. . . Govt readies for comprehensive review of the Gold Trade Act
HARARE – Gold earnings increased 25% in October to US$86.5 million from US$60.19 million the previous month as both delivered volumes and international prices firmed.
According to data from the Reserve Bank of Zimbabwe, gold earnings increased in October but fell 17.39% from US$104.70 million earned in October last year. As previously reported (https://mailchi.mp/fxzim.co.zw/gold-deliveries-fall-43-y-o-y-as-small-scale-miners-continue-to-falter-1249649?e=4c38493f9c ), gold deliveries showed a marginal increase 0.42% although they fell 43.06% year on year. The average price of gold on the global market improved to US$1 881.5 per ounce in October from US$1 839.71. As of November 26, the current price of Gold is $1803.70.
Cumulatively, gold shipments fell by 23.13% to US$697 million in 2020 from US$906.7 million in the same period last year.
Gold sector has been rocked by smuggling problems, amid late payment for deliveries by the Fidelity Printers & Refinery. The sole buyer of gold in Zimbabwe is taking as long as two weeks in order to pay for gold delivered to them. This has seen gold deliveries to the regulator plummeting especially from small scale miners who are selling to smugglers at a discounted price. The RBZ says that it imports US$60 million in cash monthly to pay gold miners.
According to the statistics, gold shipped in September 2020 was 45.77% lower than the same month last year. Value of the gold shipped in September 2019 was US$127.6 million, and was US$58.4 million more than the US$69.2 million shipped in the same month this year.
In the two months of September and October gold worth US$155.7 million was shipped, which was 32.89% lower than the US$232 million shipped in the same period last year.
The gold industry accounts for more than 30% of mineral exports and employs around 32% of total formal mining employment while more than 500 000 are engaged in artisanal and small-scale gold mining.
Government is set to announce policy interventions in the Ministry of Mines and Mining Development with respect to two minerals, one of which is gold, as the country aims to attain the US$12 billion export revenue in that sector. In the National Development Strategy (1), Finance Minister Mthuli Ncube said that weak governance in the sector has been the major limiting factor. Government would therefore undertake a comprehensive review of the Gold Trade Act amid other policy interventions.
During the NDS1 gold bullion deliveries to FPR by small scale miners will be increased to 24 tonnes from 15 tonnes by 2025. The NDS also proposes the establishment of a gold reserve fund as a vehicle to mobilise finance. This will be complemented by setting up of a minerals commodities exchange, which will trade all other minerals, except for gold. – Financial Express