Mining and Structural Adjustment

108 Pages·2006·1.63 MB·English

Research Report no. 92
Chachage Seithy L. Chachage
Magnus Ericsson
Peter Gibbon
Mining and Structural Adjustment
Studies on Zimbabwe and Tanzania
Nordiska Afrikainstitutet
(The Scandinavian Institute of African Studies)
Uppsala 1993
Structural adjustment
Typesetting: Kajsa Overgaard
Language polishing: Elaine Almen
ISSN 0080-6714
ISBN 91-7106-340-4
The authors and Nordiska Afrikainstitutet, 1993
Printed in Sweden by Motala Grafiska AB, Motala 1993
Contents
Fore word
Peter Gibbon
MINING INVESTMENT, STRUCTURAL ADJUSTMENT AND
STATE-MINING CAPITAL RELATIONS IN ZIMBABWE
Magnus Ericsson and Peter Gibbon
Abbreviations
Exchange Rates
Maps
Introduction
The Zimbabwean Mining Industry
Investment Flows and Zimbabwean Mining
Politics and Economic Policy in Post-Independence Zimbabwe
The World Bank and African Mining
Views from the Zimbabwe Mining Houses, 1991
Summary and Conclusion
Appendix: Zimbabwe's Mining Legislation
References
NEW FORMS OF ACCUMULATION IN TANZANIA:
THE CASE OF GOLD MINING
Chachage Seithy L. Chachage
Abbreviations
Maps
Themes for Discussion
The Politics of Interpreting Economic Change in Tanzania
Gold Mining in Tanzania
Concluding Remarks
References

Foreword
The mining industry was an important focus of scholarly and politi-
cal discussion amongst Africans and Africanists during the 1970s. At
this time most debate concerned the economic and political implica-
tions of the seemingly inexorable expansion of the influence of
multi-national mining houses, and of the actions of African states
anxious to restrict their influence and gain access to their revenues.
From the mid-1970s the interest uf these companies in most areas of
Africa apparently declined, and discussion about African mining
followed this same trend.
The 1990s have seen a revival of interest in the topic of African
mining for four reasons. Firstly, structural adjustment programmes
have been adopted by most African governments. Amongst their
central features is a more welcoming attitude to private capital in
general and to foreign direct investment in particular. The World
Bank and others envisage that those investors most likely to be at-
tracted by this change are those with traditional experience of Afri-
can investment. Most obviously, these include the mining houses.
Secondly, this 'improvement' in the African investment climate
is accompanied by certain problems attending further investment in
the main growth centres of 1975-90, ie Australia and Canada. On the
one hand, the best deposits are probably all now developed in these
countries. On the other, increasingly restrictive environmental laws
(and laws protecting the rights of indigenous peoples) limit the abil-
ity of companies to exploit new prospects there.
Thirdly, the prospect of a negotiated settlement in South Africa
has already succeeded in allowing South African capital to overcome
its long isolation and begin contemplating new external invest-
ments. The obvious site for mining capital's expansion is elsewhere
in Sub-Saharan Africa.
Fourthly, there has been a growing acknowledgement of the scale
and significance of small-scale or 'artisanal' mining in Africa. This
has come about largely through an increased practical and academic
interest in the growth of the informal sector generally during Africa's
deepening economic crisis.
These two studies, both produced as part of the SIAS research
programme on 'The Political and Social Context of Structural Adjust-
ment in Sub-Saharan Africa', reflect on these themes and others. In
doing so they aim to provide up-to-date information on the coun-
tries examined in a clear and accessible way. However, they do so
from a specific shared perspective.
The authors approach structural adjustment critically. Rather
than seeing it as the necessary instrument of Africa's economic salva-
tion, an effort is made to examine its concrete effects with regard to
specific local situations and constellations of interests.
The authors also systematically distinguish different interests
within the mining industry, not only between countries but also be-
tween different types of mining operations and their operators. Fi-
nally they focus attention on the usually neglected social and politi-
cal dimensions of the mining industry and in particular its relation
to the national and local state in Africa. The paper by Chachage,
moreover, contributes to the task of providing a theoretical
framework linking each of these concerns.
Uppsala, April 1993
Peter Gibbon
Mining Investment, Structural Adjustment
and State-Mining Capital Relations in
Zimbabwe
Magnus Ericsson and Peter Gibbon

ABBREVIATIONS
AAC Anglo American Corpor- UDI Unilateral Declaration of
ation of South Africa Ltd Independence
BHP Broken Hill Pty COL td UN United Nations
CIL Carbon in leach UNIDO United Nations Industrial
Cr Chromium Development Organisation
CZI Confederation of USA ID US Aid Agency
Zimbabwean Industry ZANU (PF) Zimbabwe African Na-
EIU Economist Intelligence Unit tional Union (Patriotic Front)
EPO Exclusive Prospecting Order ZAPU Zimbabwe African People's
FER "Framework for Economic Union
Reform 1991-95" ZCCM Zambian Consolidated
GDP Gross Domestic Product Copper Mines
IDA International Development ZISCO Zimbabwe Steel
Corporation
Agency
IFC International Finance ZMDC Zimbabwe Mining Develop-
Corporation (World Bank) ment Corporation
IMF International Monetary ZNCC Zimbabwe National
Fund Chamber of Commerce
Kilogram ZUM Zimbabwe Unity Movement
Thousand Zimbabwe ZWD Zimbabwe Dollars
Dollars
I.DC Less Developed Country
LSCF Large-Scale Commercial
Farming
MGBP Million British Pounds EXCHANGE RATES
MIGA Multilateral Investment (USD: ZWD)
Guarantee Agreement
MMCZ Minerals Marketing 1 = 0.62ZWD
Corporation of Zimbabwe = 0.73ZWD
MUSD Million US Dollars = 0.74ZWD
MZWD Million Zimbabwe Dollars = 0.96ZWD
OGIL Open General Import = 0.87ZWD
Licence = 1.24 ZWD
OPEC Organisation of Petroleum = 1.61 ZWD
Exporting Countries = 1.66 ZWD
OPIC US Government Investment = 1.89 ZWD
Protection Guarantee = 2.23 ZWD
Agreement
= 2.53 ZWD
PGM Platinum Group Metal = 4.95 ZWD
SADCC Southern African = 5.20 ZWD
Development Coordination
Committee
Metric ton
L
TNC Transnational Corporation
TNDP "Transitional National
Development Plan 1982-85"
UANC United African National
Congress (Muzorewa)