Zimbabwe Miners Demand Higher Forex Allocations to Boost Output

(Bloomberg) -- Zimbabwean gold and platinum miners are urging the authorities to provide more foreign exchange to help them boost output next year

  • The Chamber of Mines of Zimbabwe released a report showing the country is expected to produce 34 metric tons of gold this year, compared with 26.4 tons in 2017. Platinum mines need $7 billion over the next five years to raise production, it said.

Key Insights

  • The call for increased foreign exchange comes four days after the central bank revised upward the amount of earnings gold miners can retain to 55 percent from 30 percent. By law, miners are required to sell all their metal to Fidelity Printers and Refiners, a unit of the central bank.
  • Metal producers require access to at least 70 percent of their earnings to meet input costs, the chamber said. A foreign-currency shortage in the southern African nation forced gold miner RioZim Ltd. to temporarily shutter three of its mines last month.
  • Boosting metal production is important for Zimbabwe’s economy. Gold is Zimbabwe’s second-largest export after tobacco, according to the World Trade Organization.