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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: Alex who wrote (35715)	6/23/1999 1:59:00 AM
From: Tomas	Read Replies (1) \| Respond to of 116779

South Africa lobbies against IMF gold sales - Financial Times, June 23 By Victor Mallet in Johannesburg South African gold-mining companies and trade unionists yesterday joined forces to lobby against proposed gold sales by the International Monetary Fund. They warned that tens of thousands of miners would lose their jobs at unprofitable shafts if the gold price did not recover. The IMF's plans to sell up to 10 per cent of its gold reserves to fund debt relief for poor countries has provoked bitter responses from gold-producing companies and countries. Many of the poorest nations are gold exporters, and the gold lobby argues that the damage done by falls in the gold price - as a result of planned sales by the IMF, the UK and others - has already outweighed the benefits of debt relief. South Africa is not one of the poorest debtors, but it is the world's biggest gold producer and has been hard hit by the weak market. "If the price remains at $258 an ounce, 40 per cent of our gold production will become unprofitable," said a joint statement from Bobby Godsell, president of the Chamber of Mines, and James Motlatsi, president of the National Union of Mineworkers. "This will confront more than 80,000 people with the loss of their jobs." They added: "If the sale of IMF gold causes a further $30 drop in the price, another 100,000 people in southern Africa will become unemployed, and the million people dependent on them will be plunged into poverty." South African gold mines employ about 300,000 people and have already made thousands redundant in recent years because of cost-cutting and restructuring. Mr Motlatsi and Mr Godsell, who is also chief executive of AngloGold, the world's biggest gold mining company, are in Washington to lobby the US Congress against the planned IMF gold sales. They say that more than three-quarters of the 41 so-called "highly indebted poor countries" targeted for relief by the IMF are gold producers, and gold plays a vital role in the economies of a quarter of them. Mining, furthermore, has been one of the first industries to respond to recent "investor-friendly" economic reforms. "In Africa alone, mineral exploration investment in the past decade increased by 500 per cent, to stand at nearly $700m in 1997, a large part of it directed at gold," Mr Motlatsi and Mr Godsell said. Last week, the World Gold Council said the IMF's plans were flawed. It called on all official holders of gold to consider the consequences for poor gold-producing countries when planning sales of their reserves.