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ZiG faces new threat...as gold output plunges

Local News
With the Reserve Bank of Zimbabwe banking on increased gold output to shore up the recently introduced gold-backed Zimbabwe Gold (ZiG) currency

MASSIVE gold leakages have seen the country recording a 1,9% drop in output of the yellow metal in the first quarter of 2024, NewsDay has leant.

With the Reserve Bank of Zimbabwe banking on increased gold output to shore up the recently introduced gold-backed Zimbabwe Gold (ZiG) currency, fears abound that the fall in output could seriously threaten the fragile currency born from the ashes of the defunct Zimdollar which was demonitised after being rendered worthless by inflation.

In an effort to plug the rising mineral leakages, the Mines and Mining Development ministry has dispatched 15 teams to nine mining provinces to carry out this year’s first quarter gold mobilisation exercise.

Speaking at the 2024 first quarter gold mobilisation launch, Mines and Mining Development minister Winston Chitando said the government would continue to support small-scale miners with various strategies to enhance production.

“For 2024 from January to April, the gold deliveries to FGR (Fidelity Gold Refineries) sit at 8,4 tonnes against a target of 40 tonnes by the end of the year. In 2023 for the months of January to April a total of 8,57 tonnes were delivered, this represent a 1,9% decrease,” said Chitando whose job and his deputy Polite Kambamura’s will be on the line should they fail to provide enough minerals to back the ZiG currency.

“The Ministry of Mines and Mining Development has employed a number of strategies to capacitate the small-scale miners to enhance their production. The strategies include establishment of gold service centres and the first site which is in Makaha, Mashonaland East province is now complete.

“Mineral leakages deprive the government of much-needed revenue from taxes and royalties. By working together, we can ensure that every ounce of gold extracted within our borders contributes to the national good,” Chitando said.

In the first four months of 2024, large-scale miners delivered 4,3 tonnes of gold to FGR compared to 3,4 tonnes in the same period of 2023, representing a 26% increase.

“This is a result of expansion projects and use of technology (bioleaching) to extract gold by the large-scale miners,” said Chitando.

Gold delivery from small-scale miners, who happen to be the main contributors to the country’s gold output, has, however, nosedived by 23% in the first quarter.

“For small-scale miners, the gold deliveries to FGR have decreased from 5,2 tonnes in 2023 to four tonnes in 2024, a 23% decrease. The small-scale miners have contributed 48% of the gold delivered to FGR for the year 2024 as compared to 60% contribution for the previous year, 2023.

“Over the years since 2020, small-scale miners have been the major contributors to gold deliveries to FGR contributing more than 60%. However, for the year 2024, the contribution by small-scale miners is ranging between 42% and 53% which calls for investigations into the decline in gold deliveries,” Chitando added.

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