Fall in gold output a call to diversify economy

THE plunge in gold tonnage to seven tonnes in the first five months of the year from 9,2 tonnes in the comparative 2020 period should be a wake-up call for government. It means that Fidelity Printers and Refiners must start paying miners all their monies in foreign currency to incentivise gold deliveries, otherwise this is already showing.

We could also argue that if government offered more incentives such as reduced mining fees and levies, miners might be more inclined to deliver their gold through official means.

However, we believe that government’s obsession with mining must end. Since independence, the Zanu PF-led government has been obsessed with mining alone, neglecting other vital industries with potential to oil the country’s economy.

Maybe that is because pre-independence geological surveys and the one in 1990 lists Zimbabwe as having no fewer than 66 base and industrial mineral deposits.

Of these 66, to date, 40 are currently being exploited with a potential for this to increase owing to the recent discovery of minerals such as lithium and oil deposits.

However, one critical thing the government forgets is that in the 41 years since 1980, the global economy has become more diversified.

In fact, the World Economic Forum has stated that the earth is going under the Fourth Industrial Revolution, where technology is redefining how we live, interact and transact.

This is why government has to pay attention to the trends and move away from relying on mining because the country can afford to.

For example, an estimated 70% of the economy is informalised, begging the question: why isn’t government dedicating more funds to infrastructural development and create informal employment which increases consumer spending?

The country has a capacity to generate 1 872 megawatts in renewable energy, which coupled with traditional thermal energy generation, can give us the potential to export power. What is government doing to access that potential?

There are a lot of start-ups leaning towards ICT and technology in the country, yet government continues to spend very poorly in these sectors. Why doesn’t government make substantial investments in ICT and technology?

With a large population still unbanked, why can’t government adopt cryptocurrency usage and have alternative access to foreign currency? El Salvador recently adopted Bitcoin as legal tender owing to its large unbanked population.

There are so many avenues government could take to diversify the economy and this is important in case mining fails to deliver expected rewards because of the unpredictable headwinds.

Government must start thinking beyond gold or mining. The COVID-19 pandemic has drastically changed the limits of what is possible, and Zimbabwe must follow suit.