Of late, RBZ’s gold buying unit, Fidelity Printers has been failing to pay small scale gold miners. But yesterday the Governor confirmed that they have found a way to ensure steady payments to gold miners.
And in the process, the RBZ also increased it’s ratio of foreign currency payments to the miners, which will likely stimulate miners to increase production. Dr. Mangudya says the knock-on effect of such a move is the stabilization of the exchange rate.
“The challenge has been resolved. We have found a sustainable solution to manage the availability of cash to be used to purchase the gold.
The immediate benefit of paying in US dollars is that there would less creation of Zimbabwe dollars to purchase the gold, which means less pressure on the exchange rate.
Less pressure on the exchange rate translates to its stability which result in price stability.”
The Governor hopes the increased supply of forex on the black market through payments to miners will gradually stop the depreciation of the Zimbabwe dollar as the price of buying forex declines.
Zimbabwe dollar’s depreciation has become something of a phenomenon which the Governor seems to be failing to put a finger on given the growing list of factors attributed to the depreciation.