Emergency Negotiations by Zimbabwe Chamber of Mines: Either Retain Full Foreign Exchange or Settle at Market Prices

The Chamber of Mines of Zimbabwe has confirmed that it has initiated a new round of negotiations with the country's Reserve Bank regarding the current foreign exchange retention system. According to the current policy, export enterprises are required to surrender 30% of their export earnings to the central bank at the official exchange rate, while retaining the remaining 70% for themselves.

Isaac Kwesu, the CEO of the Chamber, told the Zimbabwe Independent that there is an urgent need to establish a policy framework that can meet the government's foreign exchange needs while ensuring the financial sustainability of export enterprises. Kwesu emphasized, "The Chamber is negotiating with the central bank to establish an optimal foreign exchange framework that can meet the government's needs while ensuring the normal operation of export enterprises."

The Chamber of Mines specifically pointed out that the widening gap between the official exchange rate and the parallel market rate has led to a significant devaluation of the export earnings surrendered by enterprises. This situation not only squeezes the working capital of enterprises but also weakens the mining sector's ability to import critical supplies such as machinery equipment, spare parts, and consumables.

Industry executives have currently put forward two demands: either allow enterprises to retain their full export earnings or use the market exchange rate to calculate the surrendered amount. Some stakeholders have also proposed restarting the offshore retention account system to safeguard export earnings and improve foreign exchange access.

As Zimbabwe's most important foreign exchange-earning industry, mining contributes over 75% of the country's total export revenue.