Investors are paying close attention to the possibility of direct investment in the Zimbabwe mining sector with an investment horizon of up to 30 years, says stockbroking company Imara Edwards Securities executive director Tino Kambasha.
This is based on the response of international investors at the fifth yearly Imara investor conference held in Harare, Zimbabwe, earlier this month.
“During the conference, one of the larger companies present mentioned that . . . mining invest- ment in Zimbabwe should be long term in nature, between 20 and 30 years, and this sentiment seemed to be shared by the others present,” Kambasha tells Mining Weekly.
“This is extremely positive, as it suggests strategic interest in the Zimbabwe market rather than a tactical play,” he adds.
Kambasha believes that one factor driving the positive long-term sentiment was the recent approval of Zimbabwe’s new Constitution.
“The politics in Zimbabwe quieted down, with government engaging more with investors. We had a peaceful referendum and a new Constitution was voted in by all Zimbabweans, with a record amount of votes, compared with previous elections.
“The Constitution also sailed through Parliament and Senate without a hitch, signalling the willingness of all parties to make a new start. Since then, it has been signed into law by the President,” he says.
In addition, investor returns are high and, at one point, they were the highest in the world during the last 12 months, Kambasha adds.
He points out that, as long-term capital is usually cheaper and more stable, longer-term investment will enable mining companies to explore minerals more efficiently on a much larger scale.
“The more resources we prove up, the more capital we can source and the more mining we can do. “ This increases the revenue to the fiscus and, hence, we can afford to increase the pace at which we are rebuilding our country,” he says.
The Imara conference, which was centred on the recapitalisation of businesses, growth potential and the effect of elections on business, was attended by more than 130 delegates, with the largest contingent of potential investors coming from South Africa.
North American and Middle Eastern asset mangers were also present and Imara has recently seen strong interest from Japanese analysts.
During the conference, the delegates were also taken on a tour to Aim-listed Mwara Africa’s Bindura Nickel and Freda Rebecca mines, along with Toronto-listed New Dawn’s Dalny gold mine.