improving natural
resource governance for sustainable development.
study recommended government to ensure transparency and accountability in
revenue management, sustainable planning for future generations and adoption of
mining sector reforms like the Extractive Transparency Initiative (EITI).
also said communities and CSOs can also push for revenue transparency by
following the money from central to provincial or lower government tiers in
line with Section 301 (3) of the Constitution, to advocate for accountability.
must push for a new framework to empower communities based on multi stakeholder
discussions, with a clear message for royalty revenue sharing framework and
preferential local procurement,” reads part of PWYP recommendations.
said the benefit-sharing campaign embraces transparency and accountability as
key facets of just, equitable and sustainable exploitation of natural
said a legislative benefit sharing and policy framework in Zimbabwe is key for
communities to get a fair share of the revenue from the extraction of finite
benefit-sharing campaign on transparency and accountability is critical at this
point in time we are running this to mainly inspire mining revenue transparency
and sharing in the extractive sector in Zimbabwe.
aim to lobby and advocate policymakers to review benefit-sharing laws and
policy frameworks in Zimbabwe,” said Machiri.