By Tendai Kwari
Sorry Minister Tendai Biti you will not get money from diamond sales. There are reports that a Chinese company mining for tantalite in Bikita, Masvingo Province, says it has discovered diamonds in the area.
The discovery of these diamonds could be any country’s salvation…but alas, not in Zimbabwe. We have not seen any major development resulting from the discovery of Marange diamonds.
A report on my desk “Reap what you sow: Greed and corruption in Zimbabwe’s Marange diamond Fields – Nov 2012” sums it all up. Here are some of the facts:
“Since its discovery in 2006, Marange’s potential has been overshadowed by violence, smuggling, corruption, and most of all, lost opportunity. Far from defending the best interests of Zimbabwe, Minister Mpofu has presided over a ministry that has awarded concessions to dubious individuals with no prior mining experience, often under very questionable terms or circumstances.
One confidential geologist report cited by the August 2010 Kimberley Process Review Mission to Zimbabwe claimed “in excess of10,000,000 carats have been removed by artisanal effort over the last three years”—an amount worth almost $600,000,000.
There is the mysterious whereabouts of a 2.5 million carat stockpile that apparently disappeared following the controversial “Kinshasa Agreement” undertaken by the Kimberley Process in November 2011. At least two KP sources admit the stockpile— conservatively valued at almost $200 million—was traded during the embargoed period. While Zimbabwe’s finances suffer, the same cannot be said for bank ledgers of ZANU insiders.
Many top securocrats loyal to President Robert Mugabe and his party, the Zimbabwe African National Union (ZANU), are also, in the parlance of corruption watchers, “eating well.” Civil society sees it differently: diamonds leaking out of any country in such a fashion is not only a loss to the national treasury and public good; it is the ultimate expression of a systemic failure of a country’s internal controls. The smuggling of Marange stones is not a trickle, but a flood.
In 2010 leading industry insiders, including Filip van Loere, a Belgian diamond expert working for the Government of Zimbabwe, predicted annual production estimates of as much as 30-40 million carats if KP export restrictions were lifted. At the current average of $60 a carat, the low end of that estimate would have realized annual sales of almost $2 billion.
Between November 2011 and May 2012 Anjin is believed to have sold approximately $78 million worth of diamonds but, according to Biti, failed to remit any taxes or royalties. The recommendations made on this report are:
Improve Parliamentary oversight of mining contracts – The parliamentary committee on mines and energy should revisit and publicize the terms and conditions of each of the joint ventures approved between 2009 and 2012, including disclosing the ownership structures of the company and individuals who sit on the boards of directors.
De-militarize diamond deals – concerns remain that the role of state security agencies and officials in Marange’s legal and illegal diamond trade greatly increase the prospects of poor governance, off budget expenditures and violence—both within Marange and nationwide. This fear is particular acute as Zimbabwe approaches general elections and a national referendum on a new Constitution in 2013.
Promote transparency – Zimbabwe should enshrine contract transparency for all agreements related to natural resources into its Constitution. Ministries of Mines and Finance should also come to an agreed and publicly disclosed understanding of what each diamond mining company exports on a quarterly basis, and what taxes were collected.
Disclose assets of public office holders – Zimbabwe should undertake to create a mandatory and publicly available registry of assets for elected officials, senior government appointees and their spouses.
Oblige companies to divulge ownership structures – The ministries of Finance and International Trade should consider taking action to force all companies listed and operating in Zimbabwe’s extractive sector to publicly divulge the ownership structure and location of any foreign held trust accounts.
Make Beneficiation Non-Partisan – Beneficiation is allegedly at the heart of a ZANU attempts to “indigenize” the Zimbabwean economy by making all companies 51% “Black” owned. That beneficiation, however, should not be limited to Marange as it otherwise may cause regional divisions and further grievances.
Create an international diamond smuggling profile – Current enforcement efforts are failing to detect and interrupt the flow of smuggled Marange goods. Due to the scale of this trade, the entire diamond supply chain has been, and continues to be, compromised by tainted goods.”
ZANU (PF) has made corruption, cronyism and patronage acceptable. All the ills bedevilling Zimbabwe are going unchecked because we have been conditioned to accept that it is the norm.
What saddens me is that the Zimbabwean diamonds and their proceeds end up in Western, American and Asian bank vaults. The Zimbabwean child has got no books. There is no medicine in our hospitals. The country infrastructure, since built by Ian Smith is now derelict and there is “no money to rebuild”.
ZANU (PF) rhetorically bleats “Zimbabwe will never be a colon again! Zimbabwe will never be a colon again”; yet our God given natural resources are being siphoned out of the country day and night.
Unfortunately, some of the money from the diamonds is going to be used in funding violent activities during the impending elections. ZANU (PF) is rich…but Zimbabwe, rich in mineral resource is financially poor. For 33 years we have allowed this decadence to unfold, yet we are the custodians of our history and heritage.
