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Business Reporter
THE Reserve Bank of Zimbabwe has mobilised $50 million for an accelerated gold production programme that will see the country realising at least $1,5 billion from gold exports by 2020. Fidelity Printers and Refiners shall enter into an agreement with Zimbabwe Mining Development Corporation to set up a special purpose vehicle to exploit gold under Fidelity’s ZimGold.

Reserve Bank Governor Dr John Mangudya revealed the plans in his second monetary policy statement yesterday, saying the plan targets raising gold output to 30 tonnes from 13t.

The policy, while short on quantitative monetary policy interventions, contained measures to improve competitiveness of industry, the economy, confidence in banks and compliance with regulations.

Dr Mangudya said the central bank had arranged the facility to be managed by its unit, Fidelity Printers and Refiners, for own mining activities and support to viable gold mining projects.

“The Accelerated Gold Production Initiative’s vision is to increase gold production to 30 tonnes per year by 2020, that is revenue of around $1,5 billion at current prices,” Dr Mangudya said.

“This target is achievable as in 1999 the country produced its highest ever gold tonnage at 27 tonnes at a time when artisanal production was still minimal at around 5 percent,” he said.

Thirty percent of the country’s gold production, amounting to 3,9 tonnes, is now coming from the artisanal and small-scale producers following increased support to the miners.

Dr Mangudya said the SPV will focus on harnessing low hanging gold resources with particular emphasis on alluvial and prolific reef deposits supported by bulk open pit mining and on old underperforming assets as a preferred mining method to enhance gold deliveries.

ZimGold will structure operations to provide for contract gold mining. It will also acquire interests in Brownfield projects and venture capital gold structures to boost production.

Gold is a key foreign exchange earner for Zimbabwe, raking in $564 million last year, the third biggest export earnings after platinum at $574 million and tobacco, which raked in $842 million.

Growth in gold production and exports is central to economic growth in Zimbabwe, as mineral exports accounted for an average of 51 percent of total export earnings between 2009 and 2014.

Fidelity Printers and Refiners has continued to increase the volume of gold it handles, which grew by 10 percent from 12 661 tonnes in 2013 to 13 899 tonnes in the period to December 2014.

Dr Mangudya said deliveries were projected to grow by 7,1 percent this year to reach 15 tonnes, having exceeded the 10 tonnes required to rejoin the London Bullion Market Association.

Over the period 2012 to 2014, the country witnessed a decline in deliveries from large scale gold producers from 10,86 tonnes in 2012 to about 9,96 tonnes in 2014. A decline of about 8,3 percent.

During the same period, gold deliveries from small-scale producers, however, increased by 51,1 percent from 2,6 tonnes in 2012 to 3,9 tonnes in 2014 due to support initiatives by Government.

Efforts to harness gold by the Ministry of Mines and Mining Development through the Gold Mobilisation Committee from the small scale sector including artisanal miners are starting to bear fruit.