CASH PAYOUTS
Dr Mangudya commits cash to miners
GOVERNMENT believes small-scale gold miners can deliver more than 10 tonnes of gold as the sector angles to breach the set target of 28 tonnes for 2017. It is understood that a record gold haul, which eclipses the 27 tonnes realised in 2009, will force Government to consider scraping royalties for the sector.
Last week, the Minister of Mines and Mining Development, Mr Walter Chidhakwa, told The Sunday Mail Business that further incentives can help spur deliveries from artisanal miners.
“The surge in gold production is a direct result of increased gold deliveries by the small-scale sector, which contributed 7,5 tonnes in 2015 from 3,9 tonnes in 2014, representing 40 percent of the gold deliveries.
“In 2016, gold deliveries from smallscale producers increased to 9,7 tonnes and we hope to receive over 10 tonnes in 2017 due to the improved operating environment for (the) small-scale sector.
“I would like to seriously pose a challenge to the gold sector, that if we are able to meet 28 tonnes by December 2017, I propose to remove royalties for gold which currently stand at one percent for small scale and three percent for the large producers,” said Minister Chidhakwa.
It is envisaged that scrapping royalties and increasing gold buying agents will help increase both production and deliveries.
In 2016, gold deliveries at 23 tonnes, which earned the country US$914 million, were one tonne shy of deliveries made a year earlier.
Fidelity Printers and Refiners (FPR), a unit of the Reserve Bank of Zimbabwe (RBZ), has since bought six cars meant for mobile gold buying units in remote areas such as Mudzi and Mutawatawa in Mashonaland East province.
Whilst FPR used to consider transactions involving more than five grammes of gold, it has since scrapped the minimum requirements in order to augment supplies. Miners are also being paid in cash. On January 20 this year, the RBZ Governor Dr John Mangudya said the central bank has allocated US$5 million in cash for the sole purpose of buying gold.
“This cash is provided from the revolving gold sales. Fidelity shall also encourage established small-scale miners to open bank accounts which will serve as a performance track record for capacitation initiatives,” said Dr Mangudya.
Gold production hit an all-time low of 3,6 tonnes in 1999, weighed by foreign currency shortages and power outages. It has been progressively rising since then.