By Features Editor – Tuesday 22 January 2019
ANALYSIS – (Mining Index) – THE recent announcement and upward review of the new gold production target for 2019 to 40 tonnes could potentially place Zimbabwe among the top 20 gold producers in the world.
Sudan, which was number 20 on the top gold producing countries in 2017 produced 40 tonnes.
In 2018, Zimbabwe recorded 33.2 tonnes of gold deliveries to Fidelity Printers and Refiners (FPR), the highest ever since 1980, raking over US$1 billion in export receipts.
Government will however, need to address foreign currency retention by gold producers, exchange rates and fuel supply to motivate and ensure miners are well equipped in their mining activities.
However, gold output was even higher, as the Zimbabwe Miners Federation president Henrietta Rushwaya lamented on loss of US$50 million worth of gold annually to smuggling, which could not make it to FPR.
With 13 million tonnes of proven gold reserves, economic analyst Eddie Cross noted that Zimbabwe has potential to become the third largest gold producer in world after China and Australia.
In 1981, Australia recorded gold output of 18 tonnes, which grew to 57 tonnes in 1985, and today, it is the second gold producer in the world with an annual output of almost 300 tonnes.
Russia, which is the third largest gold producer recording approximately 255 tonnes, recorded low output of 114.9 tonnes in 1998.
Zimbabwe is forecasted to produce 100 tonnes of gold by 2030. This can only be achieved through increased foreign and domestic investment to capacitate small scale and artisanal miners who are relatively unsophisticated by international standards, whose contribution of 70 percent of the total 2018 output was a major milestone in Zimbabwean gold production.
In 2018, government through the central bank injected US$150 million in the gold support scheme to emerging miners for equipment support.
An investment of US$900 million is thus required for Zimbabwe to reach the targeted yearly output production of 100 tonnes to put it into the top 10 world gold producers by end of 2030.
China is the largest gold producer in the world. Africa produces 20 percent while Asia produces 22 percent, Central and South America account for 17 percent, North America contributes 15 percent and Russia 14 percent.
Zimbabwe needs to create a balance by establishing a gold vault for reserves, become a gold consumption market through beneficiation for job creation and an exporter to earn foreign currency. ENDS//