Presenting the 2011 national budget to Parliament last Thursday, Biti said the continued impasse on SMM has hit the construction industry hard. The government seized the asbestos mine firm in 2004 from business tycoon Mutumwa Mawere accusing him of defrauding the state. Mawere bought the mine from a British firm in 1997.
“Mr Speaker Sir, production of asbestos at Shabanie and Mashaba Mines continues to decline, falling significantly from 8,480 tons realized in 2009 to an estimated 2,000 tons in 2010, this against a background of never ending legal processes that have exacerbated viability challenges associated with severe shortages of working capital, resulting in cessation of mining operations and mine closure,” Biti told the House of Assembly in reference to three appeals before the High and Supreme Courts lodged by Mawere.
“The ripple effects of the closure of Shabanie Mine are being felt throughout the construction industry. Surely leadership is urged to resolve the current disastrous impasse,” the Finance Minister said. SMM closed last month, laying off 1600 workers and only retaining a staff compliment of 72 artisans tasked with draining the flooding asbestos mine. Last week Mawere appeared before a Parliamentary Portfolio Committee on Mines and Energy to explain how government had used the Reconstruction of State-Indebted Insolvent Companies Act to takeover his SMM company amid spirited resistance from Justice Minister Patrick Chinamasa.
Chinamasa played a key role in expropriating Mawere’s assets. Parliament is set to hear evidence from Chinamasa before coming up with a decision, but Chinamasa has been booed in Parliament for attempting to block the handover of Mawere’s assets.Post published in: Manufacturing