- September 4, 2020
- Posted in LOCAL
State gold-buying entity, Fidelity Printers and Refineries (FPR), has secured cash to pay for outstanding deliveries and has committed to henceforth, pay cash upfront for all gold deliveries made.
The development comes as miners had become increasingly worried at FPR’s delays in paying for gold deliveries.
On its part, the country’s sole buyer and marketer of the yellow metal blamed Covid-19 that has seen countries implementing lockdowns that have resulted in the suspension of air travels.
In a memo to its membership, the Zimbabwe Miners Federation — that account for the biggest constituency delivering gold to the state buyer — said it had been advised that normalcy had returned.
“We are pleased to announce that FPR gold buying centres began paying out all outstanding arrears for gold bullion delivered to them by Tuesday, the 1st of September 2020,” advised ZMF chief executive officer Mr Wellington Takavarasha.
“This set up of prompt payment by FPR after receiving bullion shall be the order of the day going forward,” he said.
Delays in paying out the miners for their deliveries have been pointed out as one of the factors contributing to the smuggling of gold produced in Zimbabwe to Dubai and neighbouring South Africa.
Under the US$12 billion mining roadmap launched by President Mnangagwa in October last year, gold is expected to contribute about US$4 billion by 2023 from the current US$2 billion.
The latest payment arrangement comes after gold deliveries to FPR dropped by 22 percent to 12,018 tonnes in the first seven months of the year compared to 15,4 tonnes during the same period last year.
Latest data from FPR that falls under the purview of the Reserve Bank of Zimbabwe, indicate that the bulk of the gold deliveries during the period under review came from the small-scale miners who delivered 7,128 tonnes, while large scale producers accounted for 4,89 tonnes.
Last year, the small-scale mining sector contributed over 60 percent of the yellow metal that was delivered to the formal market. Of late small-scale miners, despite accounting for the bulk of the gold delivered to the formal market, have lamented a number of challenges bedevilling the sector.
These include delays in payment for gold deliveries to FPR, equipment as well as fuel shortages.
Gold and agriculture, mainly tobacco and horticulture are expected to spearhead the country’s economic turnaround initiatives given that the products produced are on high demand on the international market.