N e w s

Just recently gold producers were struggling to gain more independence from the state. Now they seem to want to go back to strict federal control. The idea is very likely to be the basis of the new development policy of the industry.

Russia needs a special state institution that will exercise control over the gold mining industry. The statement was made at the conference "Russian Gold Mining Industry on the Threshold of the Third Millenium. Problems and Prospects" by the chairman of the Russian Gold Miners Association Victor Tarakanovsky. In his opinion, the Department of Precious Metals and Stones specially created by the Economy Ministry does not carry out its task very well.

The opinion presently shared by analysts is that the gold industry is almost in stagnation and the only market of precious metals that operates in Russia is the "wild market".

The head of Russian miners believes that imposing of state control in the gold mining industry will lead to the increase of the output. This done, the producers will be able to operate without appealing to foreign investments which in fact had failed the expectations. The largest mining corporations consider Russia one of the least investment perspective regions, so we cannot expect any significant investments to be made in the next 3-5 years.

The miners' hope is that the state will partially revive precious metal purchase by Gokhran with the system of mining pre-payments. The market participants also insist on bringing down taxation rates for gold mining enterprises by 25-30% and on precious metal mining projects taking a more active part in the output sharing agreements.

Another dream of gold miners consists in organizing an exchange trade of precious metals. It is now difficult to speak of creation of such exchanges, though. Several problems contribute to that. First, precious metals are still not considered a commodity, being called a "currency valuable". Secondly, there is doubt as to what exactly institution should have control over such exchanges - all involved offices want to be sole controllers. Meanwhile, the CBR is organizing an interbank market of precious metals with no help of an exchange. All the operations will be handled through clearing banks.

Many of the above requirements will be realized in the "Development and Reforming Policy for Russian Gold Mining Industry in 2001-2005 and up to 2010", already under consideration by the Economy Ministry. However, there is no budget money allocated to the development of the policy. The resources will be provided by a special non-budget fund. Thus, the Department of Precious Metals and Stones will first of all consider the sponsors' suggestions concerning the "Policy", said Yury Katsman, deputy director-general of a research and technical center Almazzolotoprogress.

With such approach the main thing is not to sell too cheap. It may even make sense to open a tender so that all interested can compete in making a decisive suggestion.

Maria IGNATOVA

Source: Izvestia