Rio Tinto caves to Zimbabwe gov pressure

 Rio Tinto’s Zimbabwean operations Murowa Diamonds has ceded control of the mine.

The miner gave 51% of equity in the operation following new laws in the country, which forced miners to give the majority of ownership to local Zimbabweans, or face expulsion from the African nation.

"By end of September any mining companies that do not comply, we will kick them out," indigenisation minister Savious Kasukuwere said earlier in the year.

“We have received 175 proposals from mining companies and we’ve turned down all of them. The proposals were that 26% would be done through social credits and 25 percent direct equity," he said.

The Zimbabwean Government said the miners could earn social credits towards their proposals by investing in local infrastructure development projects such as schools, hospitals and roads as well as training local workers.

“Murowa Diamonds wrote to us yesterday saying they have given up 51 per cent [of] shares and these would be given to our people,” the state-owned Herald newspaper quoted indigenisation minister Saviour Kasukuwere as saying, according to the SMH.

The law has come under fire from Zimbabwean prime minister Morgan Tsvangirai, who labelled it looting and plunder by a greedy elite”.

Some foreign owned mining companies in Zimbabwe are still against the legislation, Kasukuwere saying “there seems to be an element of resistance.

“However, I am meeting the various mining houses to achieve agreement on compliance with the law,” he said, Talk Zimbabwe reports.

He went on to say that there is no going back on the empowerment regulations.

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