CommoditiesFinanceGold & Silver

Zimbabwe raises gold miners’ Forex allowances after output halt

Highlights

  • Allocation increased to 55% of retained earnings from 30%
  • RioZim shut three mines last month because of FX shortage

Zimbabwe’s central bank increased the amount of foreign exchange that gold companies can retain after a shortage forced some mines to close.

Metal producers in Zimbabwe have been struggling to meet production costs because of the shortage of hard currency. That forced RioZim Ltd. to temporarily shutter three of its mines last month, curbing a key source of the country’s export earnings.

Gold miners will be allowed to retain 55 percent of their foreign-exchange earnings, up from 30 percent previously, Reserve Bank of Zimbabwe John Mangudya said in a phone interview Thursday from the capital, Harare.

“We have reached an agreement with the Chamber of Mines,” he said. “We will continue to monitor the situation on the ground to ensure viability for the sector.”

Zimbabwe produced 30.3 metric tons of gold in the 10 months through October, surpassing the government’s target for the full year. The metal is Zimbabwe’s second-largest export after tobacco, according to the World Trade Organization.

Under Zimbabwean law, producers including RioZim and Metallon Corp. are required to sell all of their gold to Fidelity Printers and Refiners, a unit of the central bank.

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