Zimbabwe gold output up 29 percent

by Nare Msupatsila

2012 July 16 19:00:59 | 1211 Views

Zimbabwe's gold production rose 29 percent to 7.2 tonnes in the first six months of this year, generating $377 million in revenue, data from the mining chamber showed on Monday.

The southern African nation's gold mining sector is recovering from an economic crisis that peaked in 2008 when hyperinflation reached 500 billion percent and forced most mines to shut.

Total gold production for 2011 was 13 tonnes. Output remains well below the 27 tonnes reached in 1999 before the decade-long economic slide.

This come at a time when stakeholders in the mining sector say Zimbabwe's gold industry needs US$2 billion in the next five years to operate at full capacity.

Submissions on the state of the gold mining sector by mining industrial representative bodies such as the Chamber of Mines, Zimbabwe Miners Federation, and Zimbabwe Gold Miners and Millers Association for consideration by the Ministry of Mines and Mining Development shows that the gold industry is currently operating at 44% owing to lack of capital.

The mining representative institutions however say the full recovery of the gold mining companies will depend on the mobilisation of US$2 billion in the next five years.

An investment analyst, Mr Edison Mutodzwa says the private sector mining players should work with government in raising capital.

"What is now needed is for government and the private sector to work together," said Mr Mutozdwa.

While official statistics show that gold generated US$627 million in 2011 export receipts, the commodity is this year being projected to earn at least US$1,2 billion from exports on the back of firming global mineral prices.

The gold sector has received US$350 million in short term loans between January and June this year out of more than US$1,8 billion total banking loans.

Canada-listed New Dawn Mining and Caledonia Mining, as well as the London-listed Mwana Africa and South Africa's Metallon Gold are among the gold producers in the country.

Gold

Source: Byo24News