The Zimbabwe Government will crack down on gold smuggling and will monitor mineral exports to protect its national reserves, which are now expected to strengthen the new gold-backed ZiG currency.
Vice President Constantino Chiwenga announced this crackdown during the International Business Conference held on Wednesday at the 64th edition of the Zimbabwe International Trade Fair (ZITF) in Bulawayo, stating that every gram of gold must be accounted for.
The conference ran under the theme: Innovation: The Catalyst to Industrialisation and Trade.
Chiwenga said the government would put strict measures that would see heads rolling if gold that was mined was not accounted for to safeguard national reserves that were to bolster the ZiG currency.
The VP added that the new gold-backed ZiG currency would stay “forever” to guarantee exchange rate stability and foster industrialisation.
Gold smuggling occurs mainly in the artisanal gold mining sector, which reportedly produces around 60 percent of Zimbabwe’s gold.
Initially providing livelihoods to rural communities, the sector has been hijacked by political elites, who now harvest the artisanally mined gold for their enrichment.
Last year, a four-part investigation by Al Jazeera’s Investigative Unit -The Gold Mafia – revealed a series of gold smuggling gangs led by top government officials in Zimbabwe helped criminals launder hundreds of millions of dollars, enriching themselves while plundering resources in the country.
During the conference, Chiwenga said the government would implement tougher measures to safeguard its gold.
“Every gram of gold must be accounted for. We need our gold because it was God-given. No one came with the gold to Zimbabwe but it’s in our soil. If we don’t want to mine it, it will stay there but no one should touch it,” said the VP.
“So all our money we are talking about here – the ZiG – is going to be anchored firmly by our gold and we will get it from all our resources. Just now we are soon going into gas and oil and that will be turned into gold. Our ZiG is not like any currency, it’s firmly controlled and it should be like that.”
The VP said a stable macroeconomic environment is critical in harnessing innovation towards full industrialisation and trade, not the exchange rate-induced instabilities that have engulfed the Zimbabwean economy.
“This is why the government through the Central Bank has introduced a structured currency, the Zimbabwe Gold (ZiG) and ZiG is there to stay forever,” Chiwenga said.
Chiwenga noted that “at all times,” the new ZiG currency had to be anchored and fully backed by a composite basket of reserves comprising foreign currency and the country’s “God-given minerals” which was predominantly gold.
“This bold step symbolises the government’s unwavering commitment to the dedollarisation programme premised on fiscal discipline, monetary prudence and economic revitalisation,” he said.
“When we talk of predominantly gold, we can’t keep tonnes of ore in the central bank or chrome, or iron, or lithium or platinum, we will sell them. But we have our gold and every gram of gold shall not leave Zimbabwe.”
The Al Jazeera investigation showed how gold smuggled from Zimbabwe makes its way to Dubai and, according to experts in money laundering and illicit trade, is then exported to other major gold hubs like Switzerland and London.
These transfers are possible because gold is melted and refined repeatedly, a process that obfuscates all traces of its origin, making it particularly difficult for law enforcement agencies to build evidence against suspected smugglers.
Is it corruption which is God given or looting…