Business Reporter
Fidelity Gold Refinery (FGR) has announced a projected 58% increase in gold deliveries for 2025, aiming for a total of 38 tonnes.
This increase is attributed to enhanced output and prompt payments for deliveries, marking a significant boost in efforts to increase foreign currency earnings for Zimbabwe.
The yellow metal, a key forex earner for the country, is showing remarkable resilience and growth, indicating a positive outlook for the upcoming year. Peter Magaramombe, the general manager of FGR, shared insights during the recent Mine Entra 2024 event in Bulawayo, stating,
“The gold sector has demonstrated remarkable resilience and growth, despite global economic uncertainties. This performance is a testament to the sector’s potential and the efforts of our stakeholders.”
Magaramombe reported that gold deliveries for the nine months ending September 30, 2024, totaled 24 tonnes, reflecting a 7.2% increase compared to the same period last year. He attributed this growth to increased mining activities and the prompt payment system in place, emphasizing,
“All our buying centres have cash all the time. It’s a cash-and-carry business.”
As of late September, the price of gold had risen significantly, from US$2,324.98 per ounce on June 30, 2024, to US$2,658.08 by September 24, 2024. Magaramombe noted,
“We project 35 tonnes of gold to be delivered to Fidelity as of December 31, 2024. This projection is conservative, considering the sector’s current momentum and potential.”
However, economic and political analyst Rejoice Ngwenya raised concerns about the management of gold resources in Zimbabwe. He stated,
“I have no issue with the brightness and resilience of gold in the future. The problem is that our gold is not managed like a crucial resource endowment. It’s used for money laundering as shown by the Gold Mafia documentary.”
He further criticized the Zimbabwe Gold (ZiG) currency, suggesting it lacks the necessary backing and credibility.
Economist Prosper Chitambara echoed the need for stronger reserves, stating,
“We need to continue to build our reserves; our reserves are currently not adequate to provide a strong backing to Zimbabwe Gold.” He highlighted that Zimbabwe’s reserves are significantly lower compared to neighboring countries, urging the need to build up to at least US$3 billion.
As the gold sector continues to show promise, the focus remains on ensuring that the benefits of this resource trickle down to ordinary Zimbabweans while addressing the structural deficiencies in the gold supply value chain.
Zim GBC News©2024