Zimbabwe’s platinum producers are facing a tough time due to the global decline in platinum prices. This has prompted them to lobby the government for an increase in the amount of foreign currency they can retain from their earnings.
According to Minister of Mines and Mining Development, Minister Zhemu Soda, companies have submitted proposals requesting a higher foreign currency retention threshold.
Currently, local exporters retain 75% of their export earnings and surrender the rest to the government at the official exchange rate
The softening of platinum prices puts a strain on the industry, a significant contributor to Zimbabwe’s foreign currency earnings. Platinum group metals (PGMs) are used in catalytic converters and various industrial applications.
This downturn has resulted in Zimplats, the largest platinum producer in the country, reporting losses for the first time since 2009. The Chamber of Mines of Zimbabwe is urging the government to intervene by reducing electricity tariffs and tax relief for platinum miners. This would help ease the financial burden and potentially prevent mine closures.
Global platinum prices as of today, April 3, 2024, are around $900 per ounce, which is significantly lower than the usual prices that hovered around $1,100 per ounce in the past few years.
This price decline is a major concern for Zimbabwe’s platinum sector, and the requested policy change is being closely watched by the industry to see if it will help alleviate the financial strain.
Ends ///Irene Moyo