RBZ denies RioZim debt

The reserve Bank of Zimbabwe (RBZ) has filed a High Court application denying a debt worth over $92 million allegedly owed to RioZim.

This comes after RioZim sued the central bank for breaching provision of the exchange control of directives whereby the mining company is supposed to be given access to utilise the foreign currency it generated externally.

Gold and platinum mines are legally required to sell their produce to Fidelity Printers, an arm of the RBZ which then exports the mineral.
Government last year said it will now allow gold and platinum mining companies to retain up to 55 percent of their earnings in United States dollars while the balance is transferred to their local accounts via electronic transfers.
The mining company was allegedly supposed to receive $84 297 364 in hard foreign currency, which amounted to 50 percent of its export proceeds.
However, through its lawyer Frank Rudolph RioZim alleged that it has only received $26 130 967 which constituted 15 percent of the amount due since 2016.
Representing the central bank and Fidelity Printers, lawyers Gerald Mlotshwa and Wellington Magaya respectively, have denied the debt saying all payments were made by bank transfer in USD.
“The alleged breach is denied. The exchange control directive did not impose any legal duty on Fidelity Printers. It did not impose any terms in the sale of agreements between RioZim and Fidelity Printers.
“Fidelity Printers insists that its relationship with RioZim is that of buyer and seller. All sales to Fidelity Printers were paid for. RioZim is not entitled to any proceeds from the export of gold. This is why it does not even know how much gold was exported and how much was released,” the papers read.
The RBZ has argued that the mining company’s plea is malicious and driven by ulterior motives.
The lawyers on the other hand have argued that Fidelity Printers performed its side of the agreement and paid RioZim for all gold delivered during the relevant period and had no obligation to pay funds into the mining company’s account.
“The correct position is that payment was made as per the agreement between the parties and in terms of the law. All payments were accepted and acceptance of payment marks the end of the relationship between RioZim and Fidelity Printers in respect of each transaction.”
In its lawsuit, RioZim had mentioned that it was “facing severe challenges arising from the company’s inability to access its foreign currency earnings that are required to fund its operations and sustain its growth.”
However, RBZ dismissed claims that RioZim is suffering and has challenged the mining company to prove that it was entitled to hard currency at the time its demand was made.

 

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