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ZCCM-IH to spell out open market gold buying rules this week

Zambia’s mining investment firm ZCCM Investment Holdings has announced that it has started buying gold from artisanal and small-scale miners across the country in what is seen as a follow up move to formalize gold mining and trading that has been happening in some parts of the country.

In an advisement circulated on March 6, 2019, ZCCM – IH is providing an open market and competitive prices for the gold hence gold sellers across the country are encouraged to take their gold to the firm for sale, but no further details have been availed.

ZCCM-IH had last year in December announced that it would set up centers for buying gold in strategic areas with deposits as a first step towards bringing artisanal and small-scale miners into the formal market.

When the Zambian Business Times – ZBT reached out to the mining investment firm, its Public Relations Manager Loisa Kakoma stated that the company is planning to hold a press briefing on the matter during this week where they will share more details on how the whole operation will be carried out.

ZCCM-IH buying of gold has also been linked to the central bank (Bank of Zambia – BOZ) which had in December 2019 announced that it is in the process of resuming the buying of gold to serve as an alternative to forex reserves.

The Bank governor Dr. Denny Kalyalya told ZBT in an exclusive interview back then that the move is a way of diversifying from the risk of only relying on holding of the US dollar reserves which is currently the main forex reserve held.

The BOZ governor however did not disclose the target value of gold reserves to bought and stock piled in 2020 stating that discussions with suppliers and modalities are still underway.

According to a research done by ZBT, gold reserves would complement the current US dollar held reserves which are now mostly generated from minerals royalties levied on copper exports. Gold reserves would become more efficient to stock pile as they would be bought using local currency with the country leveraging the current mining at existing large scale copper and gold mines at Kansanshi and Lumwana.

Other areas reported to have notable gold deposits are Mwinilunga in the North Western Province, Mumbwa and Luano in Central province, Rufunsa and Luangwa in Lusaka province and Petauke in the Eastern Province.

Government has indicated that Zambia aims to produce 40,000kg of gold in 2020 alone from primary and secondary sources including artisanal and small-scale miners.

Source: Zambia Business Times

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