Impacts of Mining to Host Communities

A Report on a Monitoring Visit to Mhondongori, Zvishavane

1.1 Introduction and Background

In early 2016, the Zimbabwe Environmental Law Association commissioned a research into the social, economic and environmental impacts of mining to rural communities that host mining investment in Zimbabwe. One of the driving factor for the research was seen as the high levels of unmonitored chrome mining activities in Zvishavane. Some of the recommendations from the ZELA/OXFAM research directly related to the promotion of Social Licensing, promoting community consent and decentralisation of key reporting institutions.

In February 2018, the Zimbabwe Environmental Law Association (ZELA) in partnership with Norwegian Peoples Aid (NPA) commissioned a separate, independent monitoring visit to Zvishavane, in Mhondongori village. The primary purpose of the visit was to follow up on community members’ activities and reflections that were being put in action after the members had visited other mining areas in South Africa and Mozambique, and learnt various lessons. Further, the monitoring visit would aim at creating a platform where communities discuss emerging issues from chrome mining and also freely share with the Environmental Management Authority and Runde Rural District Council representatives on these issues.

1.2 The Good

Chrome mining is an important economic activity in Zimbabwe. Indeed, Zimbabwe is the seventh largest producer of Chrome in the world[1]. In 2017 the country earned $293 million and $84,4 million from high carbon ferrochrome and chrome ore respectively[2]. Further, in 2018 the Government projects an output of 1,7 Million tonnes from Chrome, which is a significant 80 percent increase from 2017[3].

Chrome mining has been seen as critical tool in community empowerment and economic development. One way adopted by government to achieve this is to acquire large tracts of land from mining companies and redistribute it to small scale miners in the community through a tributary mining system. For instance, in 2016 the Government announced that ZIMASCO had ceded 22 000 hectares of land containing massive chrome rich deposits while a further 20 000 hectares were ceded by ZimAlloys to small scale miners[4]. This model has empowered local citizens and communities by giving them access to resources occurring in their areas, thus benefitting from their natural resources.

1.3 The Ugly

Despite good governmental intentions in relation to community empowerment through tributary mining, the local communities continue to pay too high a cost out of mining activities. One affected community member pointed this out:

“We are facing harassment from chrome miners in our village. Some of the miners come from outside Mhondongori. They(Chrome Miners) are stealing our livestock when not paid properly by their employers. We have also recorded several cases were local communities are attacked coming from shopping and the victims are dumped in open pits (left from chrome mining) for dead. We are losing grazing land for our livestock through veld-fires as the miners are resorting to poaching wild animals.”

The community members further highlighted cases of sexual abuse of minor girls as young as 12 years from the miners. The mining operations are also leaving open pits as there are no proper rehabilitation plan in place. One villager, a member of the Mhondongori Development Trust stated:

“Last week we stopped the large mining trucks from passing through our community. We detained the truck for three days demanding the mine owners to engage us and hear our grievances. The Police intervened and we released the trucks”.

The trust mobilised other community members to stand against the miners, and this canbe regarded as an innovative way of compelling dialogue and engagement. An EMA officer confirmed community claims, highlighting that:

“The tributary miners are leaving open pits. It is difficult for us to hold these miners accountable. We cannot demand for their Environmental Impact Assessment (EIA) as ownership of their claims is not recognised by Ministry of Mines.”

Yet another official, the Environment Officer of Runde Rural District Council complained:

“Our worry as council is on sanitation. There are no toilets in the proximity of the mining activities”.

 

1.4 Way forward

Women from Mhondongori have gone a step forward in creating women Forums to fight against the negative impacts of chrome mining in their community. The forums give them a collective and louder voice to stand against the abuses of the tributary system and other wrongs of mining in the area. In the context of the discussions and the lessons that communities learnt from their regional experiences the following recommendations were made:

  • The Government should ensure that the tributaries are registered under the Ministry of Mines before such tributaries can commence operations.
  • EMA should make demands on number of open pits to be rehabilitated as opposed to having miners submit their rehabilitation plan.
  • Communities should be consulted on miners who will be mining in the area to create room for accountability.
  • Runde RDC in partnership with EMA must ensure close monitoring on all land degradation activities.
  • The Mhondongori community has to identify opportunities presented by the mining operations such as the currently running fishery project, where the Mhondongori Development Trust converted open mining pits to fish ponds.
  • ZELA should continually support and educate the women forums with legal skills so that they are conscious of their rights, available remedies, legal strategies and approaches to problem solving.

[1] https://www.indexmundi.com/minerals/?product=chromite&graph=production

[2] http://ebusinessweekly.co.zw/zim-mineral-exports-surpass-target/

[3] http://www.czi.co.zw/images/presentations/outlook7.pdf

[4] https://www.herald.co.zw/binding-title-will-be-welcome-chrome-miners/

Water Conservation in the Mining Industry: Lessons for Zimbabwe

Water Conservation in the Mining Industry: Lessons for Zimbabwe

In Zimbabwe, the mining industry is at the heart of the socio-economic transformation agenda. However, mining-led growth without proper environmental management is not sustainable. This article focuses on water management developments in North America’s mining sector to raise public awareness on water management in Zimbabwe.

Mining has been a major industry in North America since the 19th century, although it has been present in one form or another from 1522 onward. Throughout that time, mining in the United States has exhibited a pattern of “rushes” as new minerals are discovered, with the most dramatic rushes happening at the discovery of gold deposits in the western half of the country.

The negative environmental impact of mining is widely accepted. Its aftereffects can include erosion, the formation of sinkholes, biodiversity loss, contaminated water and soil, and threats to human health.

Fortunately, the 21st century has seen an increased focus on sustainable mining practices in North America. In recent years, government regulation and cleaner production technology have worked in concert to reduce the environmental effects of mining, while still appeasing both business and governmental interests. It is important to note, however, that there is still a great deal of work to be done, and this is only a first step.

Water

Water is required at every stage of the mining process, and mining can result in water shortages when water is consumed, as well as the groundwater through acid rock drainage and heavy metal pollution (metals such as lead and cadmium in the mine dissolving into drinking water, making it undrinkable for humans). When water is diverted at mining sites, it can result in habitat loss for aquatic species, as well as water shortages for human and other industrial needs, especially in drier regions of North America.

In response to these issues, two mining companies in northern Canada have taken steps to put pollution controls in place. The two companies began a partnership with an independent environmental monitoring agency, CanNorth, that in regular water testing with the help of members of the community. In the last 20 years pollution from the mines has decreased, and the community and mining companies enjoy a mutually beneficial working relationship. (1)

Beyond this case study and across the country Canada leads the way in innovative water conservation practices. The mining industry accounts for the largest industrial use of water in that country. through Between 1996 and 2005, however, Canada reduced its water use in mining by 33%, at the same time as the value of production increased, leading to an overall decline in water intake per dollar of production. (2)

One of the most oft-cited recommendations for the reduction of water use is recycling and reusing water. Researchers from Columbia University’s Center on Sustainable Development in New York recommend that companies only consider disposal of water as a last resort, and promote waste water minimization through the below hierarchy. (3)
1. Avoidance
2. Reduction
3. Reuse
4. Recycling
5. Recovery of energy
6. Treatment
7. Containment
8. Disposal

Here in Zimbabwe, Zimplats is already engaged in water recycling, to the effect that they needed to abstract 9% less water in 2017 than 2016 from dams and underground. (For more information see Zimplats’ Annual Report, linked in “Other resources.”)

Case Study: mine in California, United States (4)

Old method: New method:
Huge amounts of freshwater pumped in. water used and up to 850 gallons of waste water produced per minute, had to be pumped miles away to evaporation ponds. Almost all initial freshwater brought in can be recycled. More than 120 acres of evaporation ponds can be eliminated and freshwater consumption reduced by 90%.

Conclusion: the need for government leadership
National governments can and should take leadership on water conservation in mining. Government regulation sets the stage for cleaner mining practice by mining companies. In recent decades, most countries have adopted environmental legislation prescribing limits on human impact on water.

The United States, for example, has implemented the following regulations. (5)
• Ground Water Rule: protects water against microbial pathogens in public water sources.
• Underground Injection Control Program: regulates wells that place liquids underground where they could pollute groundwater.
• Source Water Protection: ensures the quality of drinking water.

It is generally recognized that preventing contamination is more efficient and economically viable than reversing those effects later. With this in mind, government regulation leading to changes at the mining company is the most important thing that can be done to ensure clean, healthy water supplies for both human consumption and as a part of a healthy natural ecosystem.

Other resources
Zimplats Annual Report for Fiscal Year 2017: https://www.zimplats.com/data/2017/10/AR2017.pdf
The International Council on Mining and Minerals: https://w ww.icmm.com/en-gb
Image Sources
Image 1: 3 Paulina Szyplinska “CEO 360 Degree Perspective of the Global Mining Water and Wastewater Treatment Market,” Frost & Sullivan (May 11, 2012).
Image 2: Kauppila, Päivi & Räisänen, Marja & Myllyoja, S. (2011). Best environmental practices in metal ore mining. Finnish Environment. 29. 1-219.

ZAMI’s ASM National Action Plan

During the 7th of the Zimbabwe Alternative Mining Indaba (ZAMI), Pact and the Zimbabwe Environment Law Association (ZELA) organised a breakaway session on Artisanal and Small-Scale Mining on 11 October 2018, at Holiday Inn, Bulawayo. The ZAMI was held under the theme “Accountable and Transparent Governance of Mineral Resources: Safeguarding Development Interest of Local Communities in Mining Sector Reforms.” Participants comprised of artisanal and small-scale miners (ASMers) from key gold producing districts in Zimbabwe, the Reserve Bank of Zimbabwe, Women Empowerment Bank and Zimbabwe School of Mines, the Zimbabwe Mining Federation (ZMF) executive and a group of researchers on resource nationalism from Tanzania, Zambia, Zimbabwe and Canada under York University, Canada. Below is an action plan that emanated from the ASM dialogue;

  • To promote grassroots participation in mineral resource governance reforms, the Mines and Minerals Amendment Bill, The Gold Trade Act and Precious Stones Act, as highlighted by the State of the Nation Address (SONA)’s legislative agenda for the 9th Parliament. Key asks of AMSers and communities must be documented for each mining district and consolidated at national level for presentation to Parliament. The laws should decriminalise artisanal mining.

 

  • To ensure that ASM because the centrepiece of government agenda on resource nationalism to ensure the communities are not dislocated from carrying out mining activities. This is in line with Section 13 (4) of national development which compels the State to put in place mechanism to ensure communities benefit from resources in their localities.

 

  • The Finance Act of 2018 which reserved artisanal mining for indigenous players must have a definition on what constitute artisanal mining. The reform of the principal legislation governing the mining sector, the Mines and Minerals Act must embrace artisanal mining to support the Finance Act’s position.

 

  • ASM should be opened in all mineral sectors. Government must open space for ASM in Marange diamond fields to ensure equitable exploitation of the diamonds.

 

  • The gold development loan facility should include empowerment objectives to enable financial support to poor and marginalised ASMers. It is commendable that RBZ has set aside $20 million for women and the relaxation of collateral requires. However, it is disturbing to note that only 255 entities or individuals benefited from $74 million disbursed in 2017 according to the 2018 Monetary Policy Statement (MPS). This translate to an average loan size of $290,000 per individual. An amount which is 10 times more than the average loan size require for basic mechanisation and input support of many ASMers. Therefore, RBZ must allocate a significant portion of the gold development facility to boost productivity of poor ASMers.

 

  • Fiscal support on exploration should be given to ASMers to ensure that their mining business activities are weaned from gambling. Also, this augurs well for the country’s quest to earn more foreign currency from ASM sector. With exploration, the geological risks associated with ASM will be lowered to unleash opportunities for increased investment into the sector.

 

  • There is need to unpack what the 100 tonnes of annual gold production by 2023 mean in terms of sustainable and integrated rural economic development as envisioned by Africa Mining Vision. Currently, there seems to be a huge disconnect between buoyant gold production in the ASM sector well-being of key gold producing communities.

 

  • RBZ fund should be used to maximise backward linkages in the ASM sector, local production of machinery, goods and services to improve the development dividend from the sector.

 

  • The Zimbabwe Miners Federation should be made a statutory body and get fiscal support to facilitate mobilisation and organisation of ASMers to engage better with policy makers and other key stakeholders for responsible and profitable growth of the ASM sector.

 

  • ASMers should document and tell their own stories to counter negative publicity fuelling public perception the sector should be outlawed.

 

  • A case study is needed to understand how big the threat is posed by Chinese investors in the ASM sector.

 

  • Legal aid should be offered in the ASM sector to bring civil suits to perpetrators of violence – machete wielding gangs. Suing them for medical bills, loss of income and pain will help to curb the violence which has gotten out of hand.

Exploring Linkages and Collaboration Between Workers in Formal Mining Companies and Artisanal Mining Workers

This write up is inspired by the presentation I made during a one-day workshop on “Promoting Decent Work in the Mining Sector.” Held at Jameson Hotel, Harare on 25 September 2018, the workshop was organised by Labour Economic Development Research Institute of Zimbabwe (LEDRIZ) together with Zimbabwe Congress of Trade Union (ZCTU) and Friedrich Ebert Stiftung. Key linkages explored include technical skills, investment, organising and bargaining skills and corporate social investments.

Leverage on your technical skills

Employees of large scale mining (LSM) companies have the technical skills and experience to carry out safe, responsible and efficient mining activities. Some of the critical technical skills needed to successfully run a mining business include geology, metallurgy, mining engineering and Safety health and Environment management.  Artisanal and small-scale (ASM) mining is business, the dearth of critical skills in the sector is a major impediment. This challenge can be flipped into exciting opportunities for partnerships or joint ventures between artisanal and small scale miners (ASMers) and formal labour in the mining sector. In the case of retrenchment, mining employees but not see this as an end of the road, the skills they have can be usefully be absorbed into ASM. Over 500,000 people are directly involved in ASM compared to slightly less than 50,000 people directly employed by large scale miners.

 

Investment opportunities

A strong injection of capital is vital to boost productive of the ASM through acquisition of machinery, recruitment of specialised skills and development of safe mining shafts among others. Using individual savings from their salaries, labour from LSM companies can either pool their resources or individually invest in existing ASM operations. After all, they have the skills to do due diligence before they invest to ensure that they investments are safe. Aside from personal savings, labour from LSM operation have pension finds. Therefore, labour can negotiate with government to give prescribed asset status to investments into ASM operations by pension funds linked to LSM companies. This will enable development of artisanal miners into small scale, medium scale and large-scale mining operations.

Salaries and retrenchment packages in arrears

Sometimes opportunities are disguised as problems. It is often reported in the press that workers in the mining sector have not been paid for several months and retrenchments packages are paid in instalments. Instead, employees should leverage salaries and retrenchment packages in arrears to settle for tributes from large scale miners to venture into small scale mining. This is possible because some deposits are not economically viable for large scale mining. Venturing into small scale mining will help to create decent jobs for many artisanal miners daily exposed to an unsafe working environment.

Professional friends for ASMers

Labour associations in the mining sector can partner with Non-Governmental Organisations (NGOs) like the Zimbabwe Environmental Law Association (ZELA) to form a Trust for professional friends of ASMers. The trust will recruit on part time basis local and international experts who are keen to offer their services for free to promote safe, responsible and profitable ASM. Travel and subsistence allowances for field visits will be covered in full by the Trust. Through use of social media tools like WhatsApp, experts can troubleshoot challenges raised by ASMers in WhatsApp groups through small videos, voice notes or text messages.

Formal labour has the voice and ASMers have the numbers

Formal labour organisation has lost its stamina in terms of negotiating and bargaining with policy makers. They have the voice but the lack of numbers due to closure of several mining companies, the numbers cannot make a loud chorus for change which is hard to ignore. This challenge can be averted if formal labour organisations help ASMers to organise and make their numbers count during formulation and implementation of policies that affect them. For instance, the reform of the colonial Mines and Minerals Act and Gold Trade Act. Lega instruments which criminalise artisanal mining, an important source of employment and income generation for many Zimbabweans.

Corporate Social Investments

Formal labour in the mining sector in Zimbabwe has not suffered a Marikana incident. There is Maracanã and its effects are ugly to development. A devastating cholera scourge currently haunting Zimbabwe is a reminder of missed priorities. Harare city council invested in soccer whilst mountains have developed from uncollected garbage in residential areas. The trend of misplaced priorities is being witnessed in the mining sector on corporate social investments. Companies investing in football clubs. Formal labour should voice its concerns and urge mining companies to earmark part of their corporate social investment in ASM. In 2015, Mimosa mine donated equipment, compressors and jackhammers worth $150,000 to Zvishavane-Mberengwa small scale miners association.

Conclusion

Harnessing linkages between formal labour in LSM and ASMers is quite important to ensure a win-win situation. Formal labour has an opportunity to leverage their technical skills, investment muscle and organising and bargaining skills to influence responsible, safe and productive growth of ASM in Zimbabwe. Civil society organisations must facilitate continuous conversations between labour from LSM and ASMers to foster mutual beneficial partnerships.

Hope for Justice: African perspectives on the negotiations for a binding instrument on business and human rights

Myness, 38, is one of the Chiadzwa residents who were forced off their land

when diamonds were discovered in her area.

By: Nyaradzo Mutonhori

This article originally featured on ACTIONAID Website

In every corner of Africa, the stories are similar. Death, hunger and rising poverty levels are the devastating outcomes induced by corporations in host communities. Contrary to the healthy, prosperous and wealthy society narratives often promised these communities by corporations, exposure to toxic wastes, loss of livelihoods, restrictions on mobility and massive environmental degradation become their actual lived realities. Active non-compliance and violation of environmental regulations by corporations on the one hand, coupled with wilful denial of the existence of these human rights violations by states on the other, ensure poor communities and especially women continue to bear the burden of the environmental cost of business over long time periods.

One of the communities that I work with is the relocated community of Arda Transau in Zimbabwe. Between 2009 and 2011, diamond miners in Zimbabwe relocated more than 700 families from Marange to Arda Transau, 40km north of the diamond fields. Since then, the community has been ravaged by death due to water-borne diseases caused by a lack of access to clean water and poor health services; food insecurity due to pollution and siltation of rivers by diamond miners; deteriorating education standards due to rising population and overcrowding. 

Women have been the worst affected. They now travel longer distances to fetch clean water and spend more time caregiving for those who fall ill with typhoid and cholera. Other social impacts include increase in sextortion, sometimes referred to as ‘transactional sex’, as women negotiate with the military and private security agents to enter Marange diamond concession in search of wild fruits and firewood to sell. Less than a decade later, their houses have started cracking and are literally falling apart. Before being relocated, the diamond miners and government promised the families adequate housing, jobs, tap water, clinics, schools, electricity and irrigated fields. 

Across Africa, when affected communities speak up and fight for their rights through filing administrative and judicial complaints, their quests for justice becomes an injustice in itself because of long delays in this process. When they organise and build movements in the communities resisting mining, they are arrested and criminalised and labeled economic saboteurs. When they build campaigns on the media and try to get a voice, governments close the space by deploying state security agents to quash community movements. 

Women Human Rights Defenders face malignant sexual harassment and intimidation for seeking justice for violations caused by the activities of corporations. When women from the Arda Transau community staged demonstrations demanding clean water, they were threatened with arrests and labeled ‘prostitutes’. When Arda Transau community organised into a community based group mobilising for members and the women organised women’s forum movements, the government accused the community of joining political opposition movement and closed all doors of engagement with the community group.

When the Arda Transau community initially resisted relocation in 2009, the police descended upon the community and warned them not to stand in the way of development. Despite this indirect threat, the Arda Transau community filed a High Court application seeking enforcement of Constitutional provisions on fair and adequate compensation and the right to title for the houses they were relocated to. It has been two years now and it is still unclear when the matter will be heard and judgment passed.

This week I joined more than 200 other civil society representatives from around the world at the UN in Geneva, where I represented ActionAid’s Africa Extractives Working Group. We have spent the week listening and intervening as our state representatives carried a round of negotiations on how to regulate the human rights impacts of business activities in international lawAn international instrument on business and human rights could give the Arda Transau community the chance to access justice outside of Zimbabwe, in the ‘home’ country of the mining corporation.

The binding instrument negotiations provide hope for justice for many of us in Africa. We have hope that if such an instrument comes into force, we – us and future generations – will have a good chance at justice for rights violations by corporations

We have seen those who oppose the binding instrument say the current draft is ambitious and imprecise. We know that the binding instrument will not be the silver bullet to solve all problems and rights violations by corporations in Africa, but we believe this binding instrument will give women human rights defenders power to continue seeking justice against violations. We believe the binding instrument will introduce preventive measures to help shield women from devastating impacts of the business of corporations on their bodies. The binding instrument will place measures to enable women’s voices to be heard by governments and corporations.

The reading of the zero-draft of the binding instrument on business and human rights is among the first historic steps taken towards a treaty. As I go back to Zimbabwe, I am reenergised to keep fighting alongside mining affected communities, and I call on all women’s rights activists to stand with women affected by corporate abuse to keep pressure upon their states and ensure the process doesn’t stop here.

Auditor General’s Report: Accountability Issues for ZCDC

Conglomerate diamond mining at ZCDC’s. Picture taken by Nyaradzo Mutonhori

The quest to bring improved transparency and accountability in the management of Marange diamonds – scandalously known for “missing $15 billion” birthed the Zimbabwe Consolidated Diamond Company (ZCDC). As the Zimbabwe Environmental Law Association (ZELA), an organisation with solid interest in resource governance, we are compelled to sift the latest Auditor General’s report to have a better understanding of how well or bad is ZCDC managed for the benefit of all Zimbabweans.  After all, Chiri, the Auditor General is famed for digging out publicly data exposing the rot in the management of State Owned Enterprises (SOEs). Her reports were quite revealing on ZCDC’s predecessor in Marange, the Zimbabwe Mining Development Corporation (ZMDC). Apart from sifting through the evidence provided by the Auditor General, the scope of this article covers audit areas that must be improved to hold to fully hold ZCDC accountable.

Stale audited report

Audited reports are an important health check on the performance of an entity. Mismanagement of resources, like any disease early detection, even better prevention is quite critical to ensure operational sustainability. Here we are in 2018, discussing audit findings from ZCDC’s 2016 annual financial report. A clear one-year unproductive fallow period, 2017, shows that we are dealing with stale information. This a clear violation of the Public Financial Management (Act).  The Act requires SOEs and government institutions to produce annual audited financial statements within six months after the end of each financial year. ZCDC’s predecessor in Marange, Zimbabwe Mining Development Corporation (ZMDC) was notoriously known for producing outdated audited reports.

Apart from the Auditor General’s findings, there is no public record of ZCDC’s income statement and balance sheet. Citizens, therefore, have been denied the opportunity to know pertinent information like how much income did ZCDC generate in 2016. Considering that Zimbabwe is well behind on mineral revenue transparency best practice, the public does not have a clue how well ZCDC’s performance regarding taxes – royalties, customs duty, withholding taxes and Pay As You Earn (PAYE) among others. The same information can easily be publicly mined for Caledonia’s Blanket gold mine in Gwanda courtesy of Canada’s Extractive Sector Transparency Measures Act.

ZCDC is in financial distress

The Auditor General noted that ZCDC Made a loss of $7, 445, 606, negative working capital amounting to $7, 981, 756 and a total negative equity of $7,445, 576. Even worse, ZCDC is owed $20,307, 027 by related companies – SOEs that have closed. A figure that could not be verified by the Auditor General. The fact that ZCDC’s owed $20 million by related companies shows that the mismanagement of SOEs is contagious. There is a huge risk that ZCDC could have been used as a conduit to milk public funds through propping up companies that have since closed.

Mine rehabilitation fund problematic

The “missing $15 billion” from Marange diamonds has attracted great public attention, overshadowing environmental issues, rehabilitation and mine closure. The Auditor General failed to verify the $11,068,975, a provision for rehabilitation of mines left by the companies that used to mine diamonds in Marange. ZCDC’s response was that an expert will be hired to establish the budget needed to rehabilitate the mines and funding will be requested from the shareholder – government. As a regulate and player in Marange diamond mining operations, the state should lead by example. Unfortunately, ZCDC is painting a different picture.

Poor corporate governance cited

The Auditor General noted the Audit and Risk committee and Human Resource and Remuneration committees were not constituted properly in line with best practice on corporate governance. The CEO and executive audit officer are part of the Audit and Risk committee, and the CEO and the human resource executive are part of the Human Resource and Remuneration Committee. A development that compromises the fundamental oversight role of such committees as well as bringing reputational risks. The President has repeatedly stated the desire to fight corruption, the scourge stifling Zimbabwe’s growth. This war cannot be achieved without good corporate governance.

Illegal diamond mining activities

The Auditor General’s report is silent on the widely reported illegal diamond mining activities in Marange. Such activities are a loss to ZCDC and ultimately, government. As part of audit preparations, the Auditor is required to gain an understanding of the context under which the entity that he or she is planning to audit is operating under. Recently, ZCDC announced that it is planning to empower the community through artisanal mining to curb illegal mining activities and attendant losses through smuggling of diamonds.

Business and human rights and the threat posed by synthetic diamonds

The business case, especially in the diamond sector is growing beyond profitability. Because diamond industry is all about global value chain systems, from mining, cleaning and sorting, marketing of rough diamonds, cutting and polishing, jewellery production and marketing, consumer behaviour cannot be ignored. Increasingly, diamond consumers are demanding that beauty of diamonds should be preserved by ethically sourced diamonds which deliver sustainable development to communities impacted by mining operations. The audit scope must have been broadened to include management of risks posed by failure of government and corporates to protect and respect human rights, and in case of violations to provide access to remedy – United Nations Guiding Principles on Business and Human Rights. Notably, ZCDC has been ordered by the high court not to arbitrarily displace communities as required by the Section 74 of the Constitution. Pressure on ethical sourcing of diamonds has been piled up by the emergence of lab grown or synthetic diamonds which do not carry the burden of human rights violation linked to mining.

Legal risks and arrangements with companies displaced to pave way for ZCDC

ZCDC’s creation was blighted with legal challenges, companies like Mbada Diamonds, Anjin and Jinan taking to disputes to the courts. ZCDC failed to carry out mining activities in the disputed concessions. Consequently, ZCDC’s ability to optimise diamond production for the country’s benefit was affected. Along the way, it was announced that government is not negotiating with the affected companies to resolve the issue amicably.  Parliament oversight lacked during these negotiations as required by Section 315 (2) (c) of the Constitution. On 20 April, during the field visit by EU delegation, ZELA observed that the Chinese were fencing off claims formerly held by Anjin Investments. It was clear that ZCDC was not involved from the brief that we received from ZCDC’s top management. The Audit report must have ordinarily been alive to legal risks and the status of disputes between ZCDC and the companies that were forced to close to pave way for the new arrangement – this is a sustainability issue.

Conclusion

For an entity that was established to promote transparency and accountability in the management of Marange diamonds, the Auditor General’s report shows a false start for ZCDC. The entity’s audited report is lagging by one year, there is poor corporate governance, and a company that is in financial distress lending $20 million to related companies that are now closed. The Rehabilitation and mine closure fund issue is a timely reminder to government, we cannot talk of counting the benefits without fully accounting for costs of mining. In the diamond sector, value addition is not only about cutting and polishing, but embracing the UNGP on business and human rights. Consumers want diamonds that are ethically sourced, and diamonds which deliver sustainable development to communities. Areas that ZCDC and government are found wanting.

The Alternative Mining Indaba Movement Is Unstoppable

The Alternative Mining Indaba Movement Is Unstoppable

Mukasiri Sibanda with ZELA unpacking AMV to participants at Mutoko district AMI

As the Alternative Mining Indaba (AMI) revs up to celebrate its 10th anniversary in 2019, Mutoko district AMI stands out amongst several achievements of the movement. Mutoko AMI stands out in that it was initiated by Mutoko Rural District Council, a marked departure from the norm where civil society organisations (CSOs) drive the process.

The indaba was held at Nyamakwere hotel, Mutoko centre from 13 to 15 June 2018. Participants comprised of mining affected communities, Community Based Organisations (CBOs), Civil Society Organisations (CSOs) traditional chiefs, local government officials, Ministry of Mines, Zimbabwe Revenue Authority and Natural Stones- a mining company. Altogether, 95 people participated at the indaba, 22 women and 73 men. Here are five interesting things to note concerning the indaba.

Mutoko RDC was at the forefront of inviting stakeholders and crafting the agenda, through a participatory approach which involved CSOs. Hopefully, other resource rich RDCs will be inspired by Mutoko’s example to spread and strengthen the AMI movement in all corners of the country.

ZELA and Mutoko RDC are going to engage the Association of Rural District Councils of Zimbabwe (ARDCZ) to motivate other resource rich RDCs adopt or adapt the AMI movement. As a result, communities affected by mining will get a fair opportunity to strongly participate in the management of mineral resources in their localities.

Interest in Mutoko’s AMI is compounded by the fact that whilst Government is yet to hit top gear on implementation of the Africa Mining Vision (AMV), Mutoko community certainly view domestication of the AMV as a panacea to the resource curse.

“We will certainly adapt AMV as a guide to Mutoko RDC’s development plan hinged on the extraction of black granite resources” Peter Sigauke, Mutoko RDC CEO.

As if that is not enough, other CSOs have joined the bandwagon. CSOs like the Civic Forum on Human Development (CFHD) and Silveira House joined hands with Zimbabwe Environmental Law Association (ZELA) to support Mutoko’s AMI. Before this, ZELA, Zimbabwe Coalition On Debt and Development (ZIMCODD) and Zimbabwe Council of Churches (ZCC) were the only players driving AMI movement in Zimbabwe which begun in 2012.

Banana farmers saved from arbitrary eviction

WILLIE MAFUTA AND 26 OTHERS VERSUS PARKS AND WILDLIFE MANAGEMENT AUTHORITY: A CASE OF HUMAN RIGHTS, LAND RIGHTS, EQUITABLE RESOURCE MANAGEMENT AND DEVELOPMENT

INTRODUCTION

On the 7th of November 2018, the High Court of Zimbabwe made a ruling that the Vhimba people in Risitu, Chimanimani under Chief Ngorima in Chikware and Mapombere villages who had been issued with a 72 hours eviction notice should not be evicted from their homes as this would amount to unlawful and arbitrary evictions on the 27 families. A total of almost 300 people including children and women risked losing their livelihood in a blink of an eye.

Historically, the Vhimba people started losing their land in 1893 when the Pioneer Column reached what are now the Chimanimani and Chipinge Districts of Eastern Zimbabwe. Ever since then, it has been a struggle for Chief Ngorima’s people to retain their land. They lost their land from the colonial government in the 1890s, The Forest Commission in the 1950s, through the Chimanimani National Park in the 1960s and the creation of Botanical Gardens in the 1970s. The battle of retaining land by the Vhimba people continued into the post-colonial Zimbabwe and this was shown in the present case and now there seems to be a paradigm shift as rumours of gold discoveries in the area are becoming rampant.

FACTS LEADING TO THE CASE

The Vhimba community has occupied communal land with no title or ownership for over a century on record. The community is a banana farmer community who most of them were born in that industry having been born in banana farming families. They do not have any other source of income. From the year 1991, the community has had problems with Zimbabwe Parks and Wildlife Authority (Zim-Parks hereinafter referred to as the Respondent) whose Chimanimani Mountains National Park borders with their land. The community has lost most of its farming land to Zim-Parks following its unilateral alienation of land. In recent terms, in fact currently, the Respondent has been sending its officers to threaten the Vhimba community with eviction from their homesteads as it now claims to have the right to take over the land for its operations. One would be inclined to think that these are wildlife related operations. These however leave a lot to be desired as in Zimbabwe, communities living in wildlife areas have hardly been evicted in such a manner. Instead, a common ground to include them or to relocate them then include them in programmes like the famous CAMPFIRE have occurred in a number of districts around Zimbabwe. This strengthens the allegations of gold deposits being discovered in the area.

 On the 21st of October 2018, four (4) officers from Chimanimani Zim-Parks office gathered the Applicants and their families and advised them that they were giving them final notice to vacate the land and that they had to do so by the 25th of October 2018 failure which they were going to evict them using force. After expiry of the deadlines, the Respondent’s officers allegedly visited the villagers armed with AK47 assault rifles threatening the villagers that if they do not vacate the land they will be dealt with. This continued from the 25th until the last day of October. The Respondent’s officers even threatened to torch down the villagers’ homes and destroy their banana fields upon their return to evict them if they were to find them still in the area. Some of the villagers were even arrested and chained after being found in their fields after the deadline dates for eviction.

 

THE LEGAL ISSUES OF THE CASE

The Zimbabwean Constitution under Sec 74 guarantees freedom from arbitrary eviction. This freedom includes people’s freedom from eviction from their homes or have their homes demolished without an order of Court after the Court has made consideration of all the relevant circumstances of that matter. This was the main legal concern for the Vhimba case. Recently in The City of Harare versus Tawanda Mukungurutse SC 46/18 the Supreme Court of Zimbabwe reiterated this position. Also, at stake was the community’s right to human dignity as protected by section 51 of the Constitution. The Respondent had not first secured an Order of the Court authorising it to evict the Vhimba community from their land which it unilaterally claimed was its land. In the absence of such Court Order, any eviction would be enforced, unlawful and illegal eviction as the Court has not been given a chance to determine and consider all relevant circumstances of the matter to agree to a lawful eviction.

Lawyer Darlington Chidarara of ZELA reading & explaining to the Vhimba People their rights from the Constitution

ZELA’S INTEVENTION & THE SIGNIFICANCE OF THE CASE TO ZELA’s WORK

The Zimbabwe Environmental Law Association (ZELA) heard of the Vhimba community’s plight and decided to take heed of the call to assist the Vhimba marginalised community. As a public interest organisation, ZELA’s vision is to attain environmental justice through sustainable and equitable utilisation of natural resources and environmental protection. In the spirit of that vision, ZELA moved in swiftly to assess the situation. After realising that the dispute of land rights and a possibility of the extractive industries pushing for an unlawful eviction to pave way for mining, ZELA realised that in light of the new Constitution and their vision, the case was worth a take. As per ZELA’s vision, the people of Vhimba have an abundance of natural resources in the form of woodlands, animals which they were found co-existing with by the Pioneer Column in 1893 not forgetting the recent gold deposits alleged to be in their area. This started their troubles as they were placed in reserves and since then have not enjoyed much of their natural resources. ZELA firmly believes in equitable utilisation of natural resources whereby the local people benefit from their locally found resources. The Vhimba community exist in an environment which allows them a huge capacity to earn them money from eco-tourism, birding experiences and the national park activities such as game drives and even controlled trophy hunting experiences and recently being part of the extractive industry if the gold deposits alleged are in existence. However, this has not been the case ever since the arrival of the Pioneer Column a century ago up until October 2018 as all the Vhimba people know are land grabs, unfair and unilaterally decided forced evictions, resource grabs and threats and poverty yet existing in a naturally resource rich environment. Their major natural resources have been nothing but a curse for them. These misfortunes could be changed if the relevant authorities engage the people of Vhimba and try to work on a model that can benefit and include the community rather than depriving the community which is what ZELA strongly believe in.  

COURT’S ORDER & SIGNIFICANCE

The Court held that the Respondent was interdicted and prohibited from arbitrarily evicting the Vhimba community. This means that if the Respondent is to evict the people of Vhimba then they must follow set procedures as held in the Mukungurutse case stated above by getting a Court Order. This means that a new opportunity for engagement has been opened to realise equitable distribution of resources for the Vhimba community which could develop Vhimba as a community rather than destroying it and driving it into conflict as has happened previously. A community of almost 300 people was saved from arbitrary eviction and were given a lifeline. Thanks to ZELA.

 

 

 

 

Raising a generation of women with a difference @ mining.#AMI 2019

Raising a generation of women with a difference @ mining.#AMI 2019
9th Mar 2019 sophtak

After watching the documentary for ASMining case studies from Mozambique, South Africa, Zambia and Zimbabwe on the first day of Alternative Mining Indaba that was held from 04-06 February 2019 in Capetown. Many people were moved with the inclusion of women in artisanal and small scale mining they wanted to know more about ASM ,how it connects with women and young people.

I was one of the people who featured in the documentary as a young woman in small scale mining.From the questions that were directed to me i realised that there are people who are really interested in mining ,who want to venture and help women and youth in ASMining but they don’t have information. I write this story to inform,inspire,and encourage everyone interested in ASMining

SMALL SCALE MINING

A small scale miner in my country is a person who extract minerals legally, operating with a mine certificate and several mining licences. She /He works independently with the help of employees, mining various types of minerals using her/his own resources.Uses simplified forms of exploration and also extraction of the minerals.A developed small scale miner can have machines for extraction of minerals and processing plants at their mines.

A woman miner sharing her mining experience

Why women

I personally believe the key to freedom for women lies first in women becoming financially free.

I ventured into mining because It is a sustainable business.l started as an artisanal miner doing mining as a source of income,on seeing the benefits my passion for mining grow and with the help from my colleagues and family i registered and become a small scale miner.Mining business is not easy to start it needs exploration, working capital,machinery, proper project management and time,but there is space in ASMining where one can always start small as long as focused, with a mission,financial support and technical knowledge they will succeed. I encourage other women to venture into mining to develop and become entrepreneurs because as a small scale miner one can also register and make it a company and have a future inheritance.

A small scale miner at her mine

In the past some jobs were on said to be for man only but now also women can do, (e.g mining ).Because of economic hardships women venture into believed male dominated Businesses to take care of their families.Women are responsible and disciplined business people (Almost 90% of children in the world are raised by women) If a woman is financially free she raises a community, then a community a nation. It’s high time that all women discover their strength and change the way they think especially young women in Africa ,and venture into mining and other sustainable business.Women were not created for marriage only but to give life.Our mothers were housewives not allowed to work but our fathers left them in poverty. At AMI 2019 One women from Nigeria said in her community women cultivated land and sell crops to take care of their children even when fathers are alive and working they sometimes forget their women in rural areas,the barrier for their development is most women don’t own land and are not included in decision and policy making since 1958 women from Nigeria have struggled to be heard.These problems are faced by African women in different countries .Mining is being done but its difficult for women to venture because of unfavourable policies,terms and lack of financial support , financial institutes need collateral to give business loans and women don’t have collateral. There is need to support women for development in our countries.Through educational programs,Business and leadership training workshops,Financial support and Exchange programs to raise a generation of women with a difference. Everyone need support to succeed in life. I also have been supported to do mining,to be able to stand up for myself and to be able to speak out .

AMI@10women side session

In the past women discrimination and abuse was never discussed, because of the said cultural values women were not included in decision making ,they get remarried without their concern and the children live in poverty and also those that are born of the new marriage ,the causes were land and inheritance didn’t belong to women. Now women have platforms to speak out but still its so hard to be heard . At AMI@10 women group sessions through dialogue we have realised that in our 26 African countries which were present ,in every country these challenges are still available today–women are not allowed to own land-are not included in decision making -child marriages and forced remarriage of women and inheritance rankle. The main cause of these challenges is women don’t have financial freedom they depend on man to survive.They take part in building the inheritance but at the end its all in the man’s name.At AMI women agreed that its time we take control of our financial futures ,work for development in our families and communities,educate others and stand up for ourselves and lead our young girls by example and reduce child marriages and women discrimination.

Young people need support to do mining and other businesses. They need to be educated to rethink about their destiny to avoid desperation and wrong decisions.For decisions that are made out of desperation are dangerous like the formula of using youth and sex appeal to get the attention and influence to survive worked well in our 20s and 30s but it is not the formula to get us wat we want in our 40s and 60s when we have children to take care of.My point is women must be prepared for what might happen in their life, i encourage women to tell themselves the truth about who or what they are depending upon for their financial future.ln my opinion African women must be supported to invest in mining and also venture in other businesses and industries to ensure a secure future for themselves and their children.

Investors come to Africa to do mining,they get profits and went back to develop their own countries. Our communities are left with nothing no schools or hospitals are built but rather they left our families in poverty and illness after looting away all the minerals employing our parents in the mines paying them insufficient salaries without pensions or compensation.At AMI2019 we realised that the majority of people in our communities are surviving through ASMining it is a livelihood. The sector operates in an environmental friendly and sustainable way.The environmental harm can be manageable than with big mines. I also have realised that ASM is not only in (Zimbabwe ) my country ,but it is a livelihood to many women and youths in Africa. Many have developed their homes, provide food for the family, raise and educate their children through ASMining, though with artisanal mining development is still low due to the illegal operations. Most of the countries at AMI cry out with 1 voice~~ “Artisanal mining must be formalised and create safe working space to benefit the mining communities”.

ARTISANAL MINING

Artisanal miner is an unregistered person who extract minerals without a license.ln my community they do panning in rivers or valleys.ln the forests they use gold detector to discover nuggets by scanning the ground or (reeping) .After discovering , buyers will come and buy from them.On gemstones they discover again but they also sell to the informal markets where there are no fixed prices but prices favourable to the buyer.This group of people contribute more to the world at large because they discover larger amounts of minerals and sell to the informal markets or agents of formal markets, most of the buyers are from abroad.This group of miners don’t benefit or develop through their minerals because they sell out of fear and desperation for they are not legal handlers of minerals if they are caught they will get a jail sentence. On knowing this illegal buyers will always take advantage of artisanal miners.

Artisanal women miners

Formalise artisanal mining for development.

Artisanal mining is a livelihood to mining communities in our developing countries.lf artisanal miners are formalised it will benefit the country because they will sell minerals to formal markets and also pay tax. They will also develop their homes and communities.lt will also create employment opportunities and reduce crime rates. It will also create safe working space for Women artisanal miners,who work in the forests or rivers with children on their back.Its a call to our governments, non governmental organizations and mining stakeholders to take into consideration these group of people for they are less privileged and the majority in many african countries.The mining industry is currently the one reviving the African countries economy.

In mining as a women i faced so many challenges at first because of lack of technical knowledge, discrimination ,my operations were poor and it leads to high stuff turnovers and low production everytime.Like every other business person i have had my share of ups and down.Through it all i have learnt so much and now im using my experiences to develop.my vision is to inspire other women through my work and development.My words to African women are

” Let’s stand up and start now.Start where you are,with what you have ,change start with you and me,lets speak out and find ways to help and empower other women in our communities, remember the journey of a thousand miles start with one step.”

(Job 28 v1-6″Surely there is a mine for silver, and a place for gold that they refine. Iron is taken out of the earth,and copper is smelted from the ore.As for the earth,out of it comes bread,but underneath it is turned up as by fire.I’ts stones are the place of sapphires,and it has dust of gold”).

Minerals and natural resources a boon for african women let’s support, inspire and develop the progression of women in the mining Sector.

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Citizens call for responsible investment

As we continue with our mandate of raising awareness among communities to assert and claim their environmental, economic, social and cultural rights within the natural resource and environmental sectors we decided to capture citizens’ voices through images. The month of February saw us touring resource rich communities in Zimbabwe where we captured the images that portray the grave injustices that have been brought about by mining investors. The 13th of March saw the organisation bringing together Chivi community members and local leaders for a Photo Voices Exhibition which was held at a community hall.

The pictures evidently illustrate that although Zimbabwe is endowed with vast mineral deposits, very little benefits have been realized. From the photo voices shooting it was revealed that host mining communities suffer environmental, socio-economic and cultural rights violations occasioned by state and non-state actors.

Currently, Zimbabwe’s mining sector is one of the major sectors of the economy that still has a large proportion of foreign ownership. However, while commonly presented as a sector providing development opportunities for the national government and local communities, mining has also been named ‘‘the evil sector’’ because of its projects that repeatedly trigger a cocktail of problems such as livelihood shifts, displacements from ancestral lands and insidious social, cultural, environmental, and economic changes. By its very nature, the mining industry, just like the oil and gas industries, leaves behind a ‘‘footprint’’ of environmental, social, and economic impact.
A case in point being Mutoko, Mutoko is located in the northeastern part of Zimbabwe. It lies within Mashonaland East Province and shares boundaries with Murewa, Mudzi, and Nyanga Districts. In terms of socio-economic development, Mutoko District is ranked among the ten least developed districts in Zimbabwe inspite of the proliferation of granite mining. Mutoko villagers despite living in the midst of the sought after precious granite stones which are in high demand in Europe and America are living in abject poverty. Mining in the community can be traced back to 1972 but the locals have nothing to show for it. According to the Global Press Journal, Mutoko granite was used in the construction of the $82 million Royal Danish Library in Copenhagen, Denmark, which measures 21 500m2. At least seven companies are extracting granite in the district. However, relations between some investors and the locals remain sour. The locals are blaming the companies for not protecting their social, economic and cultural rights. Sliced mountains, random cutting down of trees and water grabbing have left Mutoko district a living example of the ecological crisis bedeviling planet earth.
At least two families have lost their loved ones who fell into gullies left open by granite mining companies in the district. Granite extraction has also impacted their cultural beliefs and practices in ways that are detrimental to their well-being. In the Nyamutsahuni area, a Chinese company desecrated graves in search of the precious stone and for the locals this is unacceptable and totally against their cultural beliefs.
From the interviews conducted during the photo voices shooting, the perception amongst the locals has been the ineffectiveness of the local leadership in solving problems and controlling the actions of investors. Issues of corruption and political party allegiance also came under the spotlight. For the locals, citizen participation although legislated is not being put into consideration by the leaders. The lack of upward flows of information and citizen roles within the rest of the system gives little meaning to the notion of citizen participation in natural resource management and its governance.

Zimbabwe’s indigenous communities must fully benefit from the mineral resources. There is an emergent realization that mining could be a key instrument in establishing infrastructure for development. This is embodied in Africa’s Mining Vision (AMV) that contains important strategies for the maximization of the impact of mineral resources on growth and development. Many African countries do not have sustainable development principles in their national mining policies. Therefore, the AMV aims to achieve a “knowledge –driven African Mining sector that catalyses and contributes to the broad-based growth and development.

For the communities, policies must be suitably tailored to promote inter-generational equity in the mining sector. Without the necessary legal predicate, local communities in Zimbabwe will continue to suffer at the hands of mining companies. A mutually beneficial partnership between the state, the private sector, civil society, local communities and other stakeholders must be developed. Harnessing mineral resources for economic development and community empowerment is critical in addressing the poverty scourge and overally improving the quality of life for all Zimbabweans.
As ZELA, we are running the Responsible Investment campaign where we are calling on the Government of Zimbabwe, mining Companies and other duty bearers to ensure that mining operations are not violating the rights of local communities. To get involved in the campaign, follow the hashtag #ResponsibleInv on Facebook and Twitter. Please kindly follow the link https://www.ipetitions.com/petition/responsible-investments-campaign#.W5d and sign an online petition.

Champions needed to jumpstart mineral revenue transparency reforms

By Mukasiri Sibanda

Many times, it has been stated, Zimbabwe is open for business. But, can Zimbabwe be open about business, especially mining deals. Limited transparency in the mining sector disempowers citizens on holding government and corporates accountable. It is impossible for citizens to scrutinise decisions and to ask questions on how mineral wealth is managed to uplift their living standards, better schools, modern hospitals and access to clean and safe water.

Possibly, a glimmer of hope comes from the 2019 National Budget Statement which made a firm commitment to implement the Extractive Industry Transparency Initiative (EITI), a global best practice. This is not a new development, however. In 2011, the Zimbabwe Mining Revenue Transparency Initiative (ZMRTI), an adapted version of EITI was fruitless.

Thereafter, respective National Budget Statements from 2012 to 2015 included commitment to either resuscitate ZMRTI or implement EITI, which also proved to be fruitless. Whilst the 2019 National Budget Statement managed to relight policy conversation on EITI, past lessons are telling. Unless something different is done, mining sector transparency reforms will remain elusive.

Given Zimbabwe’s struggles to open the mining sector for public scrutiny, perhaps, champions in government and business are critical to enable openness about mining business, particularly its linkages to sustainable development. The role of champions gains elevation considering key developments around devolution. Local government and mining companies have an opportunity to take leadership role on promoting transparency, citizen participation and accountability in the management of mineral resources.

With this objective in mind, the Zimbabwe Environmental Law Association (ZELA), facilitated a one and half day workshop on strengthening mining local fiscal linkages for Mutoko rural district. A district that is well known for producing high quality black granite, mainly, for the international market.

The workshop was held at Mazowe hotel, running from 29 to 30 March 2019. Participants included council committee on finance, community-based organisations (CBOs), Faith Based Organisations (FBOs), school development committees (SDCs), Health Centre Committees (HCC), Ministry of Local Government, and a mining company.

During a discussion on strengthening transparency, participation of residents in generation, allocation and utilisation of mineral revenue, a significant milestone was achieved. Mutoko RDC and Natural Stone, a black granite mining company agreed to public disclosure of mineral revenue. Natural Stone was represented by Dr Muvhuro, the human resource manager who have many hats as the spokesperson of Dimensional Stones Producers Association (DSPA) and the current Vice President of the Chamber of Mines.

“As Natural Stone, we have no problem with Mutoko RDC publicly disclosing our tax payments. Intsead, we fear that Mutoko RDC will be in trouble as communities are eager to follow the money and see how it is being utilised. As far as we are concerned, we are up to date in terms of our tax payments” said Dr Muvhuro. Peter Sigauke, Mutoko RDC’s CEO responded that “through our full council meetings which are held quarterly, information on payments made by mining companies is publicly accessible as the minutes are public records. Therefore, we are happy to go a step further to make mineral revenue more accessible to the public”.

Publish What You Pay (PWYP) coordinator, Joyce Nyamukunda remarked that transparency commitments made by Mutoko RDC and Natural Stone were quite significant. This should inspire other resource rich local governments and mining companies in those jurisdictions to publicly disclose taxes paid and received from mining activities.

In conclusion, civil society organisations, government and mining companies must make sure that EITI implementation should not fail. In this process, it is important to mobilise a pool of champions to eliminate any fears that Zimbabwe is open about business in the mining sector. As such, the steps taken by Mutoko RDC and Natural Stone are quite encouraging. “In fact, the disclosure should include environment management information, mining agreements and all payments made to all government institutions” said Joyce Nyamukunda

Devolution can transform resource rich communities

By Mukasiri Sibanda

Inasmuch as Zimbabwe is endowed with huge mineral wealth portfolio, the disconnect between mining and living standards of communities where resources are extracted is quite glaring. A typical example involves the gold sector. Record breaking gold deliveries to Fidelity Printers (FPR) were realised in 2018 – 33.2 tonnes of gold roughly US$1.3 billion against a set target of 30 tonnes. However, sharp shortages of essential drugs, for instance, evinces that record-breaking production in the mining sector has no telling development impact in health and education sectors. The self-inflicted wounds are a result of poor mineral resource management – the gold sector was ranked by Resource Governance Index (RGI) of 2017 number 81 out of 89 countries, with a score of 29 out of 100 against a regional average of 43.

With devolution gaining traction, there is need to ventilate challenges, opportunities and progress on harnessing mining for sustainable and broad based local economic and social development. Perhaps, such an exercise can spur strong public conversation on how minerals can deliver elusive benefits to communities to reverse the undermining of development opportunities stemming from mining. Devolution is provided for in the Constitution under Section 264. Decentralisation of governmental powers and responsibilities to provincial and local government is the cornerstone of devolution. Among its constitutional objectives, devolution seeks “to recognise the right of communities to manage their own affairs, and to ensure equitable sharing of local and national resources.”

Harnessing mining revenue for local mobilisation of finance for development

Under Section 276 (2) (b), local authorities are empowered “to levy rates and taxes and generally to raise sufficient revenue for them to carry out their objectives and responsibilities.” Despite this constitutional power, resource rich local authorities have generally struggled to capitalise on enormous economic activities in their jurisdictions, mining particularly, to boost their purses to finance development. Largely, this challenge emanates from the fact that local authorities are “rule takers and revenue takers.” A case in point is the outdated local mining tax collection system under the Rural District Council (RDC) Act. For the purposes of calculating mining taxes due to any local authority, in the case of precious minerals, manual labour is used as a base. As an example, 100 manual labourers equate to a unit, and the rate for that unit is negotiated yearly between a local authority and mining companies.

Absolutely, such an arrangement is not tenable. Labour has been upstaged by machines as a driver of production in the mining sector. A position that is set to get worse as the wave of the forth industrial revolution is unavoidable. Syama mine in Mali has become the first fully automated underground mine in the world. To achieve a progressive local mining taxation structure, it is prudent to consider a value-based approach rather than a manual labour-based approach. For example, 2% of gross income generated per mining project should constitute local mining tax contribution.

Fiscal linkages not enough without the power of foreign currency linkages

Mining is the country’s lead foreign currency generator, contributing not less than 50% of the country total export earnings since 2010. It is unfortunate that in districts where foreign currency is mined, taxes are paid using a weaker currency – RTGS dollars. Agreed local mining tax arrangements were premised on the basis that US dollar and RTGS dollar are equal, 1:1. When the exchange rate was liberalised later through the 2019 monetary policy statement, some mining companies refused to adjust payments to accommodate the official exchange rate. As a result, the spending power of local authorities was severely eroded. Even payments made to community share ownership trusts (CSOTs) or their savings were not spurred because they are not backed with foreign currency linkages. Examples include Marange-Zimunya Community Share Ownership Trust which received $5 million last year (2018) from Zimbabwe Consolidated Diamond Company (ZCDC). Zvishavane CSOT had roughly $3 million set aside for income generating projects.

Another revenue stream for local authorities which has been hurt because poor foreign currency linkages is $310 million set aside for devolution in the 2019 national budget statement. According to Section 301 (3) of the Constitution, at least 5% of national generated revenue in a given fiscal year must be allocated to provincial and local authorities. It is worthwhile to flag out that this constitutional arrangement was not been complied with since 2013 when the new Constitution came into effect. Therefore, the ground-breaking move by the Ministry of Finance to comply with Section 301 of the Constitution in 2019 has its development lights dimmed because the power foreign currency linkages is missing.

Uncertainty around community share ownership trusts

The State is constitutionally compelled to put in place mechanisms to ensure communities benefit from resources in their localities in line with Section 13 (4) on national development. In the quest to attract investment, government is operating on “Zimbabwe is open for business” mode. In 2018, the Finance Act removed indigenisation requirements for all minerals apart from diamonds and platinum. As a result, sustainability of CSOTs outside diamond and platinum sectors is now doubt. As if that is not enough, the Ministry of Finance stated in March 2019 that government intends to scrap indigenisation requirements for diamond and platinum sectors.

Whilst the pace at which CSOTs were being implemented was frustrating, the principle behind the law must never be discounted. Community Share Ownership Trusts were birthed under the indigenisation and economic empowerment regulations of 2010. Under this arrangement, foreign mining companies were required to cede 10% ownership to local communities. Only 2 out of 61 CSOTs received equity from mining companies, and these are Gwanda and Umuguza. In the platinum sector, Zimbabwe Platinum Mines (Zimplats), Unki mine, and Mimosa Mine paid $10 million each to CSOTs in their areas of operation. Amazing progress was recorded on the ground on investment in infrastructure, schools and clinics despite huge infrastructure gaps that are still persistent.

Undoubtedly, removing CSOTs rather than enabling the implementation of CSOTs goes against the spirit of devolution and can further marginalise resource rich communities from benefiting from mining. Why ditching a winning formula? Vision 2030, attaining upper middle-income status certainly will prove to be a huge disaster if it does not address inequality. Inspiration must be taken from leave no one behind, the motto for the Sustainable Development Goals (SDGs) targeted at 2030.

Earmarked mineral revenue streams

There are service delivery funds that are linked with mining albeit not exclusively. Such funds include the rural electrification fund, aids levy, and the Zimbabwe Manpower Development Fund (ZMDF). Mining as a huge consumer of electricity, follows that the sector is a significant contributor to the rural electrification levy. Blanket Mine, for example, contributed 466,322 to the rural electrification fund in 2016 alone. There is hardly tangible evidence of any meaningful plough back of revenue ringfenced for service delivery in communities where the funds are generated. This is an opportunity for resource rich local communities and RDCs to follow the money, demand transparency and accountability to mobilise efficiently resources for enhancing local economic and social development.

Conclusion

Clearly central government has not fared well in terms of managing mineral resources for the benefit of resource rich communities as required by the Constitution. Devolution comes as an incentive for resource rich local authorities to harness the elusive local development dividend from enormous economic activities in their localities – mining obviously takes the centre stage. To achieve this, CSOTs must not be sacrificed to attract investments, transparency and accountability of mineral revenue is important to amplify development opportunities from service delivery funds like rural electrification funds. From areas where foreign currency is extracted, it is atrocious that essential drugs shortages are experienced because of scarce foreign currency. Therefore, fiscal powers of provincial and local authorities need to be backed by foreign currency linkages to enhance local economic and social development programmes.

Zvishavane Community Share Ownership Trust Uncertainty: What You Need To Know

By Mukasiri Sibanda

Communities have a constitutional right to benefit from resources in their areas in line with Section 13 (4) on National Development. Given government’s inclination to open Zimbabwe for business, there is an ominous risk that investors get prioritised over community rights is ominous. In March 2019, the Minister of Finance, Prof Mthuli Ncube boasted that government has so far sealed US$8 billion deals in the mining sector. But the exact connection between mining mega deals and benefits accruable to communities are not clear. The mining deals are not open for public scrutiny despite the constitutional requirement that Parliament must play and oversight role during negotiation of mining agreements together with performance monitoring of existing mining contracts – Section 315 (2) (c).

What is clear is that the Finance Act of 2018 destroyed the legal backing of Community Share Ownership Trusts (CSOTs) for all mineral sectors apart from diamond and platinum. Under the indigenisation framework of 2010, foreign companies in the mining sector were required to cede 10% equities to communities. Government has expressed intentions to remove platinum and diamond sectors from complying with indigenisation requirements.

Below are the facts and figures on Zvishavane Community Share Ownership Trust (ZCSOT) which communities affected by mining operations and interested parties must know. The below facts and figures were compiled during a workshop organised by the Zimbabwe Environmental Law Association (ZELA) in Zvishavane on 10 and 11 May 2019. The purpose of the workshop was to help communities with skills to follow mineral revenue to strengthen linkages between mining and local economic and social development.

ZCSOT was launched in 2012
ZCSOT has no share ownership in any of the mining companies that are operating in Zvishavane.
Initially, Mimosa platinum mine pledged to give ZCSOT US$10 million
Because Mimosa mine also has claims in Mberengwa district, $3 million was given to Mberengwa CSOT and ZCSOT received $7 million.
The size of Mimosa’s platinum claims in Zvishavane and Mberengwa was used to allocate the $10 million pledged by Mimosa.
Murowa diamonds initially pledged US$1 million to ZCSOT
Later, the US$1 million pledge by Murowa was split equally between Zvishavane and Chivi district and the formula used to split the pledge was not clear.
Murowa diamonds paid $300,000 to ZCSOT and $200,000 is outstanding.
Unki platinum mine operating in Tongogara has platinum claims in Tongogara and Zvishavane districts. However, the $10 million pledged and paid to Tongogara CSOT by Unki mine was not shared with Zvishavane CSOT. Yet ZCSOT shared amounts pledged with other districts because of contiguous mineral deposits.
The current balance in ZCSOT coffers is RTGS$3.5 million. Sadly, mining is the lead foreign currency earner in Zimbabwe but fiscal linkages are backed by a weaker local currency – RTGS$.
ZCSOT’s footprint concerning infrastructure development, schools and clinics is visible in all 19 wards in Runde rural district.
Resettlement areas which have huge infrastructure deficits are the main beneficiaries of investments undertaken by ZCSOT. This is in line with constitutional principles of public financial management which requires that resources must be allocated for the benefit of marginalised areas and marginalised groups
$5,000 was allocated to each ward to cater for their development priorities. Some wards have failed to spend the money that was allocated to them.
ZCSOT was not affected by the softening of the indigenisation framework in 2018 by the Finance Act. All mineral sectors are no longer required to comply with indigenisation requirements apart from diamond and platinum sectors. Zvishavane has diamond and platinum mines.
The future of ZCSOT is uncertain. The Finance Minister, Prof Mthuli Ncube opined that government will soon introduce measures to remove platinum and diamond sectors from complying with indigenisation framework.
To ensure sustainability, ZCSOT is now focusing on community enterprise development for income generation.