Firming prices boost gold output

the same period last year, largely driven by continued firming of the international prices, latest data show.
There were also significant investments in the gold sector, which resulted in the reopening and recapitalisation of various mines.
Commodity analysts say the liberalisation of the gold market was a further positive.
Gold price rose 4,8 percent from US$1 356,5 per ounce in January to US$1 421 in March.
“Three key factors are at play – one being the liberalisation of the gold sector and firming of gold prices. Investment is also returning, with some major mining houses injecting money to expand production,” said one analyst.
The Chamber of Mines has forecast that gold output will reach 13 000kg this year and probably surpass its all-time high in 1999.
Gold output reached 29 000kg in 1999 but declined to an all-time low of 4 200kg in 2008 as a result of economic recession and mine closures.
The Chamber of Mines has projected that gold output would reach 50 000kg in the next five years if US$1 billion is invested into the sector.
Zimbabwe’s mining sector also expects mining to be the fastest-growing economic sector this year, owing to strong commodity prices and increasing investment in expansion programmes.
Currently, the mining sector accounts for 6 to 7 percent of the Gross Domestic Product.
The renewed activity at existing gold mines, contributions from recent diamond discoveries and increasing platinum output will fuel the sector’s growth.
This year, the mining sector is expected to grow by 33 percent ahead of other key economic sectors such as agriculture and manufacturing.
In his update on the state of the economy, Finance Minister Tendai Biti revised growth projections for agriculture to 19,3 percent due to a decline in maize and cotton output. A recent crop assessment has shown that maize output will be lower at 1,45 million tonnes compared with 1,5 million tonnes initially projected.
Cotton is now estimated at 220 000 tonnes compared with the 300 000 tonnes previously projected.
Tobacco is estimated at 200 million kg from the previously projected 50 million kg.
Average capacity utilisation will go beyond 50 percent as companies start accessing funds under the US$100 million Zimbabwe Economic and Trade Revival Fund. The sector is expected to grow by 6 percent.
Minister Biti, however, said the overall economic performance since the beginning of the year to date remains broadly within the macroeconomic framework projections and targets as set out in the 2011 National Budget.