Online Reporter
Nqobile Bhebhe [email protected]
GOVERNMENT has allayed fears of possible disruptions to Zimbabwe’s gold exports in the wake of tensions involving the United States and Israel against Iran, saying there is no need for panic as no red flags have been raised regarding the country’s access to key markets.
Responding to questions from legislators in the National Assembly this week, Deputy Minister of Finance, Economic Development and Investment Promotion, David Mnangagwa, said authorities were closely monitoring developments but current indicators show that gold trade flows remain stable.
“We have not received any red flags or concerns from Fidelity Printers and Refineries, which is the sole agent that sells our gold, that would warrant any policy intervention. It is an issue that all agencies are consistently and constantly keeping an eye on. Right now, no measures have been found to be needed for our trade of gold. We still see a smooth flow. When that happens, I am sure the agency, that is Fidelity, has other markets to buy, not only trading of gold. Gold is a commodity that is desired globally.”
Deputy Minister Mnangagwa said Zimbabwe’s gold exports are not solely dependent on the Middle East market, noting that global demand for the precious metal remains strong.
“So, I am sure we would not face any challenges if this continues. Gold as a commodity is facing demand globally, not just in the UAE, which is traditionally where we were exporting to. If there is a need to reroute our bullion to other markets, there is huge demand for gold globally. So, I do not believe that we will face any challenges with selling the gold that we produce as a country,” he said.
Gold remains Zimbabwe’s largest foreign currency earner, making stability in the sector critical to the broader economy.
The Government, through Fidelity Printers and Refineries, plays a central role in gold buying, refining and marketing.
Responding to questions on whether private players can participate in gold refining under the current legal framework, Deputy Minister Mnangagwa said the Government retains tight control over the sector through licensing provisions.
“The Minister of Finance is the one that reserves the right to give a licence for refining and that licence was given solely to Fidelity, to have the monopoly and if any other players are to enter the market as they need to diversify, it will be through the Minister of Finance, making sure that the State remains a player in terms of consolidating all the gold in the country.”
On progress towards rejoining the London Bullion Market (LBM) as part of efforts to maximise earnings and diversify export markets, the Deputy Minister said Government remains flexible and guided by value considerations.
“The UAE as a destination was the one that was offering us, I guess the best value, but all alternatives are always open and where we can get the best price for our gold is where Government will endeavour to make sure that we have the best relations and engagements.
“So, when it comes to this trade of gold, that Fidelity is concerned about is making sure that we get the best price for our gold and that we give the best price to our miners. The arena of gold trading is vast and has widened so much that it extends beyond just the London Bullion Market, but if there are engagements that are going on and the LBM is offering good prices, I am sure Fidelity has the responsibility of making sure that we get back and join the LBM.”
