ZIMBABWEAN gold producers are struggling to secure offshore financing for expansion projects.
Speaking during a Gold Symposium organised by Mutapa Gold Resources in Victoria Falls on Thursday, Chamber of Mines Gold Producers Committee chairman Qubeka Nkomo said access to capital had emerged as a major constraint despite strong prospects for the country's largest mineral export.
The symposium ran concurrently with the Chamber of Mines Annual Mining Conference & Exhibition 2026.
"Most gold producers are struggling to raise offshore capital for their expansion projects and are therefore relying on internally generated cash flows to finance their expansion activities," Nkomo said.
"Some financiers are demanding that gold producers lodge physical gold as collateral and maintain escrow accounts to mitigate default risks," he added.
The funding challenges come at a time when Zimbabwe's gold industry is enjoying unprecedented momentum, driven by record international bullion prices and increased investment in production capacity.
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According to Nkomo, gold output reached a record 50,6 tonnes in 2025, up from 38,5 tonnes in 2024, representing a 31% increase.
The production surge translated into export earnings of US$4,6 billion, up from US$2,5 billion in 2024. Gold accounted for 54% of mineral exports and 44% of Zimbabwe's total exports, reinforcing its position as the country's leading foreign currency earner.
Nkomo said favourable market conditions were expected to continue, with gold production projected to exceed 55 tonnes this year and export earnings forecast to reach US$5 billion.
"The medium- to long-term prospects for the gold industry remain positive, supported by favourable prices, ongoing expansion projects and efforts to revive previously closed mines such as Redwing," he said.
However, he warned that the sector's growth trajectory could be undermined if longstanding operational and policy bottlenecks are not addressed.
Among the key concerns raised by producers are foreign currency shortages, unreliable electricity supplies and delays in receiving the surrender portion of export proceeds.
Nkomo said many producers undertaking expansion projects continue to face difficulties accessing foreign currency needed to fund operations and procure capital equipment.
"There is a need to prioritise access to foreign currency, as shortages are delaying the implementation of planned expansion projects," he said.
He also highlighted concerns over delays in the payment of the ZiG equivalent of surrendered export earnings, saying the situation was creating liquidity challenges for producers.
"These delays are creating liquidity and operational challenges, forcing producers to operate on discounted cash flows," Nkomo said.
The concerns reflect broader challenges facing Zimbabwe's mining sector, which has repeatedly cited foreign currency retention policies, power shortages and the high cost of doing business as impediments to growth.
While the government has prioritised mining as a key pillar of economic development and export growth, industry players argue that attracting fresh investment will require a more competitive operating environment.
Nkomo said the industry also continued to grapple with high electricity tariffs, expensive capital and a heavy fiscal burden.
"Overall, prospects for the gold industry remain positive and the sector is expected to continue growing and increasing its contribution to the economy," he said.
"However, unlocking its full potential will require the timely resolution of key growth constraints and the creation of a competitive operating environment that attracts investment into the gold sector."