Latest News Editor's Choice

News / National

Gold deliveries slump

by Staff reporter
19 Aug 2021 at 15:35hrs | Views
Fidelity Printers and Refiners (FPR) is worried about the decline in gold deliveries over the years owing to a number of factors and the firm is working on a cocktail of measures to address the challenges, legislators heard recently.

FPR acting general manager, Mr Peter Magaramombe, said the decline had the effect of Government's desire to mobilise foreign currency.
Mr Magaramombe was giving oral evidence before Parliament's portfolio committee on Mines and Mining Development.

The committee, chaired by Shurugwi South MP Cde Edmund Mkaratigwa (Zanu-PF) wanted to know what the organisation was doing to curb gold leakages, which has also contributed to a plunge in gold deliveries.

In his evidence, Mr Magaramombe said they had introduced a number of measures.

"We are not happy at all with the decline in gold deliveries," he said. "Why? Because at the end of the day we will not be able to generate as much foreign currency that we need in the country.

"In order to ensure that we get as much gold as possible there are some measures we have put in place, like for example we have introduced export incentives that will encourage our miners to deliver gold as much as possible.

"Like we are saying for every gold, in terms of the incremental gold delivered to Fidelity, there has been some revision of threshold in terms of retention of foreign currency. We have moved from 60 to 80 percent retention to try to encourage our miners bring more gold."

Fidelity Printers and Refiners head of gold operations, Mr Mehluleli Dube said they were also cautious in issuing gold buying licences to deal with unscrupulous buyers who might be in the business for speculative reasons.

He said the length of a licence would be determined by the frequency they deliver gold to Fidelity Printers and Refiners, including those who need the yellow metal to produce jewellery.

"We have revised issuing licence in terms of their deliveries," said Mr Magaramombe. "Licences are now issued for a short period of time, say for a month and when you don't deliver consistently and when it expires we will not renew it."

Mberengwa North MP Cde Tafanana Zhou (Zanu-PF) said it was prudent to publicise names of those dealers whose buying licences would have been revoked so that they would not continue buying gold.

It was also noted that Covid-19 national lockdown and restrictions had an impact on gold deliveries.

"Covid-19 pandemic has affected gold production in the country, there was also restrictions of movement of flights," said Cde Mkaratigwa.

"Heavy rains have also hampered efforts to produce more gold, those were the major issues that affected our production levels."

The mining industry is the country's largest foreign currency earner, accounting for about 65 percent of exports and is one of the key sectors designated for short to medium term economic revival.

Chiredzi North MP Cde Roy Bhila (Zanu-PF) implored FPR to ensure that gold was delivered using the formal system so that the country achieved the US$12 billion economy by 2025.

"We need an overall picture of how gold is distributed to ensure that it moves with the correct channels," he said.

Source - the herald