Gold miners say they can only invest the US$1 billion required for development over the next five years if they can retain a greater share of their foreign exchange earnings.
In January last year, the central bank announced that exporters must hand over 40% of their foreign currency earnings, which is then paid out in the local currency.
Isaac Kwesu, chief executive officer of the Chamber of Mines of Zimbabwe, said the government should ease those rules as local financial markets have limited capacity to finance such large capital requirements.
“There is need for government to relax the marketing arrangement and allow gold producers to export their gold and use it for capital raising,” Kwesu told lawmakers on Monday.
He said producers want to retain 80% of their earnings in foreign currency.
Most gold miners, especially those not connected to dedicated powerlines, continue to face electricity outages, resulting in production stoppages, Kwesu said.
Still, Zimbabwe’s gold output climbed about 47% in the first seven months of the year. The governments expects Zimbabwe to produce between 35 and 40 tons of gold of the precious metal in 2022.
To increase production, the government in 2021 announced that gold producers who deliver gold quantities above their average monthly deliveries could keep 80% of that incremental portion of their deliveries. Companies that list on the Victoria Falls Stock exchange get to keep 100% of their incremental exports.
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Bloomberg/newZWire
