Deep-rooted mistrust between governments and the mining sector is a major stumbling block against the growth and sustainability of the private mining sector, the chief executive officer for the Chamber of Mines of Namibia Veston Malango (pictured) has warned.

In a virtual address at the recently held Zimbabwe Annual Mining Conference, Malango said the situation can be so bad that in some cases, governments may not comfortably sit on the same table with the private sector for a dialogue.

"Governments are suspicious of industry wrongdoing, that we are hiding something, that the host country is not benefiting enough from the country’s mineral resource endowment. In several Sadc countries, including Zimbabwe, governments are also players in the industry with minority, major or even majority shareholding in several mining companies, so one would assume that the trust relationship should even be stronger is such cases," Malango said.

"Why should there be suspicions of wrongdoing when government is represented at boards of some mining companies and have access to financial and other operational information?"

He explained that these acrimonious relationships have led to bad policy decisions that have not yielded the anticipated benefits.

"I can understand that this is out of frustrations, especially when we have some bad eggs amongst ourselves, bad players in the mining industry whose behaviour may not be in line with the majority of industry players who are, truly partners with host governments in the socioeconomic development agenda," he said.

"Unfortunately, even with the assistance of international institutions such as the Extractive Industry Transparency Initiative (EITI), it’s not water proof that there will be no bad eggs to tarnish the good name of the majority players in the entire extractive industry. It is therefore imperative that the industry becomes proactive in protecting its image."

Malango said the basis of this partnership should be a mutual trust relationship between the government and mining/exploration companies. He shared an experience from Namibian mining industry where the Chamber of Mines has managed to earn the trust of government and cemented the trust relationship with winwin outcomes.

"t must be earned, out of good corporate citizenship and abiding by the laws of the country, in addition to integrity, transparency, governance and commitment to support the socioeconomic aspirations of the host country.

"I believe the Zimbabwe mining sector is committed to do all these things and in return, they expect the government to provide an enabling environment in which mining can thrive, an environment with a competitive and stable tax regime amongst others. Mining can only thrive in an environment of policy and regulatory certainty, good governance, political stability, rule of law, and devoid of bureaucracy and corruption allegations, etc."

Malango noted that in order to address these challenges of deep-root seated mistrust it was his firm belief that Chambers of Mines in SAD C need to go beyond advocacy and play the role of selfregulation amongst its members. This, he said, is important as industry players are diverse, comprising foreign largely multinational companies, local investors and smaller local players that include artisanal and small-scale miners.

"Unfortunately, when one company does not comply to the rules of the host country, governments tend to generalise and paint the whole industry with the same brush," Malanga said adding that this is an opportunity for the industry to show commitment of good corporate citizenship, through a self-regulatory system under an industry body such as the Chamber of Mines.

"In Namibia, the Chamber of Mines has on two occasions in the last ten years expelled two mining companies for bringing the industry into disrepute, for not complying with the Chamber Constitution and the laws of the country, including safety regulations.

"Can you imagine what this action would mean to a public listed company? This is the leverage we have, a sjambok so to speak! We have received accolades/congratulations from the Namibian government because this is a demonstration that the chamber is not just an industry advocacy body, but also plays the role of a self-regulatory body. These actions have earned us immense trust by the government. This is the secrete of our success in Namibia and I believe the same could be emulated in Zimbabwe and the rest of Sadc."

Malango reiterated that the issue of trust relationship between the government and the private sector, is a fundamental prerequisite for economic revival post Covid-19 and sustainable growth of the Zimbabwe mining sector.

"This topic is so relevant under the current circumstances we find ourselves in, and the unique opportunities that have presented themselves for the revival of the mining sector in Zimbabwe, Sadc and indeed the rest of Africa.

"The impact of the Covid-19 on the global economy has not spared us in Africa, and specifically Sadc countries. Mining remained resilient and sustained our economies when other sectors of the economy such a tourism, hospitality, aviation and construction had almost collapsed due to the pandemic."

He applauded governments in the region for doing their best to contain the virus with meagre resources.

"It has been a delicate balance between saving lives and saving livelihoods. With the arrival of vaccines and continued adherent to Covid protocols, there is hope of arresting the transmission and getting to herd immunity. However, the third wave currently ravaging some parts of the world such as India and now Africa, are a major source of concern," he said .

Malango, however, said like in any crisis there are opportunities, and there was need to be alert and identify them. He also challenged Zimbabwe, Sadc and rest of Africa, to rise from the ashes of this pandemic stronger than before.

"And here is why. The global commodity markets have rebound few months into the Covid outbreak, after an initial slump at the beginning.

"Gold outperformed all minerals, and soured to US$2 067 per ounce in August 2020, reaching its highest level in recent history. This is because gold is considered a safe haven for investments in times of uncertainty.

"Prices of base metals, battery minerals, and most other minerals picked up tremendously. The copper price traded above US$9 000 per tonne in December 2020 and hit US$10 747 per/ tonne in May, 2021, a level last seen 10 years ago in 2011." — Staff Writer.