'Hike gold buying price'

HARARE - Small-scale gold miners have challenged the Reserve Bank of Zimbabwe to review its depressed gold buying price saying it has spawned a thriving black market.

Opening the relaunch of the Gold Miners Association of Zimbabwe (GMAZ) in the capital, Harare, Irvin Chinyenze, GMAZ chairman said Fidelity Printers and Refineries (Fidelity) — a gold buying unit of the central bank -— must review its pricing regime.

“The reason why miners are not taking their gold to Fidelity is because their tax regime is not viable,” Chinyenze said. “We challenge the Reserve Bank of Zimbabwe to have a re-look at the taxes and charges so that they become reasonable.

“I say this because smuggling and the black market are an ugly reality that should be eliminated and the only way this can be done is through reasonable pricing and taxing from the central bank.”

This comes as President Robert Mugabe told the Zanu PF conference last weekend that all small- scale miners should sell their gold through the central bank.

“Makorokoza (small scale miners) should take their gold to the Reserve Bank, zveblack market vombomira (they should desist from using the black market),” Mugabe said. “It is killing the economy.”

A research conducted by the Centre for Natural Resource Governance (CNRG) observed that Fidelity was buying gold at $32 per gram, while on the informal market a gram of gold is fetching $39 in Kadoma and $42 in Harare.

The yellow metal is one of the top foreign currency earners owing to firming international prices and increasing production, with small-scale gold miners accounting for 65 percent of the total national production in the first six months of the year.

According to the report, the price offered by Fidelity was 76 percent of the global market price.

The report also said Fidelity needs to recapitalise in order for it to offer competitive prices that would kill the black market.

The recapitalisation of Fidelity Refineries requires $50 million to enable it to refine all the gold that was mined and produced in Zimbabwe before it is exported.

The small-scale miners called for policy consistency by the newly elected Zanu PF government.

“Depending on which angle you’re from, the election results have led to a wait-and-see attitude by the investors who are waiting for policy pronouncement.

“It is up to government to work on its policies and attract investors,” Chinyenze said.

Comments (1)

Vakuru ava vachembera, kana nyaya dzacho dzavekuenda musango. Ngenyi vasikazikutaura ngenyaya yemari yengoda inove yakawanda kupinda yegoridhe? If he is serious about the economy he should understand what accountability means and apply the law non selectively.

Chitoto Zvangu - 17 December 2013

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