Miner demands $92 million from RBZ in lawsuit -document

Harare – RioZim Limited is demanding $92 million from the Reserve Bank of Zimbabwe central bank in a lawsuit brought to force the Reserve Bank to pay for more of its gold purchases from the company in U.S. dollars, court documents showed.

Gold miners sell all their gold to the central bank’s subsidiary Fidelity Printers and Refiners, which then exports it.

Miners are struggling as Zimbabwe struggles with foreign currency shortages, and Rio Zim shut down its three mining operation in the country saying it was not able to continue with production.

However, the miner announced that it has resumed operations within its three gold subsidiaries namely Cam and Motor in Kadoma, Renco Mine in Masvingo and Dalny Mine in Chegutu after reaching terms with the RBZ over foreign currency allocations.

The miner announced that since 2016 the central bank only paid for 15 percent of gold it purchased from the company in dollars, breaching its policy to pay for 30 percent in the U.S. currency.

The miner first announced on October 9, 2018 that it would take legal action against the central bank, signalling impatience by miners over the dollar shortages.

In its summons filed with the High Court dated Nov. 14, RioZim says it failed to receive $48 million due in payments from the central bank for its sales in dollars and suffered losses of $44 million due to lost production.

“The plaintiff suffered a direct loss of money and the devaluation of the purchasing power of its earnings …,” RioZim said in the court papers.

The company added that, “…failure to receive dollar payments left it unable to import equipment and materials for capital projects, putting its operations in jeopardy.

On Monday, in a change of policy, central bank Governor John Mangudya and the deputy minister for mines Polite Kambamura said the government would allow gold, platinum and chrome mining companies to retain up to 55 percent of their earnings in dollars, up from 30 percent, a move they say is meant at ensuring operators remain viable.

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