Online Reporter
SMALL-SCALE and large gold miners delivered a record 5,11 tonnes of gold to Fidelity Gold Refinery last month, around a sixth of the total deliveries this year, with Zimbabwean production now expected to exceed the target of 50 tonnes this year by an extra 5 tonnes.
While major mines have been making steady progress in increasing output, investing in new equipment and reopening closed shafts, the small-scale sector has been racing ahead and in recent months has been responsible for more than three quarters of all deliveries.
A fair block of this rise in small-scale production, totalling almost 4 tonnes last month, is the result of a series of measures by the Government to improve both support and regulation of the smaller-scale miners. While effectively banning most of the abuses of artisanal miners, such as tunnelling under roads and buildings and mining in river beds and along river banks, the Government has also been innovative in building up the licensing system to give small miners far greater security. They also pay lower royalties.
By treating them decently and respecting their role in supporting their families and building the nation, while demanding law-abiding behaviour and adherence to the law in return, the small-scale miners are being rapidly integrated into the more formal economy rather than rampaging around the edges. The result is that they are concentrating on mining gold, rather than playing cat and mouse with law enforcement and befriending organised crime.
This sort of approach of step-by-step formalisation, a mainstay of the Second Republic’s policy in gold mining, shows the route that other formalisation drives need to follow. Practical policies in small-scale agriculture and small-scale gold mining have been lifting hundreds of thousands of families and millions of people out of abject poverty and allowing them to progress to that middle-income life that our Vision 2030 demands.
When most of our people are included in the ranks of the middle income population or better, then Zimbabwe will be an upper middle income country and, even more importantly, be one that includes the vast majority in the growing prosperity. The non-inclusive colonial approach of concentrating wealth in a small percentage simply created a poor country with a thin richer crust.
Besides the build-up in output it has been made a lot easier for the smaller miners to deliver their gold to Fidelity and its agents, with prompt payment guaranteed. The old rampant black marketing and smuggling of artisanal gold has as a result been largely eliminated. So all our gold now moves through official channels and appears in the official reserves and export earnings, so strengthening the economy and the currency.
Gold has been the major export of Zimbabwe for several centuries, deep into the pre-colonial period. The wealth from gold was critical in building the societies that were able to create Great Zimbabwe and other major centres. Attempts by the Portuguese in the 17th century and more successful efforts by the British South Africa Company at the end of the 19th century to conquer and control the gold production and trade were both ultimately unsuccessful.
Zimbabwe has always been willing to sell its gold, and take part in international trade and use gold earnings to buy essential imports. That is the position over the centuries in both pre-colonial and independent Zimbabwe. But the stress is on global markets buying the gold at recognised prices, not on stealing the gold and trying to reduce Zimbabweans to serfdom to mine the metal.
So the US$4,61 billion that gold exports earned last year, and the US$3,1 billion in just the first half of this year, mean that we, as a nation, are earning our way to prosperity by the hard work of our many miners, backed by pro-business Government policies. Those sort of exports, along with the growing earnings from other minerals, tobacco and horticulture, and now some manufactured products, have ensured over the past 12 months our first positive trade surpluses for many years.
Gold might still be the major export, and gold exports are growing, but as a percentage of our total exports, other commodities and products are now assuming ever larger importance. This means we can be very happy about the rising gold earnings while at the same time being moderately less dependent on gold to fuel our economy. We must never again be at the mercy of world markets with just a couple of products, but rather be continually increasing the breadth of our exports.
One important aspect of the gold production and exports is that by the time the gold leaves our borders, it is fully refined, not a concentrate or an ore. There are only a few world refineries recognised to produce the final guaranteed banker bars, but those when they buy Zimbabwean gold know they are buying a refined product and so just add the small hallmarking fee.
As the rest of our mineral exports are fully processed locally into the final form suitable for global trade they too will be earning the full price and earning the sort of revenue that gold is already earning. Gold will still be a growing and major export, but there could be growing competition at the top of the export table.
