Zimbabwe Revises Gold Royalty Framework After Heated Debate

Zimbabwe amends its gold royalty regime after parliamentary debate, limiting the 10% rate to prices above US$5,000 per ounce to balance revenue goals with investor confidence (image source)

HARARE — Zimbabwe’s Parliament has approved a revised budget bill that adjusts the royalty framework for gold producers, easing earlier proposals that had raised concern among miners and investors.

Finance Minister Mthuli Ncube, who presented the 2024 National Budget, had initially proposed doubling the royalty rate to 10 percent for gold sold above US$2,501 per ounce. Following extended debate in the National Assembly, Ncube announced amendments under which the 10 percent royalty will only apply if bullion prices exceed US$5,000 per ounce. For gold priced between US$1,200 and US$5,000, the royalty rate will remain at 5 percent. Small-scale miners will continue to pay reduced royalties of up to 2 percent, a measure intended to support artisanal producers who account for a significant share of national output.

The revision follows warnings from mining companies that higher royalties would erode profitability and discourage new investment. Caledonia Mining Plc, which operates the Blanket Mine producing about 80,000 ounces annually, cautioned that the proposed increase would negatively affect margins and could undermine development of the US$500 million Bilboes project, expected to become Zimbabwe’s largest gold mine.

Gold output reached 42 metric tonnes in the 11 months to November 2025, surpassing the previous record of 37 tonnes achieved in 2024. The performance highlights the sector’s growth potential, but industry groups argue that fiscal certainty is critical to sustaining momentum and attracting capital. Analysts say the revised royalty framework reflects an attempt to balance government revenue ambitions with the need to preserve investor confidence.

Defending the changes, Ncube said inflationary pressures and currency volatility had previously reduced the real value of government revenues, making adjustments necessary. He argued that the new thresholds provide clarity and predictability for producers while still allowing the state to benefit from exceptionally high gold prices.

Industry associations welcomed the revision but called for continued engagement between policymakers and stakeholders. Mining executives say Zimbabwe’s ambition to consolidate its position among Africa’s leading gold producers will depend on stable, competitive fiscal policies. While the revised regime has eased immediate tensions, its long-term success will be judged by whether it supports sustained production growth and renewed investment in the mining sector.