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17 February 2012 | Adam Leach
Mining firm African Barrick Gold is training local workers in order to address inflation in the global labour market.
The company, which operates four gold mines in Tanzania and is listed on the London Stock Exchange, reported a 25 per cent increase in revenues yesterday as a result of a rapid rise in the price of gold over 2011. However, despite higher demand for the metal it had to contend with inflated prices.
In a statement to accompany the company’s results, CEO Greg Hawkins, said: “The rapid increase in the price of gold and the number of new projects coming on-stream across Africa has introduced considerable inflationary cost pressures across our industry.”
The company said increased raw material prices contributed to higher costs, although more expensive labour rates were the main factor. African Barrick Gold said increased demand across the industry had led to wage-rate inflation with skilled international labour in demand across the world.
In response the company plans to improve the capability of the local workforce close to its mines to insulate it from the impact of rising international labour costs.
A report last year by the World Gold Council found that a record $25.6 billion (£16.1 billion) was spent on gold in the third quarter of last year. It said as a result of the high prices, dentists were forced to look for cheaper materials to make replacement teeth.