RBZ Yields To Small-scale Gold Miners' Demand

The Reserve Bank of Zimbabwe (RBZ), has reportedly restored the 100% foreign currency payments to small-scale gold miners, who produce 62% of the country’s gold.

This comes after the RBZ announced late last year that all economic sectors were subject to a 75% uniform forex retention. The central bank said at the time:

With effect from 1 November 2023, foreign currency retentions on exports shall be standardised at the level of 75% across all sectors of the economy and all special dispensations granted to some sectors of the economy shall be removed.

Small-scale miners then pressured the RBZ to rescind the policy and resume paying 100% in foreign exchange.

Zimbabwe Miners Federation (ZMF) president Henrietta Rushwaya confirmed the latest development to Business Times. She said:

Small-scale miners have been getting a 100% forex retention threshold all year round in 2023 and we didn’t suffer retention challenges.

There was an impasse for a week but the authorities were quick to resolve it.

The Gold Miners Association of Zimbabwe CEO, Irvine Chinyenze said the 75% forex retention was going to promote the illicit flow of gold out of the country. He told Business Times:

There was a danger that smuggling was going to be rampant as miners were going to look for more lucrative markets where they get value for money rather than lose value in the process.

This was going to reduce production at an alarming rate as miners were going to diversify to other sectors that wholly give earnings in US$.

Though we can’t quantify criminality, the country was going to lose over US$2bn in revenues if the current policy direction was not going to be reversed.

This was going to see a great deal of forex being externalised beyond the country’s borders thereby losing massive revenues along the way.

This was going to create an influx of gold mafia gangs as the authorities created a thriving environment for them to smuggle and externalise United States dollars through illicit deals.

In 2020, Home Affairs and Cultural Heritage Minister Kazembe Kazembe said that Zimbabwe was losing US$100 million worth of gold every month through international smuggling rings.

In 2023, Al Jazeera’s Investigative Unit (I-Unit) claimed that Zimbabwe’s government was using smuggling cartels to sell gold worth hundreds of millions of dollars.

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