Economy blow as 3rd biggest gold producer stops operations; 2,000 workers left in limbo

Spread This News

By Kwekwe Correspondent

THE JOBS of more than 2,000 RioZim employees were left hanging in the balance Wednesday after gold producer suspended operations at three of its mines.

The company blamed foreign currency shortages for the development and has since indicated it is considering legal action against the Reserve Bank of Zimbabwe (RBZ).

RioZim accuses the central bank of not releasing the foreign currency the company earns from gold deliveries.

The RBZ has not yet responded the company’s charges.

It was confirmed Wednesday that operations had been stopped halt at Kadoma’s Cam and Motor Mine, Dalny and Renco Mine in Masvingo.

Sources told that the fate of the employees is hanging by the balance with the company have already been struggling to pay wages.

“Currently, there is no production at on the ground. We have not been working for quite a while.” said an employee.

“We heard that the company has not been getting their share of foreign currency from RBZ which is making it difficult for the company to fund operations.

“There is no cyanide for ore processing and, consequently, the situation has affected our subsidiaries which are Cam and Motor Mine, Dalny and Renco Mine.”

Salary payment problems

It has been gathered that the company has for some time been struggling to pay salaries.

“The company has been struggling to pay workers their salaries. We understand they only received 40% of their salaries for September,” sources claimed.

RioZim General Manager Tendai Kudyamasumha referred all questions to the company’s corporate affairs department which had not responded by the time of publication.

Last month the company recently issued a statement threatening legal action against the central bank.

“The company is currently facing severe challenges arising from the company’s inability to access its foreign currency earnings that are required to fund its operations and sustain its growth,” said he gold miner.

“Consequently the company’s costs have escalated as the price of locally available consumables and spares has increased exponentially when compared to the prices quoted by external suppliers for the same products.

“In some cases, the prices quoted by local suppliers is more than 300% the price quoted by their international counterparts.

“The situation is thus unsustainable and prohibiting the company’s ability to operate.”