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:
<blockquote>
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.
</blockquote>
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 <a href="https://businesstimes.co.zw/rbz-in-forex-retention-u-turn/">Business Times</a>. She said:
<blockquote>
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.
</blockquote>
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:
<blockquote>
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.
</blockquote>
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.
More: <a href="https://www.pindula.co.zw/">Pindula News</a>

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RBZ Yields To Small-scale Gold Miners' Demand

Youths who are involved in small-scale mining have appealed to authorities to reduce the mining levies required for one to operate in order to allow growth and development in the sector.
In June 2021, the government, through Statutory Instrument 185 of 2021, announced new mining fees which are considered exorbitant by small-scale miners.
Speaking to <a href="https://www.newzimbabwe.com/small-scale-miners-cry-foul-over-exorbitant-taxes/" rel="nofollow">NewZimbabwe.com</a>, Zimbabwe Miners Federation (ZMF) youth secretary for Matabeleland North, Nkululeko Ngwenya said the high fees are negatively affecting the growth of the mining sector. He said:
<blockquote>
Mines inspection fee is US$300, Environmental Management Agency (EMA) wants US$250, then the council also wants US$400. The money needed is too much and affects growth in the sector.
We are asking that the government might consider our pleas and reduce operations fees so that the industry may grow and boom, supporting development in the mining sector.
</blockquote>
Ngwenya said the exorbitant fees have hindered many small-scale miners from formally registering and regularising their illegal operations.

Small-scale Miners Plead For Reduction Of Taxes

The Reserve Bank of Zimbabwe (RBZ) has launched an investigation into small scale gold miners’ operations following a decrease in deliveries over the past few weeks,
Deliveries to Fidelity Printers and Refiners (FPR) declined from an average of 90 kilogrammes (kg) per day to 20 kg per day shortly after the RBZ presented its monetary policy statement. Businessman Joseph Kanyekanye said miners were not happy with the new policies. Kanyekanye said miners were not happy with the decrease of the foreign currency retention percentage from 70 to 55 percent. The rest of the money will be paid for in local currencies at the prevailing rate at the 2,5 percent new interbank market rate.
More: <a href="https://www.financialgazette.co.zw/rbz-probes-gold-miners/">Financial Gazette</a>

RBZ Probes Small Scale Miners As Gold Deliveries Dwindle

Small-scale and artisanal miners produced two tonnes more gold compared to large mines in the first quarter of the years. The small-scale miners produced 6,169.29kg of golf compared to 4,027.85 kg produced by the large firms.
Zimbabwe Miners Federation (ZMF) spokesperson, Dosman Mangisi said,
<blockquote>Small-scale miners are increasing output on a month to month basis due to a number of factors. Firstly small-scale gold producers now shun the taking of ores to customer Miller’s preferring to do for themselves what we call onsite milling which has more beneficiation, the high appetite of using hammer Mills by the miners which are affordable.</blockquote>
More: <a href="https://www.newzimbabwe.com/small-scale-gold-producers-outperform-large-mining-firms/" rel="noopener" target="_blank">New Zimbabwe</a>

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