The Reserve Bank of Zimbabwe (RBZ) through its wholly owned gold purchasing subsidiary, Fidelity Printers and Refiners has paid part of the debt due to gold producer; Rio Zim but the miner insists the installment is rather “insignificant’.
Last month, Rio Zim announced that it had stopped production at its three mines due to late payments for deliveries made to Fidelity which has left the company struggling to meet operating expenditure.
However, in a statement this morning, the company confirmed receipt of an “insignificant” and undisclosed payment from the Central Bank.
“Shareholders are advised that the Company has received an insignificant part payment towards the USD and ZWL amounts due to it from Fidelity Printers and Refiners for gold deliveries made. Discussions regarding payment of the long overdue sums are still in progress between the Company, Fidelity Printers and Refiners and the Reserve Bank of Zimbabwe,” the company said.
It is alleged that Rio Zim is owed US$2.46 million and ZWL$ 65.48 million for gold delivered to Fidelity.
“It is the Company’s hope that the issue can be resolved expeditiously to capacitate the Company to meet its operational expenditure requirements. It should be noted that there is no dispute between the Company, Fidelity Printers and Refiners and the Reserve Bank of Zimbabwe as to the amounts payable. Fidelity Printers and Refiners is a 100% owned subsidiary of the Reserve Bank of Zimbabwe and accordingly the Company is confident that payments will be received eventually but delayed payment is placing enormous financial stress on the Company,” it further stated.
RBZ was not available for comment regarding the development.
This is not the first time that Rio Zim and Fidelity have brushed shoulders, following a 2018 incident when the gold miner accused Fidelity of late payment amounting to US$ 92 million, a figure denied by both Fidelity and RBZ.
The case is still ongoing at the courts.
Analysts have castigated Central Bank for delaying payments to gold producers at a critical time the country is in dire need of foreign currency generation from the sector.
The development has led to an increase in smuggling and sale of the country’s mineral resources on the black market by small scale miners where payments are speedily processed.
For big miners, late payments for deliveries have hampered operations.
“The company has therefore been forced to stop production of bullion due to its inability to buy essential consumables and spaces and is actively placing all its gold mines on care and maintenance until a viable solution is found,” RioZim said last month.