A boon for economy as gold prices rise

Sunday Mail Reporter

THE new punitive tariffs announced by United States President Donald Trump last week, which have raised the spectre of a global tariff war, are driving gold prices to record highs, a development that is expected to benefit Zimbabwe, as the mineral is a major foreign currency earner.

Gold prices rose to a historic high of US$3 167.84 per ounce on Thursday, mainly driven by aggressive US tariff policies.

The precious metal, which is used as a hedge against global political and financial instabilities, has surged more than 19 percent year-to-date, which presents prospects for significant earnings for Zimbabwe.

Latest Reserve Bank of Zimbabwe (RBZ) statistics show that the country’s gold export earnings increased by 8,6 percent in the first two months of 2025 to US$240,1 million, representing a marked increase from the US$221 million realised during the corresponding period last year.

Gold remains Zimbabwe’s single largest export commodity. Mines and Mining Development Deputy Minister Polite Kambamura told The Sunday Mail that because of developments on the global market, Zimbabwe was now primed to start receiving increased foreign currency from gold exports.

“The country is now benefitting from increased foreign currency receipts which are coming from the export of the same volume of (gold) we were producing,” he said. The Government, he said, was moving to ensure increased gold production from the country’s mines.

“We are working with mining companies and encouraging them to expand their production. Traditionally, they were not mining the low-grade ores because they were saying they have less value, but we are saying now is the time to even mine the low-grade ores as well so that we benefit. As a country, we need not miss this window and, as Government, we continue to benefit from the increased value,” he said.

Economist Mr Persistence Gwanyanya said Zimbabwe’s economy was set for further economic growth and continued stability of the Zimbabwe Gold (ZiG) currency, especially on the back of the latest increases in gold prices.

“Gold has always benefitted from chaos in the global economy and what is happening in terms of the Trump tariffs is that there will be retaliations, and they are not good for the global economy because they have the potential to drive inflation,” he said.

“Normally, as the US dollar takes a dive, investors seek safe haven in gold and so far, the gold price has breached the US$3 000 mark, and we see it increasing from there.

“The positive for Zimbabwe is that when global gold prices firm, we see significance benefits for the country . . . Zimbabwe is a bullion economy, so the revenues from gold are going to increase.” If gold prices continue on the current trajectory, Mr Gwanyanya said, Zimbabwe could see further economic growth than previously envisaged.

“Thus, the bullish gold market is supporting the Zimbabwean economy in a big way . . . so, as gold production increases, we expect royalties by the Government to also increase . . .”

A significant portion of Zimbabwe’s gold is produced by small-scale and artisanal miners, who collectively account for approximately 65 percent of the country’s total gold output, underscoring the importance of the miners in the national gold value chain and the country’s economy.

Zimbabwe’s gold industry has seen strong growth in recent years, largely driven by various Government interventions, supportive policy and industry initiatives.