Reserve Bank of Zimbabwe (RBZ) governor Gideon Gono yesterday gave the country’s top platinum miner, Zimplats, a 24-hour ultimatum to comply with a directive compelling mining companies to bank locally or face closure.
The central bank chief also threatened to freeze the company’s local account whose balance he said was being channelled offshore in violation of a new RBZ directive.
This means the Impala Platinum-owned company is expected to bank locally with effect from tomorrow since today is a public holiday.
In March, Cabinet resolved to compel all mining companies to bank locally following indications that hundreds of millions of dollars were trapped offshore.
Presenting oral evidence before the Parliamentary Portfolio Committee on Small to Medium Enterprises, Gono said he had met a local bank, which is understood to be handling the platinum miner’s transient deposits, to instruct Zimplats to bank locally.
Gono told NewsDay on the sidelines of the meeting that Zimplats was defying the directive, arguing that a predecessor to the mining company had made an agreement with government in 1994 to bank offshore.
“This morning before I came to the meeting (at Parliament), I had a running battle with one of the companies that continuously sought to defy the central bank’s directive to bank onshore,” he said.
“They will be coming to you (MPs) and say the governor is now insane, he is now disrupting our operations,” said Gono.
“We will not have any company operating in this country—a mine or any company for that matter defy the central bank and the laws that we were given to administer by distinguished honourable members (of Parliament).
“This company is Zimplats. I have ordered that if they don’t comply within the next 24 hours, their operations will be shut.”
Gono said mining exports accounted for 60% of the country’s foreign currency receipts revenues of which between 25-30% is derived from Zimplats.
“If one such company defies the law, everyone else will defy,” he said. “The bank concerned was making appeals on behalf of Zimplats to allow them to keep the money outside and I have said no to that.”
Mines and Mining Development minister Obert Mpofu recently said all mining firms that had deposited money earned from the sale of local minerals in offshore accounts were expected to repatriate the funds to Zimbabwe.
Some foreign-owned banks operating in the country are understood to be holding millions of dollars in nostro accounts on behalf of large firms.
A nostro account is a bank account held in a foreign country by a domestic bank, denominated in the currency of that country.
The accounts are used to facilitate settlement of foreign exchange and trade transactions.
“All the other mining companies like Mimosa are banking locally except Zimplats and we are saying no to that,” Gono said.