TINASHE MAKICHI/ LIVINGSTONE MARUFU
Government is failing to make the required 15 percent down payment to access a $100 million South Korean facility for small scale gold miners.
The Ministry of Mines and Mining Development has all along been saying that it is working on final terms of the loan facility from South Korea but information gathered by Business Times points that efforts have since stalled.
The facility was being spearheaded by gold mobilisation committee which was set up by government. The committee consists of officials from Ministry of Mines and Mining Development, Minerals and Border Control Unit, Zimbabwe Revenue Authority, Environmental Management Agency and the Reserve Bank of Zimbabwe.
Reserve Bank of Zimbabwe (RBZ) governor Dr John Mangudya told Business Times that the central bank has not received any documentation with regards to the South Korean loan as is required. Instead he said government would focus on increasing the gold development initiative to small scale miners to increase production in the sector.
“I am aware of the Korean facility and at one time I understand the Ministry of Mines and Mining Development was in Korea to negotiate about the facility but up to now as the Central Bank we have not received any documentation of the facility as is supposed to be done when there is an application for a loan facility. We don’t have the term sheets for that facility but I should confirm that I am aware of that facility,” Mangudya said.
Mangudya’s remarks come as well-placed sources told Business Times that the facility was hanging as government is failing to raise the 15 percent or $15 million down payment.
This comes as government last year embarked on a gold mobilisation outreach programme as part of measures to increase gold deliveries. Targeting small scale miners, artisanal miners, gold buyers and millers, the outreach programme aimed at strengthening the relationship among key stakeholders in the gold mining industry and to ensure that activities carried out are in an aligned manner.
The Zimbabwe Miners Federation (ZMF) has drawn down $100 million of the government’s $150 million Gold Development Initiative Fund to ramp up production by small scale miners. ZMF is of the opinion that they are still within reach to attain the 30 tonnes target of gold this year. Already, 240 miners have benefited from the fund.
This comes after the small-scale miners have so far produced over 60 percent of total gold output in the first seven months of 2018.
Artisanal miners’ target of 20 tonnes in 2018 may be realised given that gold production reaches its peak during the second half of the year when production is not affected by rains.
“Artisanal miners have so far drawn down $100 million out of the $150 million Gold Development Initiative Fund as they move to increase production in the gold sector. We have and we continue to provide the artisanal miners with all necessary funding support as they are the ones who are producing most of the gold in the country,” Mangudya said.
The central bank has increased the fund to $150 million from $80 million last year to ramp up production thereby increasing exports, employment and foreign currency for the economy.
Mangudya said the facility continues to motivate small scale miners and more needs to be done to maintain the current trajectory.
“20,8 tonnes have so far been produced in the first seven months of 2018 to July 31 at an export value of $850 million. From that total, small scale producers produced 13,5 tonnes of gold while large scale producers have contributed 7,3 tonnes. Due to the current initiatives the small-scale producers continue to outperform primary producers,” he said.
