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

Video British Fighters on Frontline of Islamic State Information War

It’s estimated that several hundred British citizens are fighting for Islamic State alongside other foreign jihadists More

Pakistan's Political Turmoil Again Shines Spotlight on Military

Thousands of protesters calling for PM Sharif to step down continue protests in front of parliament, as critics fear political impasse could spur another military coup More

Photogallery Ebola Quarantines Spark Anxiety in Liberian Capital

Food prices rise sharply as residents attempting purchases clash with security forces, leaving one person dead More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Native Bees May Help Save Cropsi
X
Deborah Block
August 22, 2014 12:23 AM
U.S. President Barack Obama has called for a federal strategy to promote the health of bees that have been declining. The honeybee has been waning due to parasites, disease and pesticides. Wild bees may be used to take over their role as crop pollinators. Scientists first need to learn a lot more about wild bees, says biologist Sam Droege, who is pioneering the first national inventory on native bees. VOA’s Deborah Block went to his research laboratory in Beltsville, Maryland, to bring you more.
Video

Video Native Bees May Help Save Crops

U.S. President Barack Obama has called for a federal strategy to promote the health of bees that have been declining. The honeybee has been waning due to parasites, disease and pesticides. Wild bees may be used to take over their role as crop pollinators. Scientists first need to learn a lot more about wild bees, says biologist Sam Droege, who is pioneering the first national inventory on native bees. VOA’s Deborah Block went to his research laboratory in Beltsville, Maryland, to bring you more.
Video

Video US Defense Officials Plan for Long-Term Strategy to Contain Islamic State

U.S. defense officials say American air strikes in Iraq have helped deter Islamic State militants for the time being, but that a broad international effort is needed to defeat the extremists permanently. Defense Secretary Chuck Hagel warned Thursday that the group formerly known as the Islamic State in Iraq and the Levant, or ISIL, is better organized, and financially and militarily stronger than any other known terrorist group. Zlatica Hoke has more.
Video

Video Drug-Resistant Malaria Spreads in Southeast Asia

On Thailand’s border with Myanmar, also known as Burma, a malaria research and treatment clinic is stepping up efforts to eliminate a drug-resistant form of the parasite - before it spreads abroad. Steve Sandford reports from Mae Sot, Thailand.
Video

Video Gaza Conflict, Hamas Popularity Challenge Abbas

The Palestinian unity government of Mahmoud Abbas has failed to convince Hamas to agree to Egyptian-negotiated terms with Israel on a Gaza cease-fire. VOA State Department Correspondent Scott Stearns reports on what the Gaza conflict means for President Abbas, with whom U.S. officials have worked for years on a two-state solution to the Israeli-Palestinian conflict.
Video

Video Nigeria's 'Nollywood' Movie Industry Rolls in High Gear

Twenty years after its birth in a video shop in Lagos, Nigeria's "Nollywood" is one of the most prolific film industries on earth. Despite low budgets and whirlwind production schedules, Nigerian films are wildly popular in Africa and industry professionals say they hope, in the future, their films will be as great in quality as they are in quantity. Heather Murdock has more for VOA from Lagos.
Video

Video UN Launches 'Biggest Aid Operation in 30 Years' in Iraq

The United Nations has launched what it describes as one of the biggest aid operations in 30 years in northern Iraq, as hundreds of thousands of refugees flee the extremist Sunni militant group calling itself the Islamic State. As Kurdish and Iraqi forces battle the Sunni insurgents, the fighting has forced more people to flee their homes. Kurdish authorities say the international community must act now to avert a humanitarian catastrophe. Henry Ridgwell reports for VOA from London.
Video

Video Cambodian American Hip Hop Artist Sings of Personal Struggles

A growing underground movement of Cambodian American hip hop artists is rapping about the struggles of living in urban America. Most, if not all of them, are refugees or children of refugees who came to the United States from Cambodia to escape the Khmer Rouge genocide of the 1970s. Through their music, the artists hope to give voice to immigrants who have been struggling quietly for years. Elizabeth Lee reports from Long Beach, California.
Video

Video African Media Tries to Educate Public About Ebola

While the Ebola epidemic continues to claim lives in West Africa, information technology specialists, together with radio and TV reporters, are battling misinformation and prejudice about the disease - using social media to educate the public about the deadly virus. VOA’s George Putic has more.

AppleAndroid