Saturday 18 June 2022


GOVERNMENT’S Gold Incentives Scheme (GIS) has come under scrutiny amid indications it is largely benefitting politically connected persons, mainly President Emmerson Mnangagwa’s close ally Pedzisayi “Scott” Sakupwanya – a Zanu PF councillor – and his Better Brands Jewellery (BBJ) company which pocked US$460 million in revenues last year at the expense of artisanal and small-scale miners.

While Sakupwanya is minting money through gold, artisanal and small-scale miners are struggling to survive. They say they are not reaping the rewards of the government’s much-hyped gold incentives.

Gold is central to Zimbabwe’s economic fortunes and politics. Those who know the sector’s ins and outs – its labyrinth of structures and dynamics – say whoever controls that industry runs the country.

It is not just a source of livelihood for thousands, but also a feeding trough for the politically connected and a centre of crony political patronage for Zanu PF and its shadowy economic networks.

The incentive scheme, which was introduced early last year to boost gold deliveries to Zimbabwe’s sole authorised gold buyer, Fidelity Printers and Refiners (FPR), has left artisanal and small-scale operators at the mercy of big gold buyers who are making a killing at their expense.

This comes against reports that Zimbabwe continues to lose US$100 million a month through gold smuggling.

Development experts say if the country was well-run and managed, the abundant gold alone could form the basis of an economic rise, while its valued-added chains of production and cross-chain activities could become a catalyst for progress.

City states like Singapore and other Asian Tigers became economic giants without the natural resources that African countries like Zimbabwe are endowed with. They only had vision, leadership and development plans.

Last year, Zanu PF councillor Sakupwanya’s Better Brands Jewellery pocketed US$460 million after delivering more than seven tonnes of gold to Fidelity, a move that saw him being named the Best Gold Buyer of the Year at the recently held mining industry awards at State House in Harare.

Sakupwanya, who is also chairperson of the National Gold Buyers’ Association, an affiliate of the controversial Henrietta Rushwaya-led Zimbabwe Miners’ Federation, has close links with Mnangagwa and his children, as well as other politically connected elites.

Rushwaya, who was arrested in October 2020 trying to smuggle 6kg of gold to Dubai, is related to Mnangagwa and is a major dealer in the gold business.

A delivery of 20kg of gold within a period of 30 days is eligible for a 5% incentive, a tonne 7% and one to three tonnes 9%.

According to Reserve Bank of Zimbabwe governor John Mangudya, Fidelity received a total of 29 629.61 tonnes of gold, 18 470 tonnes of which came from small-scale miners.

“A total of 29 629.61kg of gold was delivered to Fidelity Gold Refinery in 2021. Large gold producers delivered 11 159kg, whilst small-scale producers contributed 18 470kg,” Mangudya said.

“Small and large gold producers have delivered a total of 29 629,61kg of gold to Fidelity Gold Refinery (FGR) in 2021, a 55,5% increase from the 19 052,65kg delivered in 2020.”

The Reserve Bank of Zimbabwe has hailed the GIS introduced by the government for increasing the precious mineral’s output and deliveries by 55.5% after recent years of successive decline in production. Small-scale miners also maintained the lead in production ahead of large producers.

However, a survey by The NewsHawks revealed artisanal and small-scale miners, who constitute a bigger percentage of Zimbabwe’s current gold deliveries, are receiving between one to 1.5% from the current gold incentives, with some getting nothing at all.

“We just hear that gold buyers are given an extra 5% when they deliver our gold to Fidelity. No one that I know is given that extra money after our gold is sold. We are usually given beer and permission to mine peacefully without hinderances from other mining gangs that control the claims as incentives,” Bruce Chimbwanda, an artisanal miner based in Mazowe, said.

In Zimbabwe, the majority of the working population can be found in the informal sector. And in mineral-rich areas of the country, people are continuously risking their lives digging underground in search of gold, hoping to make enough money to take them out of poverty. NewsHawks


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