Harare (New Ziana) – Large scale gold producers will now retain 70 percent of sale proceeds in foreign currency while the remainder will be paid out in local currency, the country’s sole gold buyer, Fidelity Printers and Refiners (FPR) said on Tuesday.

Previously, miners were entitled to 55 percent foreign currency retention, while the remainder was paid out in local currency.

Miners have been lobbying for an upward adjustment of the gold foreign currency retention threshold to above 75 percent in order to encourage producers to deliver gold to Fidelity.

“With effect from 26th May 2020, gold producers shall be paid under a 70/30 payment arrangement scheme in terms of which 70 percent of the gold sale proceeds shall be paid into the producer’s nostro account and the balance of 30 percent shall be paid in local currency at the ruling exchange rate into the producer’s ZW$ account,” FPR general manager Fradreck Kunaka said.

“Small scale gold buying agents and artisanal producers shall be paid
in cash at a flat price of USD 45 per gram of fine gold.”

Kunaka also announced new rules covering operations of gold buying agents, both large and small scale.

“Large gold buying agents must have a mining operation producing a minimum of 50 kilograms of fine gold per month to qualify for a Fidelity Printers and Refiners agency permit.

“Small scale gold buying agents will have to enter into an agency agreement with FPR which contract shall clearly spell out the terms and conditions under which the agents shall operate,” he said.

Kunaka said monitoring would be increased to curb gold leakages.

“FPR and the national gold monitoring teams are enhancing surveillance to ensure that all gold is sold through FPR in line with the country’s regulations,” he said.

The increased retention threshold is likely to spur growth in the gold sector which is the country’s top foreign currency earner.

The low retention thresholds which were obtaining were undermining efforts to increase national output as miners were tempted to divert gold to the illegal parallel market, fuelling smuggling.

Gold earnings of US$4 billion per annum are expected to anchor the achievement of the government target of a US$12 billion mining sector by 2023.
New Ziana