Negotiations for return to London Bullion Market commence
THE country is targeting to upscale its engagement for re-accreditation into the London Bullion Market this year as Government seeks to optimise earnings from gold through participation on a global market.
Last year, Zimbabwe had a strong performance in gold output at a record 33,2 tonnes that raked in over $1 billion dollars in export receipts.
According to ZBCtv, Mines and Mining Development Deputy Minister Polite Kambamura said rejoining the London Bullion Market Association (LBMA) opens the country’s yellow metal to secure a market that offers competitive prices and protection against price movements.
Discussions to rejoin the LBMA have been on the agenda for the last five years, with experts contending that this would enhance the country’s ability to sell its mineral to global buyers.
Zimbabwe dropped out of the association in 2008 after production of the yellow metal plummeted to 3,5 tonnes, which is far less than the stipulated 10 tonnes.
Now with a projected output of 40 tonnes this year, the Ministry of Mines and Mining Development believes it has a strong case to seal its readmission into the bullion association this year.
One of the prerequisites for re-admission on the world gold market was for Zimbabwe to refine 10 tonnes of gold for three consecutive years, a requirement fulfilled in 2015 when production hit 21 tonnes.
At present, Zimbabwe is selling its stock to Rand Refiners of South Africa where a levy of 0,3 percent is effected on the total earnings.
It is widely believed that the LBMA, which was established in 1987, sets the benchmark for gold and silver metal bars across the world.
In particular, the LBMA Good Delivery List is used by many precious metals exchanges around the world to identify refiners whose gold and silver bars are accepted in their own markets. — ZBCtv/Business Chronicle