High costs hold back gold mining – central bank

High costs hold back gold mining – central bank

HARARE, September 12 (The Source) – Reserve Bank of Zimbabwe governor, John Mangudya says Zimbabwe has a proven reserve profile of between 15 million and 20 million tonnes of gold but has so far mined 580 tonnes because of the high costs involved.

The central bank chief, who met members of the small-scale miners association in Zvishavane on Friday, said among the problems affecting the production of gold in the country were high costs of production.

He said his monetary policy statement due this week would look into the problems affecting small scale gold miners and improve market confidence.

“We have 15-20 million tonnes of gold reserves in this country,” Mangudya said during the meeting.
“But these are yet to be fully explored. To date, we have so far mined 580 tonnes only. These proven reserves are yet to be mined. We have a problem in this country because of production costs are so high.”

Commenting on macroeconomic developments, Mangudya said the fiscal space was narrow, which resulted in government failing to raise funding to finance its programmes.

Finance minister, Patrick Chinamasa said government had spent 97 percent of revenue on salaries in the first six months of the year.

“We have a balance of payments deficit and this creates problems. We also have a narrow fiscal space, since most of the money (revenues into government) goes towards salaries and wages. Production is dependent on good investment climate,” said Mangudya.