Gold News

Gold price could be boosted as Zimbabwe output plunges

The Chamber of Mines has confirmed that year-on-year output at gold mines in Zimbabwe slumped by 44 per cent in the first seven months of 2008.

Blaming a combination of power cuts, overvalued currency and payment delays from the central bank, the organisation said that output decreased to 2,624kg between January and July.

This figure - which compares to the 4,686kg recorded for the equivalent period in 2007 - could provide encouragement to anyone who has formulated plans to buy gold.

A statement from the chamber read: "Issues of concern include delays in paying gold producers their US dollar revenue.

"Data at hand indicate that there are some producers that have not been paid for deliveries made in 2007."

The severity of the problem can be assessed by considering the fact that gold accounts for a third of Zimbabwe's export earnings following the collapse of the commercial agriculture industry.

The mining sector in the country has been hit by last year's incorporation of an empowerment drive which forced mines to sell 50 per cent of their shares to locals.

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