The recent announcement by the Government of Zimbabwe (GoZ) to allow direct sales of gold to external refiners has been met with praise from industry experts. This progressive approach is seen as a positive move to address the existing challenges faced by local companies, such as Fidelity Gold Refiners (FGR), and the wider economy.
Female corporate affairs professional advocating for community development and sustainable mining practices Alexandra Mliswa said the decision to allow direct sales will enable local companies to explore competitive markets at their own cost, potentially attracting more investment into the country.
Mliswa said the increased revenue generated as a result of this move could also help the government achieve its overarching governmental goals, such as generating revenue for the government, controlling the export of illegally mined products, enhancing environmental protection or offsetting exchange rate impacts caused by exports of several commodities.
“The progressive approach of the GoZ should first be applauded. I think that when something has been tried and failed, or at least no longer generating the expected results, then new action must be taken. Direct sales of gold to external refiners will help alleviate some of the challenges Fidelity Refiners or the economy at large is facing, whether they be new, or existing. Allowing direct sales will let local companies search for competitive markets at their own cost and possibly invite more investment into the country. This increased revenue could also assist in seeing that the GoZ achieves certain overarching governmental goals such as generating revenue for the government, controlling the export of illegally mined products, enhancing environmental protection, or offsetting exchange rate impacts caused by exports of several commodities,” Mliswa said.
Mliswa also said as a regulator, the GoZ is now being seen as a reliable entity. This will bode well for the industry, as it can look forward to more efficient handling of regulatory processes. She also added on saying allowing direct sales of gold will ensure that employees can receive payment on time and any other benefits. This will spread the risk, ensuring that the industry remains viable even when the host country is facing difficulties.
Industry experts have called for stricter reporting regulations for companies that decide to take the ‘direct sales route.’ There is also a growing interest in mandatory and periodic ESG (Environmental, Social and Governance) reporting for these companies.
Overall, the decision by the GoZ to allow direct sales of gold is viewed as an exciting one. It is hoped that other companies will follow suit, boosting the local industry and stimulating the wider economy. However, it remains to be seen how this move will pan out, and yet, the positive effects are already being felt by the industry.