No bond notes to pay small-scale gold miners

Source: No bond notes to pay small-scale gold miners – NewsDay Zimbabwe January 3, 2018

FIDELITY Printers and Refiners (FPR) will no longer pay 40% of gold deliveries from small-scale gold miners in bond notes citing the currency’s unavailability on the market, NewsDay has learnt.

BY MTHANDAZO NYONI

Under the new arrangement, miners will continue to receive 60% of their earnings in United States dollars, while the remaining 40% will be paid through bank transfers.

Before the new arrangement, small-scale miners used to receive 60% in US dollars on delivery of the mineral and 40% in bond notes.

In a notice to small-scale miners on Saturday, FPR customer relations officer, Bhekilizwe Manyathela said: “Please note that due to the non-availability of bond notes, we have been instructed to stop bond note accruals and, instead, do bank transfers for the 40% component.

“For those whom we already owe, we kindly urge you to also adopt the bank transfer system until such a time as when we are able to provide bond notes.”

Zimbabwe Miners’ Federation spokesperson Dosman Mangisi said the move was going to hurt operations of small-scale miners.

“It is a crisis because the majority of small-scale miners are in remote parts, where there are no services of plastic money. Also, there is a three-tier system of pricing by suppliers and manufacturers. All this disadvantages miners,” he said.

“Banks must also tap the gap (sic) in remote parts where miners are mining. In places like Inyathi, Shangani, Fort Rixon and Maphisa, there are a lot of miners, in their hundreds, but [there are] no banking services and the shops around don’t use swipe facilities, making life difficult for small-scale
miners.”

Small-scale miners across the country on Saturday condemned the move, saying they could not thrive in such a scenario.

“Most of these suppliers need cash upfront and US dollars. We strongly recommend that the authorities concerned from the Mines and Finance ministries and so on compare notes and come up with lasting solutions to the cash crisis,” one miner said.

Paying the miners in US dollars and bond notes was meant to incentivise miners to increase gold production, as they account for close to 45% of Zimbabwe’s bullion production.

Now, with the new arrangement, artisanal miners may no longer be incentivised enough to continue delivering gold to FPR, which could risk sending them to the black market.

Gold is one of Zimbabwe’s largest sources of foreign currency.

 

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