Mines Engage Biti Over Funds

Mines have sought the intervention of Finance minister Tendai Biti in a bid to recover funds misappropriated by the central bank over the years, businessdigest can reveal.

A Chamber of Mines letter seen by this paper sent to Biti appealed to the Finance minister to find ways of “expediting the payment of all funds outstanding to” its members.
Early this year the Reserve Bank owed a cumulative US$30 million to gold mines going as far back as 2007 forcing most mines in the sector to shut down operations.
A handful of mines have resumed operations this year but output is still very low.
The letter reads: “Our members are saddened by the fact that at a time that mining should be growing and contributing more towards government revenue, mining companies are struggling to raise working capital to recapitalise and expand production, while they are owed substantial amounts of money by the Reserve Bank of Zimbabwe.”
The chamber says RBZ governor Gideon Gono converted its members’ funds to other uses without the permission of the companies. This, the chamber believes has worsened the situation mines have found themselves in.
“There have been many statements in which government ministers have lamented the low contribution of mining to the fiscus at the moment. However, this assertion ignores the fact that over a long period, the RBZ converted foreign currency accounts  belonging to companies to its own use without the consent of the concerned companies.
At the time that the RBZ was converting the funds to its own use, the chamber did highlight the fact that there was a price to be a paid in future as companies were being deprived of money to keep exploration, development and capital replacement going which would inevitably translate into very low productions and therefore low revenues to the fiscus in future.”
The letter was also copied to Mines Minister Obert Mpofu.
Gono this year admitted converting millions of account holders’ funds to  RBZ’s use to keep the economy pumping.
But gold mining group, New Dawn managed to convert a US$2 million central bank bond into cash this
month through a financial
institution.
Prior to the freeing of the gold industry this year, the central bank through its subsidiary Fidelity Printers was the sole buyer of gold in the country. Gono says an acute shortage of foreign currency forced the central bank to convert funds to pressing national requirements. 
But since the formation of the unity government this year, the bank has been unable to meet any of its financial obligations.

 

Chris Muronzi

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