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sharing in governance of extractive industries

Champions can jumpstart mineral revenue transparency reforms

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 pointed questions on how mineral wealth is managed to uplift their living standards, better schools, modern hospitals and access to clean and safe water.

Possible, 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 strengthen 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. Instead, 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

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