Thursday , January 28 2021

UPDATE 1-Zimbabwe will allow gold, platinum mines to maintain higher dollar earnings

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HARARE, Nov. 19 (Reuters) – Zimbabwe will allow gold and platinum mining companies to hold up to 55 percent of their revenues in dollars, representatives of the government and central banks said on Monday as authorities in a South African country move to ensure that operators remain viable.

The mining industry accounts for more than two thirds of export earnings in Zimbabwe, but some companies are observed in the sector due to the dollar crisis, which has led to a reduction in imports of spare parts and other consumables.

Deputy Minister of Mines Polite Kambamura said that gold producers who sell their products to a processing subsidiary of the central bank will now hold 55 percent of their sales in dollars, compared with 30 percent earlier.

According to him, the threshold should gradually increase to 70 percent.

Central Bank Governor John Mangudea said US dollar retention rates for platinum and chrome miners were increased to 50 percent from 35 percent.

“We made the decision that there is a vitality in the mining industry, making sure that we don’t kill the goose that lays the golden egg,” said Mangooda during the publication of the survey results on the state of production.

Manguduya, without specifying details, said the central bank would set up a special fund to help mining companies with additional requirements of the US dollar.

The results of the survey showed that although the leaders of the mining industry positively assess the prospects for the industry in 2019, they are pessimistic about the ability of the government to maintain a predictable and consistent policy in the field of the mining industry. (Report by Macdonald Dzirutwa, editing by Dale Hudson)

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