Zimplats invests US$460 million in local economic development

Nqobile Bhebhe, nqobile.bhebhe@chronicle.co.zw

ZIMBABWE’s giant platinum group metals (PGM) producer, Zimplats, has splashed nearly US$460 million towards supporting the domestic economy under its Local Enterprise Development (LED) programme since 2013, thereby helping the country create thousands of local jobs.

Last year, amid a global downturn in commodity prices impacting production value chains, Zimplats contributed US$53 million, a 19 percent decrease from the previous year’s US$66 million expenditure.

This spending reduction reflects the broader economic challenges facing the mining sector due to price volatility.

However, the commitment underscores Zimplats’ dedication to local economic development, even amid challenging global market conditions.

The LED programme was launched in 2013 to capacitate and grow local indigenous companies and the objective is to align the LEDs to the standards of Zimplats’ way of doing business and core values.

According to Zimplats’ Full Year 2024 annual report, a total procurement spending amounted to US$700 million, a six percent decrease against last year’s spending of US$742 million.

“Local spending totalled US$357 million, which is 51 percent of the overall spend for FY2024. The dip in foreign spend was mainly attributable to Zimplats’ reduction in growth and expansion capital projects, while the local spend increased slightly by two percent,” said the company.

The goal of the enterprise and supplier development strategy in Zimplats’ social performance framework is to accelerate inclusive economic growth through supportive inclusive procurement. The focus area includes development of enterprises that are beyond the value chain of Zimplats.

Key tenets of the LED programme include prioritisation of procurement from local, and host community enterprises, development of previously marginalised youth and women enterprises and support for the development of resilient small and medium enterprises (SMEs) in our value chain and beyond.

Zimplats said despite the subdued business activity due to the ongoing low metal price environment, management kept supporting its various LED entities within the confines of the available resources.

The LEDs programme aligns with Social Development Goals (SDG) 8.3, whose focus is on supporting job creation and the growth of enterprises.

The programme comprises 23 SMEs, of which 30,4 percent are women and youth enterprises and companies are all guaranteed a certain level of business within Zimplats.

On employment creation, the mining house said as of June 30, 2024, the 23 local enterprises provided employment for 2 666 people, drawn mainly from the local communities.

The decline was on account of the slowdown in project implementation caused by the depressed global metal prices and the fact that some of the projects were nearing finalisation, it said.

The LEDs entities supplied Zimplats with various products and services, which included engineering services, medical supplies, haulage, trucking, borehole drilling, labour broking, underground support, legal advisory services, insurance brokerage, catering and facilities management solutions, protective clothing, bricks, and silica supplies.

As of June 30, 2024, LED programme spending amounted to US$53 million, a 19 percent decrease compared to 2023 spend of US$66 million.

The decrease is in line with the curtailment of some projects due to depressed global metal prices.

Since the programme’s inception in 2013, a total of US$460 million has been invested in procuring goods and services under the LED programme.

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