Zimbabwe chances fail

WA mining companies knocking on the door of opportunity in Zimbabwe may find it slammed in their faces.

Australian companies Delta Gold and Rio Tinto are two recent casualties of the country’s mining problems.

Zimbabwe’s gold mining industry faces collapse and closure within a matter of weeks due to a lack of foreign currency to import the necessary materials to keep the industry operational, according to Harare-based newspaper, The Standard.

It quoted an official from the Zimbabwe Chamber of Mines as saying that over twenty-five major mines are threatened with closure, in addition to numerous small-scale mines dotted across the country.

Incoming ZCM president James Maposa said that a severe shortage of foreign currency is crippling the industry which depends on materials imported mainly from South Africa.

“We are facing a crisis right now. Unless we are able to get more foreign currency to import more materials we can foresee big problems for the mining industry,” Mr Maposa said.

Gold producers are not permitted to hold receipts in foreign currency accounts because they are not direct exporters, but are obliged to sell through the Reserve Bank of Zim-babwe and are paid in Zimbabwe dollars at the official rate of exchange.

Unlike other mineral exporters, the industry does not have any foreign currency under its control to enable it or its suppliers to import essential materials such as cyanide, explosives, and heavy machinery for exploration.

Gold is the second largest foreign currency earner in the country after tobacco.

The newspaper claimed that, in the past year, the country produced over twenty-five tonnes of gold worth Z$9.44 billion.

Mr Maposa said this year the industry could rake in as little as Z$2 billion if the situation did not improve.

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