Gold deliveries increase by 100%

Published: 15 June 2018

Gold miners are currently paying 14 cents per (KWH); they are paying at a premium while other users are paying 10 cents

Gold deliveries to Fidelity Printers and Refiners (FPR) increased 100% in the four months from February to May 2018 following official investigations into rampant parallel market dealings by registered gold-buying agents.

In February, FPR launched a probe into black market activities by registered gold-buying agents suspected of prejudicing Zimbabwe of millions of dollars.

This came against a backdrop of some registered gold-buying agents, particularly in Matabeleland and Midlands, buying a gramme of gold at US$48 (bond notes) and US$38/gramme in cash.

This is in violation of FPR regulations, which require buying agents to pay 70% through bank transfer and 30% cash.

Since the beginning of the exercise the deliveries have steadily increased from 1,1 tonnes in February 2018 to 2,2 tonnes in May.

FPR general manager Fred Kunaka told businessdigest recently that, if closely monitored, the exercise will go a long way in increasing gold inflows.

"The investigation exercise into the rampant parallel market by registered gold-buying agents has been going on very well. Our deliveries from gold-buying agents and small-scale miners have steadily increased since the exercise started, meaning the move to try and eliminate the parallel market is yielding positive results.

"Deliveries to Fidelity Printers and Refiners rose from 1,1 tonnes in February to 2,2 tonnes in May 2018

Basing on the steady increase in gold deliveries recorded as of end of May, we can safely say the monitoring by the Gold Command Taskforce if continued will go a long way in increasing gold inflows thus positively impact revenues for the country," Kunaka said.

The central bank is on record as saying Zimbabwe is losing approximately a tonne of gold per year to side marketing, but may be able to boost the bullion to 27 tonne levels, on the back of current measures to improve deliveries.

Zimbabwe attained an all-time peak of 27 tonnes in 1999 but current economic conditions have seen an increase in the number of side marketers of gold over the years.
Meanwhile, Kunaka said small-scale miners who benefited from the US$40 million loan facility have begun repaying although there have been delays in the procurement of equipment

"Those who benefitted have begun the process of repaying the loans. This has been made possible because the equipment they accessed under the loan facility is operational and now aiding production. There have however been some delays in the procurement of some equipment from suppliers and we are working at rectifying the issue so that the loan beneficiaries may be able to access their equipment," he said.

The Reserve Bank of Zimbabwe (RBZ) increased the loan facility to US$150 million in February this year and, so far, approximately US$80 million has been disbursed to miners to assist them in gold production.

- the independent

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