8 February 2013

Zimbabwe: Gold Glitters, Maintains Its Safe Haven Status

PLAYERS in the gold industry are set to benefit from a general global sectoral growth in 2013 following a positive performance in 2012, a leading gold market development organisation has said.

In its 2012 full year market summary, the World Gold Council (WGC) said despite a weak fourth quarter, the year marked the 12th consecutive year of annual gains with gold in US dollars closing the year 8,3% up at US$1 657,50 /oz on the London PM fix.

The development has benefited the global commodities market, with Reserve Bank of Zimbabwe governor Gideon Gono recently announcing that buoyant gold prices have seen deliveries to Fidelity Printers and Refiners in Zimbabwe, improving by 15,7% from 11 645kgs in 2011 to 13 474kgs in 2012.

"Gold prices continue to benefit from the metal's safe haven status, particularly in view of global economic turbulences that characterised the greater part of 2012," Gono said in his Monetary Policy Statement on Thursday last week.

The firm mineral prices have become an incentive for miners to deliver their gold through the formal channel following years of mineral leakages to South Africa.

According to the Chamber of Mines' figures, gold production in 2012 rose 13,47% from 12 992kgs in 2011 on the back of attractive international prices and improved investment into exploration at the major producing companies.

Going forward, the WGC forecasts the trend to continue in 2013 in line with prior predictions that gains in the gold price are expected in the year due to marginal growth in economic activities in advanced economies from 1,3% in 2012 to 1, 5% in 2013.

"There are still lingering economic difficulties and the global gold industry is fragile but promising; mostly as a result of a good performance in the final quarter of 2012 with signs of economic recovery in several countries, most notably in the US and China as well as an anticipated improvement in the global economy," WGC said.

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