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Debt-ridden Zimbabwe has inked a USD 12 Mn mining deal as the economy struggles to stay afloat.
A Russian diamond firm Alrosa signed a deal to mine diamonds in the resource-rich country. The Emmerson Mnangagwa-led country is currently taking advantage of its immense mineral resources as it attempts to revive its economy.
Russian diamond company Alrosa on Tuesday signed a deal to explore and mine diamonds in Zimbabwe, as the southern African nation seeks to leverage its mineral resources to boost the country’s ailing economy.
Following the signing of the deal, Alrosa will explore, extract, and market country’s diamonds, in a new move aimed to transform the country’s diamond sector. The deal is expected to see an increase in diamond output and propel the sector to achieve 10 million carats by 2023.
Alrosa CEO Sergey Ivanov said his company would invest an initial USD 12 Mn in the venture. “We are hoping that exploration will start in September. We see a lot of potential and we will invest more in the coming years depending on the outcome of the exploration.”
While officiating the deal between Alrosa and the Zimbabwe Consolidated Diamond Company (ZCDC), mines and mining development minister Winston Chitando said there was a lot of scope for investment.
“This is a joint venture between Alrosa and the ZCDC. It will look at greenfield and brownfield projects. So there will be an exploration in new areas that are not known to have diamonds, and there will also be work in areas such as Marange and Chimanimani which are known to have diamonds.”
“This is part of our vision to produce 10-million carats annually and to earn $1bn every year from diamonds,” he said.
Zimbabwean President Emmerson Mnangagwa was present to witness the officiating of the joint venture. He said the deal has bore fruits owing to the country’s good relations with Russia. The president earlier sought funding for mining investments in the country.
“After extensive negotiations, ZCDC and Alrosa have agreed to a mutually beneficial partnership in diamond exploration, mining, and marketing; as well as both greenfield and brownfield exploration and mining projects,” he said.
“I am, thus, confident that the joint venture signed here today (yesterday) will enhance skills and technological transfer as well as create income and empowerment opportunities in the respective mining communities and Zimbabwe as a whole,” he added.
President Mnangagwa assured both Alrosa and ZCDC that Government would ensure the venture becomes a success.
ZCDC’s Mr. Ukuma noted that the deal is a stepping stone for the country as it aims to become one of the top five rough diamond producers in the world in the next five years.
“This joint venture will yield significant benefits to the communities and the nation through employment creation, generation of foreign currency, contribution to the fiscus, enterprise development and upliftment of communities,” said Mr. Ukama.
Featured Image Courtesy: Marketplus
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