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Sikhulekelani Moyo, Business Reporter
AS Treasury prepares to deliver the 2022 national budget next week, Fidelity Printers and Refiners (FPR) has urged the Government to avail more resources to capacitate players in the gold mining sector.
The sole gold buying unit runs the Gold Development Initiative Funding (GDIF), which assists in developing capacity of gold producers in the country. The facility was created by the Reserve Bank of Zimbabwe (RBZ) as part of initiatives to enhance economic productivity through promotion and development of the gold mining industry in Zimbabwe.
In a latest report to the Portfolio Committee of Mines and Mining Development, FPR said enhanced fiscal support measures would boost gold output and widen earnings for the economy.
It, however, raised concern that funding was not adequate, for both artisanal miners and large-scale producers.
“The GDIF seeks consideration for allocation of funding under the 2022 national budget through the assistance of the Portfolio Committee of Mines and Mining Development,” the report reads.
“As at end of October 2021, the GDIF had an outstanding funding pipeline consisting of proposed transactions amounting to just above US$20 million.
“This amount is a fraction of the aggregate gold industry funding demand, which is currently standing at US$1 billion annually for the next five years (Zimbabwe Chamber of Mines, 2019).”
According to FPR, the total funding requirement for the sector is US$50 million for the year 2022 alone, which will be allocated to different shareholders.
“Artisanal miners, small-scale miners and gold value chain players will get US$20 million and an approximate of 150 miners are expected to benefit from this funding, medium and large-scale miners to get US$30 million,” it said.
FPR said the allocation of the funding would help the GDIF to mitigate the effect of illegal sanctions imposed on the country, which continue to hinder the flow of capital into the mining sector.
“GDIF will help reduce youth unemployment through creation of jobs within the gold value chain, creating a bedrock for the devolution agenda, which is dependent on each region becoming self-sufficient through utilisation of natural resources of which gold is key,” it said.
“Closing the skills gap through advisory/extension services to gold miners and ensure safety health, environment and quality (SHEQ) standards are adhered to, thus helping to curb mining related accidents, which have been prevalent on artisanal and small-scale workings.”
Improved capacity support is also expected to increase export earnings through increased production and export of gold and formalisation of artisanal and small-scale operations.
This will help increase the country’s tax base and ramp up tax collection and promote ease of doing business within the gold sector, said FPR.
“GDIF will provide development finance solutions to the gold mining sector (banker and empowerment tool for gold miners), enhance gold production, productivity and deliveries to Fidelity Gold Refinery, increase gold export value and foreign exchange for Zimbabwe, enhance socio-economic development, drive formalisation of the artisanal and small-scale gold miners, employment creation, rural economic development and poverty alleviation, and financial inclusion in the gold sector,” it said.
Meanwhile, FPR has this year distributed $1,7 billion from the GDIF meant to assist miners to improve production. – @Sikhulekelanim1
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