HARARE (AFP) — Zimbabwe's largest gold mining firm has stopped operations at its five mines across the strife-torn country, resulting in 5,000 people losing jobs, an official said Thursday.
The closures resulted from long delays in receiving payments for gold delivered to the Reserve Bank of Zimbabwe, which has a monopoly on the country's gold trade, Collen Gura, chief executive officer for Metallon Gold told AFP.
"We have no mine which is operating at the moment," he said.
"We cannot continue to produce when we are not getting paid, so there are no operations at any of our mines across the country," said Gura.
Metallon Gold, which produces 40 percent of the country's gold output, is owned by South African mining mogul Mzi Khumalo.
Gura added that it did not make business sense to borrow money from commercial banks "as we are being asked to pay 9,500 percent per annum, which is not sustainable to any operation."
According to the Chamber of Mines, Zimbabwe's gold production plunged by 61 percent to 295.57 kilogrammes (652 pounds) in March, compared to February this year.
Average monthly gold production has declined from 2,259 kilos in 1999 to 267 kilos, said the Chamber.
Gold contributes 35 percent of Zimbabwe's total foreign currency earnings.
The Chamber of Mines said the Reserve Bank of Zimbabwe (RBZ) owes gold producers 30 million US dollars (23.3 million euros) in unpaid fees, dating back to end of 2007.
"The failure by the RBZ to pay for gold delivered to it has decimated the entire gold industry," the organisation said in a statement.
Gold has traditionally been one of Zimbabwe's main foreign currency earners, but the mining sector has been crippled in recent months by power cuts, shortages of foreign currency and the exodus of experienced personnel.
The southern African nation, currently gripped by a post-election crisis, has been ravaged by hyperinflation which shot up to 321 million percent on October 9, along with a high unemployment rate and food shortages.
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