Mining loans needed to realise 100t gold target
MINES and Mining Development Minister, Winston Chitando, says the target of producing 100 tonnes of gold is achievable but producers need improved access to alternative sources of financing such as loans.
As the Government drives towards the US$12 billion mining industry by 2023 gold production, alongside platinum group metals, hydrocarbons like oil and gas, coal, gold, lithium, chrome and ferrochrome, must be the major contributors.
The target will be made possible by optimum investment and output levels in all mineral commodities. The gold sector, drawing from both small and large-scale producers, targets to produce 100 tonnes of gold from about 30 tonnes.
The mining industry is expected to contribute significantly to the country’s vision of Zimbabwe becoming an upper-middle-income economy by the year 2030 with gold playing a significant role.
Speaking at the Chamber of Mines Annual General Meeting and Conference, Minister Chitando said the ravaging effects of Covid-19, which caused a fall in mineral prices as well as death of key personnel in the sector, should not dampen spirits in mining but motivate players to overcome challenges while also keeping focused to achieve the set targets.
“It is worth noting that despite these challenges, the Zimbabwe mining sector has remained resilient as we work towards attaining our milestone of a US$12 billion mining industry by the year 2023.
“The sector continues to play a significant role in the country’s economic development, contributing 60 percent of export receipts in 2020,” said the minister.
“Government’s thrust to increase gold production from the current levels of about 20,87 tonnes in 2020 to about 100 tonnes by 2023, contributing US$4 billion to the US$12 billion is an achievable milestone. In order to achieve this target, Government is mainly looking at enhanced exploration and development of medium to large-scale mines as well as capacitation of small-scale miners,” said Minister Chitando.
He said the Government would seek to intensify its monitoring and surveillance exercises to curb illicit trade in gold and ensure gold is delivered to Fidelity Printers and Refiners.
The minister said there were a number of gold projects coming up, which will further increase production.
These include Shamva Gold Mine, which was commissioned last year and Eureka Gold Mine, which is set to resume operations next month, as well as the Caledonia Mine installation of a new US$60 million shaft in Gwanda.
The minister said the Government was also working with various private players to capacitate small-scale miners through the introduction of private-led gold service centres as well as command mining, using the same model as in agriculture.
“There are three specific issues that have come out here (conference) and we will pick them up in our normal interface. There is a need to ensure that we surpass 100 tonnes target and utilisation of gold loans through the intervention of coming up with structures where gold producers will be allowed to have structures in which they access gold loans. There is need for us as Chamber and Government to come up with a menu of alternative finance options,” said Minister Chitando.
He said there will be engagements among stakeholders within the purview of the Chamber of Mines to that effect.
The theme for the conference, which effectively ended yesterday was: “Navigating turbulent times — Sustaining growth of the mining industry beyond Covid-19.”
Minister Chitando said the conference came at an appropriate time as the Government was working hard to implement the National Development Strategy 1 (NDS1:2021-2025), a key building block towards Vision 2030.
He said policies by the Second Republic have seen an increased investor appetite in the mining sector.