Published by the government of Zimbabwe
19 November 2008
Harare — ZIMBABWE'S gold deliveries fell 181,6 percent last month compared to the same period last year. According to the Chamber of Mines, gold output for October was 125 kilogrammes, down from 352kg last year.
Smuggling has emerged as the greatest undoing in the sector with reports that large amounts of the precious mineral are clandestinely finding their way out of the country.
However, the local sector has also reported operational challenges that are constraining production.
Zimbabwean gold producers are grappling with power cuts and inadequate revenue to finance day-to-day operations.
As a result, several gold mines have ceased operations.
Chamber of Mines acting chief executive Mr Doug Verden said unless gold producers got a relief payment from the Reserve Bank of Zimbabwe, production would remain low and all mines could close down.
He predicted that November and December output would even be lower.
"All mines have exhausted stockpiles of raw materials they had and if no immediate relief comes from the RBZ, all mines may close down," said Mr Verden.
Gold miners say they cannot continue with operations because the RBZ has not paid their revenue in foreign currency from the gold sold.
According to Zimbabwean laws, Fidelity Printers, a subsidiary of the central bank, is solely mandated to sell gold on behalf of producers. Producers get 60 percent of the proceeds in foreign currency while the remainder would be liquidated at the prevailing exchange rate.
But only recently, the Chamber of Mines revealed that no payment had been made to gold miners in foreign currency since March this year. In a statement to the RBZ, the chamber, an umbrella body that represents mining houses, claimed the central bank owed gold producers in excess of US$30 million.
Metallon Gold, the country's largest gold company, said last week it has stopped production at its five mines.
The company controls just over 50 percent of the country's gold sector.
At its peak, Zimbabwe produced nearly 30 000 tonnes of gold in 1999.
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Where will Comrade Gono get the foreign capital to fund the ZANU-PF Congress?
If these figures are accurate, then Zimbabwe has certainly fallen off a cliff already.
If the nation produced 30,000 metric tones of gold in 1999, then the average monthly output was 2,500 metric tones. That's 2,500,000 kg per month compared to 125 kg for October this year. That means that in the nine years since Robert Mugabe decided to wreck the economy, gold production has actually fallen by 99.995%.
Wasn't gold mining supposed to account for 40% of all export earnings this year?
125 kg is equal to 4,409.2452 ounces. Today's price in NY was about $740US per ounce. That means that the entire industry only earned $3,262,841.45 for the month of October, down from $25,573,622,450.00 per month (or $306,883,469,400US annually) in 1999 at an average price of $290US per ounce.
Where did it all go to?
No wonder there's no money to feed the people; and no wonder Mugabe and those ZAINY-PF types are fighting so hard to protect their control of what's little is left.
If gold accounts for 40% of all export earnings, that means that the entire country will probably only earn about $100,000,000US in forex this year. That's probably 20% or 30% less then the NGOs spent last year. That means that he's being vastly outspent by the organizations actually trying to help the people.
No politician enjoys knowing that he is impotent, and Robert Mugabe most certainly is. The only way that he could increase his power over the population was to cut them off from any outside funding, as he did, and continues to do so.
This must be the new Zimbabwe math. It would be impossible to fall more than 100% unless they were taking gold back rather than delivering it.
By the article's own numbers of 352 kg last year and 125 kg this year, gold deliveries only fell by 64.5%
Back to school! Oh that's right, they're all closed.