The country’s largest platinum miner Zimplats has complied with the Reserve Bank of Zimbabwe (RBZ) directive compelling mining firms to bank locally amid reports the company wants to re-engage the government over the matter.
Central Bank governor Gideon Gono last Thursday issued a 24-hour ultimatum forcing Zimplats — a unit of South Africa’s Impala Platinum — to bank locally or freeze its accounts. The directive also barred the mining company’s bankers from facilitating its international transactions as well as processing exports.
Zimplats’ chief financial officer Patrick Maseva-Shayawabaya yesterday said the firm would comply with the RBZ’s order indicating it would engage the apex bank in a bid to bank offshore.
The move by the central bank follows a decision by Cabinet in March this year compelling all mining companies to deposit their revenue locally, following reports hundreds of millions of dollars were “trapped” offshore.
The existence and operation of the off-shore bank accounts, according to Zimplats, was in terms of a mining agreement with the government.
“The directive is most unfortunate because Zimplats understands and fully embraces the policy objectives of the directive and will comply with it. The company is already paying 75% of its total spent through the Zimbabwean banking system with the balance relating mainly to the servicing of off-shore loans which were raised with the knowledge, support and approval of the RBZ,” said Maseva-Shayawabaya in a statement.
“Management recently discussed this matter with the RBZ and believed that the voluntary measures instituted by the company adequately addressed the concerns of the authorities. Management is working closely with the RBZ to ensure localisation of the off-shore bank accounts is implemented smoothly and that the provisions of the company’s agreements including its off-shore loans, are honoured.”
Gono last week said Zimplats was the only mining company defying the directive which was meant to ease the country’s liquidity constraints.
It is understood that some foreign-owned banks operating in the country were holding onto 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. Nostro accounts are used to facilitate settlement of foreign exchange and trade transactions.