New Zimbabwe.com

Government rues lost opportunities through gold leakages

By Staff Reporter

GOVERNMENT believes gold output could have earned the country more than the nearly US$1 billion dollars realised from the yellow metal last year had it not been for massive sector leakages.

Mines Ministry Permanent Secretary Munesuishe Munodawafa told small scale miners at a Minex Indaba in Kwekwe recently that flaws within the system have cost the country in terms of potential revenue as much of the precious mineral produced locally is spirited away to external markets.

The Mines Ministry admits this has cost the country in terms of revenue as most of the gold being mined locally is unaccounted for.

Munodawafa described as unpatriotic, those who mine for gold inside Zimbabwean soils but fail to deliver the mineral to Fidelity Printers and Refiners, government’s procuring agent.

“Gold is the major foreign currency earner in Zimbabwe, contributing $977 million in 2017 which translates to 39% of total national exports,” he said.

Munodawafa however said the sector was failing to realise its full potential in the country.

“The gold sub-sector has great potential considering the amount of gold which is unaccounted for and goes into the illegal market,” he said.

“If all players in the subsector become responsible and patriotic citizens delivering all gold to Fidelity Printers and Refineries, I can assure you that this country will not remain the same,” he said.

According to government statistics, small scale miners are surpassing primary producers of gold.

Of the $977 million contributed to Treasury last year, small scale miners contributed more than 50% of the figure.

“The contribution of small scale mining to our economy cannot be overemphasized,” he said.

He added, “Production of the small-scale miners, especially gold, has been rising significantly since 2014, increasing from 3 727 kg to a whopping 13 176 kg in 2017. Definitely with such performance, small scale miners cannot be ignored.”

Government, through the Central Bank and its subsidiary Fidelity Printers and Refiners, as a way of capacitating small-scale miners, in 2017 launched the Gold Development Fund which was financed to the tune of $40 million.

The fund was increased to $150 million in order to cater for the high demand.

In his address, Munosawafa also called for the diversification of the small-scale mining sector.

“Zimbabwe’s small-scale mining sector is concentrated in gold, chrome and semi-precious stones, and this calls for more diversification in order to increase the number of the mineral commodities that this sector can benefit from,” he said.