Published On: Fri, Dec 2nd, 2016

Govt settles Zimplats debt

Share the article below

Beaven Dhliwayo

Harare  – The Zimbabwe government has issued three Treasury Bills (TBs) to settle a $34 million debt that it owed platinum miner, Zimplats, the company announced on Thursday.

The TBs of $11. 376 million each, have an annual interest rate of five percent and mature on October 31, 2019, 2020 and 2021 respectively.

Zimplats was owed $34 million by the Reserve Bank of Zimbabwe (RBZ), but the government assumed the debt following the promulgation of the RBZ Debt Assumption Act in August 2015.

The Act provided for the assumption by the State, of certain debts incurred by the RBZ, subject to those debts having been validated and reconciled by the Ministry of Finance and Economic Development.

“Zimplats wishes to announce that the $34 million has been validated and reconciled by the Government of Zimbabwe’s Ministry of Finance and Economic Development and that the Government of Zimbabwe has now issued to the operating subsidiary three Treasury Bills with a total nominal value of $34 million in settlement of the principal amount owed by the RBZ,” it said.

The money was lodged with the RBZ during the Zimbabwe dollar era and was to be withdrawn in the local currency to fund local costs.

However, the Zimbabwe dollar ceased to be functional in 2009 when the country adopted the multi-currency regime, but the Central Bank has been failing to re-fund the money.

Zimplats is one of three platinum producers in the country, along with Mimosa and Unki.

On Wednesday it announced that its board of directors had approved the development of a new $264 million underground mine, which will raise its mineral reserves by a third to 9 million ounces.

Preliminary work on the new mine, the Mupani, started in June this year.

The new mine will add to the four underground mines Zimplats currently operates, namely Rukodzi, Ngwarati, Bimha and Mupfuti.

Zimbabwe has the second-largest known platinum deposits after South Africa.