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

To: Enigma who wrote (36543)	7/5/1999 11:54:00 AM
From: john mcknight	Respond to of 116756

Mbeki Slams Decision To Sell Gold July 5, 1999 DURBAN, South Africa (PANA) - President Thabo Mbeki has reacted angrily to Britain's decision to sell off substantial amounts of its bullion reserves, saying a further reduction in the international gold price will place a major pressure on South Africa's gold mining industry. Mbeki, who opened the ninth annual Southern African Economic Forum in Durban on Sunday, said the first British gold auction scheduled for Tuesday would hurt efforts to strengthen the weak economies of southern Africa. The South African gold mining company has warned that the proposed sale of IMF gold reserves will undermine the current fragile gold market and place further downward pressure on gold price. The 30-dollar an ounce slide in the gold price since the UK Treasury announced in May that it would sell more than half of its gold reserves has cost South Africa an estimated 600 million US dollars in lost annualised export earnings. ''The mere announcement by Great Britain that it will reduce its gold reserves over time, immediately produced a very negative effect on the price of gold. This has threatened the viability of various gold mines and created a potentially disastrous effect on our economies,'' Mbeki said. Mbeki also criticised the proposed sale of 10 million ounces of gold by the IMF to finance debt relief for poor countries. ''We do not believe that it can be correct that we seek to solve one problem by creating another, focused on undermining our efforts at strengthening our growth and development capacities,'' Mbeki said. However, it was not all doom and gloom. South Africa's newly-elected president said the latest Gross Domestic Product figures confirmed the resilience of the country's economy. ''This is underwritten by a process of restructuring of our economy which has responded well to such pressures as the lowering of tariffs, deregulation, changes in the subsidy regime and, generally, the rapid insertion of ours into the world economy.'' Mbeki told delegates at the World Economic Forum-sponsored summit that his government would continue to modernise the economy and make it internationally competitive. He said the government will also maintain its stance on macro-economics, to ensure the long-term health of the economy. Trade and industry minister, Alec Erwin, said negotiations to create a regional free trade deal were on track but cautioned that difficulties still lay ahead.