Extractive justice activist, Farai Maguwu has estimated that Zimbabwe could be losing in excess of US$20 Billion to illicit financial flows especially in the mining sector.
Maguwu who heads the Centre for Natural Resources Governance (CNRG) said Zimbabwe has at least 500,000 full-time artisanal miners involved in gold and diamond mining which feeds into the black market.
“We now have thousands upon thousands of small-scale mines that do not remit anything to Fidelity, or at the very least, just remit a minute fraction for compliance. FPR pricing regime also promotes smuggling. Then we move to small-scale miners. This is where much of the leakages occur. The majority of these are ruling party-affiliated and hence enjoy impunity. The Chinese also fit in this category.
Maguwu also accused the Chinese of smuggling gold out of the country after coming to Zimbabwe on tourist visas.
“Most Chinese come on tourist visas and are assisted to regularize their stay by local claim owners who need their cash and equipment to scale up operations. The local guys then assist the Chinese in smuggling so they can maximize profits. The number of unregistered small-scale mines is rising,” he said.
Maguwu said smuggling within the gold sector is unmitigated due to the fact that small scale miners have their own mills where production takes places non-stop.
“It is hard to quantify gold mined and smuggled by small-scale miners. The majority have their own mills, and production is non-stop. If based on the assumption above, artisanal miners can produce gold worth $12.6 billion annually, then small-scale miners can produce more. Thus gold from artisanal and small-scale mines alone can surpass $20 billion,” he added.
Maguwu cited the case where Zimbabwe Miners Federation leader Henrietta Rushwaya was arrested at the Robert Gabriel Mugabe International Airport while attempting to smuggle six kilograms of gold out of the country.
“There is a Miners Federation whose President was arrested at Harare International airport whilst trying to smuggle gold worth $780,000 to UAE. ZACC is not keen to investigate this organization.
“Five months later someone alleged to be her driver was arrested at OR Tambo on arrival from Joshua Mqabuko Nkomo Int airport with gold worth $730,000. The 2 contrabands give us $1.5 million. Needless to say, this was just a tip of an iceberg. The bottom line is, that our country is wealthy beyond measure. We just need to get our act together, ruthlessly deal with organized crime and everything will fall into place,” said Maguwu.
A parliamentary committee on mining chaired the late legislator, Edward Chindori Chininga released a report which stated that some of the Chinese investors were not even registered with the Ministry of Mines.
According to the report titled, ‘Illicit Gold Markets in East and Southern Africa’, the Global Initiative Against Transnational Organised Crime said that 10 to 30 percent of authorized buyers selling bullion to the state-run Fidelity Printers and Refiners (FPR) were only doing so to keep their licenses.
Global Initiative estimated that about 50 percent of Zimbabwe’s estimated 1,5 million artisanal and small-scale gold miners (ASGM) have been spiriting away the yellow metal.
