First Thing, Daily Maverick's flagship newsletter

Join the 230 000 South Africans who read First Thing newsletter.

We'd like our readers to start paying for Daily Maverick

More specifically, we'd like those who can afford to pay to start paying. What it comes down to is whether or not you value Daily Maverick. Think of us in terms of your daily cappuccino from your favourite coffee shop. It costs around R35. That’s R1,050 per month on frothy milk. Don’t get us wrong, we’re almost exclusively fuelled by coffee. BUT maybe R200 of that R1,050 could go to the journalism that’s fighting for the country?

We don’t dictate how much we’d like our readers to contribute. After all, how much you value our work is subjective (and frankly, every amount helps). At R200, you get it back in Uber Eats and ride vouchers every month, but that’s just a suggestion. A little less than a week’s worth of cappuccinos.

We can't survive on hope and our own determination. Our country is going to be considerably worse off if we don’t have a strong, sustainable news media. If you’re rejigging your budgets, and it comes to choosing between frothy milk and Daily Maverick, we hope you might reconsider that cappuccino.

We need your help. And we’re not ashamed to ask for it.

Our mission is to Defend Truth. Join Maverick Insider.

Support Daily Maverick→
Payment options

To Borrow $500 Million, Zimbabwe Pledges Undeveloped Mi...



To Borrow $500 Million, Zimbabwe Pledges Undeveloped Mine

An armed soldier on a street near a fuel station in the capital Harare, Zimbabwe, 21 January 2019. The country's security forces are on high alert following protests over fuel price increases that rocked the country on 14 and 15 January 2019. Reports state that 12 people were killed and many others when the army shot at the protestors. EPA-EFE/STF
By Bloomberg
23 May 2019 0

The main collateral for African Export-Import Bank’s $500 million loan to Zimbabwe is a mine that hasn’t been dug yet, people familiar with the matter said.

The loan, which will be paid over four years when production starts, is backed by a mine that Great Dyke Investments, a venture between Russian investors and the Zimbabwean military, plans to build at a cost of $4 billion, the people said. The mine, for which Afreximbank is arranging funding, is struggling to attract financiers because of the interest held by the military’s Zimbabwe Defense Industries Ltd.

Still, Afreximbank may be paid back from other platinum sources the government has access to, one of the people said, without giving more detail. Zimbabwe’s platinum mines are owned by Impala Platinum Holdings Ltd. and Anglo American Platinum Ltd. and they sell their output directly to the market.

Short of foreign currency, fuel and medicine and battling the highest inflation since 2008, Zimbabwe is mortgaging its mineral wealth in exchange for foreign currency. Lines of credit from Afreximbank were secured using gold exports as collateral, Zimbabwe’s Financial Gazette reported in February, citing Reserve Bank of Zimbabwe Governor John Mangudya.

Zimbabwe secured the $500 million loan, the origin and terms of which were not disclosed, after businesses complained that the interbank currency market instituted in February wasn’t functional because there weren’t enough dollars to meet their needs. The RTGS$, a quasi-currency that isn’t traded outside Zimbabwe, is exchanged on the market. The government abandoned its own currency. the Zimbabwe dollar, in 2009 after a bout of hyperinflation.

George Guvamatanga, the permanent secretary in the finance ministry, said he couldn’t comment, citing confidentiality agreements. Afreximbank didn’t immediately respond to a request for comment.

Afreximbank, which is based in Cairo and is partially owned by African governments, has lent to Zimbabwe before. In addition to the gold-backed loan it extended a $600 million line of credit to the country in 2017. While the country is mired in an economic crisis, it has the world’s third-biggest platinum group metals deposits and abundant reserves of gold, iron ore, diamonds and lithium. It also has some of the most developed infrastructure in Africa and one of the region’s best educated work forces.

To read more about the mine’s financing struggles, click here

The structure of the deal was decided earlier this month at a meeting attended by officials from Zimbabwe’s treasury, central bank, mines ministry, Afreximbank, and Great Dyke Investments chairwoman, Hespinah Rukato, the people said. The mine could produce about 800,000 ounces of platinum group metals a year if built.

Rukato declined to comment. Officials mines ministry said they couldn’t immediately comment. Mangudya declined to comment. DM


Please peer review 3 community comments before your comment can be posted