Former finance minister Tendai Biti has called for a raft of measures including stripping the central bank’s Fidelity Printers and Refiners (FPR) of its sole right to buy gold as part of efforts to curb minerals smuggling
Speaking in parliament, Biti also called for the immediate amendment of the Gold Act to allow various financial institutions to buy the precious mineral and to enable Zimbabwe to sell finished gold products.
The former Finance Minister was responding to a report by the Portfolio Committee on Defence, Home Affairs and Security Services, focusing on the security of minerals which revealed that delays in payment to gold producers by FPR was contributing immensely to its leakages and illicit trading.
“There is no reason why Fidelity Gold Printers should have a monopoly of buying gold in this country,” Biti said.
“There is no reason why Fidelity Gold Printers should pay gold miners a value which is less than the international price of gold. The difference between the international price of gold and what Fidelity is paying at any given time is about 20%.”
According to the legislator, an estimated US$1 billion worth of gold being smuggled out of the country is a tiny approximation.
“Experts estimate that 70% of the gold that is being refined at Rand Gold Refinery is Zimbabwean gold. We are mining around 40-45 tonnes of gold per year but what is being accounted for is only 15-18 tonnes per year.
“What is happening to the 20 tonnes that we are mining? It is being smuggled. We have professional smugglers that have made Zimbabwe their permanent domicile and our border posts as the report of the Committee confirms are leaking, particularly Beitbridge,” lamented Biti.
As part of solutions to minimize the leakages, Biti called for the revision of laws guiding gold trade.
“We should amend the Gold Act and allow gold licences to be given to banks for instance. Banks should be allowed to buy gold.
“More importantly, we should have value addition of gold in this country so that what we sell are not gold bars but gold products. More importantly, we should use the gold as a reserve for our currency.”
He also called for the change of an ‘extractive’ mindset.
Added Biti: “Why not use our gold as reserves and to form part of the world, why not put our gold in the sovereign wealth fund? We are losing gold because our mindset is still extractive.” – (New Zimbabwe)