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Kudzanai Gerede : Business Correspondent
Small scale and artisanal miners are set for a major boost following Government’s sourcing of a US$ 20 million gold development initiative facility through the Reserve Bank of Zimbabwe subsidiary, Fidelity Printers and Refiners to support small mining operations.
Small scale miners have demonstrated huge potential of turning around the fortunes of the gold sub-sector with significant deliveries recorded in recent years which have prompted authorities to decriminalise their activities and offer support to avert the scourge of selling the commodity on the black market.
Gold deliveries to Fidelity Printers and Refineries have been on an upward trend since 2010 and more evident during the past two years following Government support to artisanal miners which have boosted production.
In his recent monetary policy statement, Dr Mangudya said the country’s gold composition is underexploited and the Bank was bent on ensuring production levels were heightened through continued support to the small miners.
“With underground gold reserves estimated to be around 13 million tones, Zimbabwe’s rich gold reserves are underexploited.
“Only 586 tonnes have been officially mined over the past 36 years from 1980 to August 2016. There is therefore great scope to vigorously promote the mining of gold across the country in order to liquefy the economy,” he said.
Analysts say the continued support by the Central Bank in injecting capital for mechanization of artisanal operations is likely to see gold production exceed peak levels of 30 232.62 kilograms per annum reached in 1999 within a few years and this is further encouraged by a steady recovery in commodity prices.
RBZ figures show that first half to June gold deliveries surged by 18 percent in 2016 to 9.6 tonnes compared to 8.1 tonnes realised same period in 2015 including a further 1.1 ton processed from Platinum Group Metals this year. The reduction in royalties from 5 percent to 3 percent on incremental output with a cap of five percent for large scale primary producers and from 3 percent to 1 percent from small scale and artisanal miners coupled with firming of international gold prices from an average of US$ 1 181.21 per ounce in the first quarter to about US$ 1 259.35 per ounce during the second quarter, has been largely attributed to an increase in local production of gold.
“The US$ 20 million facility is really a lot of money that is going to help the small scale and artisanal miners and this money is actually even going to be handy in setting up of service centres. The challenge might be that, given the number of artisanal miners its quite difficult to cater for everyone because numbers are growing as employment opportunities are thinning,” said Zimbabwe Miners Federation chief executive officer Mr Wellington Takavarasha in a telephone interview.
He said they had engaged Government on the reduction of milling fees which were still too high for most of the small scale miners and was derailing efforts to improve deliveries through normal channels.
“We have approached Government on the high cost of doing business and we expect a further reduction on the current fees because most miners end up selling their gold on the black market or smuggling gold out of the country,” he said.
This was also echoed by Dr Mangudya highlighting a decrease in the number of registered millers owing to high custom fees from 485 millers when the fee was at US$ 2 000 to the current registered 51 millers following an increment in the fee to US$ 8 000.
The Governor also highlighted the need to reduce exploration licenses, claims and related charges, environmental impact assessment fees and rural district council fees to ease the cost of doing business for local miners.
However gold production for 2016 is expected to reach 24 000 kilograms buoyed by small scale and artisanal miners production.
Online Reporter