News / Africa

Platinum Giant Cedes Majority Stake in Zimbabwe

Zimbabwean President Robert Mugabe opens the country's Parliament in Harare, October 30, 2012.
Zimbabwean President Robert Mugabe opens the country's Parliament in Harare, October 30, 2012.
The world’s largest producer of platinum has bowed to pressure to cede 51 percent of its mining operations in Zimbabwe to local black concerns - under President’s Mugabe’s controversial indigenization policy. 

The Anglo American Platinum announcement comes as the company struggles with wildcat strikes in South Africa.  Zimbabwe, meanwhile, is stalled in getting financial support from the International Monetary Fund (IMF), due in part to concerns that the indigenization policy chases away much-needed foreign investment. 

Indigenization law

Anglo American became the second mining giant to comply with the indigenization law requiring all foreign-owned companies to transfer a majority stake of their Zimbabwe operations to local blacks.  The law is aimed at what the government says is addressing racial inequalities lingering from white colonial rule.

Anglo American Platinum executive in Zimbabwe, July Ndlovu, says he hopes surrendering the company's majority stake will benefit Zimbabweans.

"It has not been easy.  We have argued a lot, but we engaged in this process with only one single purpose in mind: which was to find a transaction which is value credited and beneficial to all parties and can ensure a sustainable mining investment in this country," said Ndlovu.

The deal calls for a 51 percent transfer of Anglo’s Unki mine - worth more than $140 million - to a state fund, mine employees, a community trust and unnamed local investors.

Earlier this year, Impala Platinum became the first mining concern to transfer 51 percent of its Zimbabwe operation Zimplats to local black interests under the same law.

Disincentive to investors

Zimbabwe has some of the world's largest known platinum deposits and the transfers are seen by President Robert Mugabe’s ZANU-PF party as a financial windfall in the cash strapped country.

But coalition partner Prime Minister Morgan Tsvangirai, his MDC party and many economists disagree - saying the indigenization policy is a disincentive for continued and new foreign investment.

It also appears to be a major obstacle in getting IMF and World Bank loans.  The IMF did relax restrictions on technical assistance to Zimbabwe earlier this week - but that does not translate into funding, says analyst John Robertson from Robertson Economic Information Services.

"The government has been crying for money and this is not money.  This is advice.  If we follow the advice we may qualify for financial assistance," he said.

But Zimbabwe's Empowerment and Indigenization Minister Saviour Kasukuwere argues indigenization is actually creating a sustainable mining investment in Zimbabwe - and those that see it any other way need not invest in the African country. 

“This policy has been extensively debated.  If major, those major, investors can accept that this policy gives them a fair return, to then say [it] scares away investors - if there are investors who do not want - must stay in their own countries," said Kasukuwere.

It remains to be seen if Anglo American will reap a fair return in Zimbabwe after giving up its majority stake and it is not clear if the move is related to its recent troubles in South Africa.

The platinum giant has been facing illegal strikes since mid-September in spiraling labor actions across much of the mining sector.   Some 12,000 platinum miners have yet to return to work at mines outside of Johannesburg.  The company says production is down by 3,694 ounces of platinum - or $5.7 million - per day. So far losses have amounted to nearly a quarter of a billion dollars in about six weeks.

You May Like

Turbulent Transition Imperils Tunisia’s Arab Spring Gains

Critics say new anti-terrorism laws worsen Tunisia's situation while others put faith in country’s vibrant civil organizations, women’s movement More

Burundi’s Political Crisis May Become Humanitarian One

United Nations aid agencies issue warning as deadly violence sends tens of thousands fleeing More

Yemenis Adjust to Life Under Houthi Rule

Locals want warring parties to strike deal to stop bloodletting before deciding how country is governed More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Texas Town Residents Told to 'Just Leave' Ahead of Flood Threati
X
Greg Flakus
May 29, 2015 11:24 PM
Water from heavy rain in eastern and central Texas is now swelling rivers that flow into the Gulf of Mexico, threatening towns along their banks. VOA’s Greg Flakus visited the town of Wharton, southwest of Houston, where the Colorado River is close to cresting.
Video

Video Texas Town Residents Told to 'Just Leave' Ahead of Flood Threat

Water from heavy rain in eastern and central Texas is now swelling rivers that flow into the Gulf of Mexico, threatening towns along their banks. VOA’s Greg Flakus visited the town of Wharton, southwest of Houston, where the Colorado River is close to cresting.
Video

Video New York's One World Trade Center Observatory Opens to Public

From New Jersey to Long Island, from Northern suburbs to the Atlantic Ocean, with all of New York City in-between.  That view became available to the public Friday as the One World Trade Center Observatory opened in New York -- atop the replacement for the buildings destroyed in the September 11, 2001, attacks.  VOA’s Bernard Shusman reports.
Video

Video Seoul Sponsors Korean Unification Fair

With inter-Korean relations deteriorating over the North’s nuclear program, past military provocations and human rights abuses, many Koreans still hold out hope for eventual peaceful re-unification. VOA’s Brian Padden visited a “unification fair” held this week in Seoul, where border communities promoted the benefits of increased cooperation.
Video

Video Purple Door Coffeeshop: Changing Lives One Cup at a Time

For a quarter of his life, Kevin Persons lived on the street. Today, he is working behind the counter of an espresso bar, serving coffee and working to transition off the streets and into a home. Paul Vargas reports for VOA.
Video

Video Modular Robot Getting Closer to Reality

A robot being developed at Carnegie Mellon University has evolved into a multi-legged modular mechanical snake, able to move over rugged surfaces and explore the surroundings. Scientists say such machines could someday help in search and rescue operations. VOA’s George Putic reports.
Video

Video Shanghai Hosts Big Consumer Electronics Show

Electronic gadgets are a huge success in China, judging by the first Asian Consumer Electronics Show, held this week in Shanghai. Over the course of two days, more than 20,000 visitors watched, tested and played with useful and some less-useful electronic devices exhibited by about 200 manufacturers. VOA’s George Putic has more.
Video

Video Forced to Return Home, Afghan Refugees Face Increased Hardship

Undocumented refugees returning to Afghanistan from Pakistan have no jobs, no support system, and no home return to, and international aid agencies say they and the government are overwhelmed and under-resourced. Ayesha Tanzeem has more from Kabul.
Video

Video Britain Makes Controversial Move to Crack Down on Extremism

Britain is moving to tighten controls on extremist rhetoric, even when it does not incite violence or hatred -- a move that some are concerned might unduly restrict basic freedoms. It is an issue many countries are grappling with as extremist groups gain power in the Middle East, fueled in part by donations and fighters from the West. VOA’s Al Pessin reports from London.
Video

Video 3D Printer Makes Replica of Iconic Sports Car

Cars with parts made by 3D printers are already on the road, but engineers are still learning about this new technology. While testing the possibility of printing an entire car, researchers at the U.S. Department of Energy recently created an electric-powered replica of an iconic sports roadster. VOA’s George Putic has more.
Video

Video Al-Shabab Recruitment Drive Still on In Kenya

The al-Shabab militants that have long battled for control of Somalia also have recruited thousands of young people in Kenya, leaving many families disconsolate. Mohammed Yusuf recently visited the Kenyan town of Isiolo, and met with relatives of those recruited, as well as a many who have helped with the recruiting.
Video

Video A Small Oasis on Kabul's Outskirts Provides Relief From Security Tensions

When people in Kabul want to get away from the city and relax, many choose Qargha Lake, a small resort on the outskirts of Kabul. Ayesha Tanzeem visited and talked with people about the precious oasis.
Video

Video Kenyans Lament Losing Sons to al-Shabab

There is agony, fear and lost hope in the Kenyan town of Isiolo, a key target of a new al-Shabab recruitment drive. VOA's Mohammed Yusuf visits Isiolo to speak with families and at least one man who says he was a recruiter.
Video

Video Scientists Say Plankton More Important Than Previously Thought

Tiny ocean creatures called plankton are mostly thought of as food for whales and other large marine animals, but a four-year global study discovered, among other things, that plankton are a major source of oxygen on our planet. VOA’s George Putic reports.
Video

Video Kenya’s Capital Sees Rise in Shisha Parlors

In Kenya, the smoking of shisha, a type of flavored tobacco, is the latest craze. Patrons are flocking to shisha parlors to smoke and socialize. But the practice can be addictive and harmful, though many dabblers may not realize the dangers, according to a new review. Lenny Ruvaga has more on the story for VOA from Nairobi, Kenya.

VOA Blogs