Zimbabwe's Performance on the Resource Governance Index
Zimbabwe received a "failing" score of 31, ranking 51st out of 58 countries. A "partial" score on Safeguards & Quality Controls contrasted with a particularly low Enabling Environment score.
(out of 58)
(out of 100)
|44||Institutional & Legal Setting||48|
|29||Safeguards & Quality Controls||56|
Institutional & Legal Setting (Rank: 44th/58, Score: 48/100) learn more
Zimbabwe's "weak" score of 48 reflects a non-competitive licensing process and the lack of mechanisms to promote public accountability in the mining sector.
Mineral exploitation rights are vested in the president. The Mining Affairs Board and the Mines and Mining Development Ministry review license applications and the president approves them. Major companies often negotiate contract terms directly with the government, and industry representatives, including officials of state-owned companies, sit on the Mining Affairs Board, compromising its independence.
National law requires that licensing decisions be made in the "national interest." In the face of sanctions against Mugabe's government by Western countries, the "national interest" clause has been used to subvert the normal bidding process and award mining licenses to companies from countries considered friendly to Zimbabwe, such as China, the United Arab Emirates, Russia, South Africa, and India.
The Zimbabwe Revenue Authority collects taxes, but the Finance Ministry has complained that a significant portion of mineral revenues never reach the treasury. Legal provisions establishing the public's right to information include broad exceptions limiting access to mining data. Companies must perform environmental impact assessments, but sometimes complete them only after extraction has already begun.
Reporting Practices (Rank: 52nd/58, Score: 23/100) learn more
The government provides very little useful data on the mining industry, resulting in a "failing" score of 23.
Zimbabwe's disclosure policies ostensibly promote transparency and public oversight of the extractive industries. In reality, the public—and even other government agencies—know very little about licensing processes and contractual arrangements with mining companies. Contracts are not disclosed and environmental impact assessments are available only for very high fees.
The Finance Ministry publishes current information on mineral production, prices, exports, investment, production costs, royalties, and dividends. The Zimbabwe Revenue Authority does not provide sector-specific revenue data, and the Mines and Mining Development Ministry publishes little or no information on extraction. The Reserve Bank of Zimbabwe publishes historical data only.
Safeguards & Quality Controls (Rank: 29th/58, Score: 56/100) learn more
Zimbabwe received a "partial" score of 56, reflecting marginal legislative oversight and incomplete auditing mechanisms.
The president has wide discretion in licensing, allowing favored applicants to bypass the bidding process. Some companies appear to have been exempted from taxation in return for their investment in critical industries. Parliament rarely exercises its right to review contracts with mining companies; in any case, the president has no obligation to act on Parliament's decisions.
The Office of the Comptroller and Auditor-General is required to review public accounts and report to lawmakers. However, the state's limited resources and highly charged political climate have weakened the oversight role of parliament, and government auditors lack the capacity to review mining revenues effectively. Audit reports are not published.
Enabling Environment (Rank: 55th/58, Score: 6/100) learn more
Zimbabwe's "failing" score of 6 is the product of extremely low global rankings on the rule of law and government effectiveness.
State-Owned Companies (Rank: 37th/45, Score: 22/100) learn more
There are many state-owned mining companies, including the Zimbabwe Mining Development Corporation (ZMDC), which is entirely government-owned. With insufficient funds in the treasury, state-owned companies sometimes act as quasi-governmental agencies, funding academic programs or paying civil servant salaries. The business dealings of these companies are opaque; they do not publish annual reports and have been accused by the Finance Ministry of failing to pay taxes. While audits of ZMDC are required, the reports are not available to the public.
INSTITUTIONAL & LEGAL SETTING
SAFEGUARDS & QUALITY CONTROLS
To explore all data and compare country scores, use the RGI Data Tool.
Key Economic Indicators
|GDP (constant 2011 international $ billion)||8.5||6.5||9.7|
|GDP per capita, PPP (constant 2005 international $)||..||..||..|
|Extractive exports (% total exports)||12||24||36|
|Sources: Oil and gas revenue as share of total government revenue from the Economist Intelligence Unit and the International Monetary Fund. All other data form the World Bank. Extractive exports 2011 data from 2010.|