Chronicle Editor
Government has availed US$10 million to boost gold production as it pushes to achieve a US$12 billion a year mining industry by the end of this year. Finance and Economic Development Minister Professor Mthuli Ncube said the US$10 million gold fund is targeting small-scale and artisanal miners.
Speaking at the launch of the fund on Wednesday, Prof Ncube said half of the fund will go towards loans and the other half will fund the establishment of more gold processing and buying centres.
Artisanal and small-scale miners contribute over half of the gold sold to Fidelity Printers. Last year the sector produced 23,3 tonnes of the 35 tonnes delivered to Fidelity Printers. This year Government is targeting over 50 tonnes of gold hence is supporting the artisanal and small-scale miners to boost production.
The gold fund is meant to provide working capital to the miners as well as fund establishment of more gold centres so that the centres are close to the miners. Minister Ncube said the Zimbabwe Mining Development Corporation (ZMDC) will build the gold centres while BancABC will disburse the loan fund. He said the mining sector was the country’s largest foreign currency earner and had the potential to contribute more and create more jobs if provided with the required resources.
“The gold facility has the potential to close the funding gap and boost productivity as well as finance bankable projects with a focus on value addition,” said Minister Ncube.
He said such strategic deployment of resources will ensure that Zimbabwe’s Vision 2030 remains on course. Prof Ncube said the fund will be accessed through the Mining Fund which is administered by the Ministry of Mines and Mining Development. “This is a revolving fund and as such Government expects beneficiaries to repay the loans to enable others to also benefit. The Ministry of Mines and Mining Development and BancABC will work closely to ensure viability and sustainability of this fund through efficient allocation and recovery programmes,” said Minister Ncube.
The payback period for the loans will range from six months to a maximum of six years. We want at this juncture to implore Government to ensure mechanisms are put in place to guard against abuse of the fund as well as ensuring the beneficiaries payback the loans.
The defaulting rates on such facilities in the past have been alarming and it is our fervent hope that Government learnt from past experience and will ensure this time around the facility is used for its intended purpose which is to boost gold production.
BancABC and the Ministry of Mines and Mining Development should not just disburse the loans but should also make a follow up to ensure the beneficiaries use the money to boost production so that they are able to payback the loans.
The Government initiative to boost gold production is coming at a time when the country is enjoying increased production of lithium across the country.
Zimbabwe is in fact fast consolidating its position as the leading lithium producing country in the region and beyond.
Many Lithium mining projects are taking shape across the country and very soon the country will be among the leading producers of lithium which is the mineral of the moment due to production of electric cars.
The fast growth being recorded in the mining sector is a confirmation that the target of US$12 billion a year mining industry by the end of this year is achievable.
Online Reporter
Bongani Ndlovu