Foreign business encouraged to invest in Zimbabwe mining

Zimbabwean President Robert Mugabe on Wednesday appealed to foreign investors to seize opportunities in the country's mining sector assuring them that the unity government was on track.

Mugabe told 850 foreign investors attending a two-day mining conference in the capital Harare that the inclusive government programme formed in February with his rival, Prime Minister Morgan Tsvangirai, had made progress.

"The inclusive government has registered satisfactory progress thus far as ensuring a stable and conducive political environment... in which the mining sector significantly contributes to the gross domestic product, national employment and foreign exchange earnings," Mugabe told the investors.

Zimbabwe's mines minister Obert Mpofu also pushed for investing in the sector.

"We need regional and international support from you. We will do everything in our power to accommodate your investments," he said.

However, Murowa Diamonds managing director Niels Kristensen in an address said mixed messages from the government were a concern to potential investors.

"At this moment we have a lot of inconsistent statements from government, until that is addressed we will not have significant investment in Zimbabwe," said Kristensen.

"Uncertainty will be the biggest impediment to investment to Zimbabwe. There are good intentions being made but that needs to be turned into reality," he added.

Despite its potential, mining has been constrained by problems such as erratic power supply, skills shortages, failure to access foreign currency and shortages of spare parts such as drill bits.

Mining accounts for 3.8 percent of Zimbabwe's GDP, about 4.5 percent of employment and a third of total foreign exchange earnings based on 2007-2008 output.

Mugabe said the government was "committed to ensuring that the policy environment is stable, predictable and sufficiently attractive to guarantee investors good returns on their investment."