The ManicaPost
Kudzanai Gerede Business Correspondent
Ever since Government undertook its decision to take over the diamond mining operations in Marange through the consolidation of the mining companies earlier this year, there is renewed optimism towards transparency and accountability in the handling of the country’s diamond sector following sales of US$ 21.5 million in the first 3 months to June.
Subsequent to formalisation of mining operations in Marange area in 2009, Zimbabwe’s diamond gems have not contributed meaningfully to Treasury under the seven joint-venture companies which prompted Government to cease renewing mining contracts once they had expired.
However, the consolidation of mining firms has gathered hostile tides against Government with the Western sponsored voices both local and external calling for the ousting of the country from the global diamond watchdog, the Kimberley Process Certification Scheme (KPCS).
At the turn of the millennium, the same elements succeeded in the ousting of the country from the KPCS citing purported human rights violations and this led to a ban on the sale of Zimbabwean diamonds at various international auction floors.
Analysts say that the ban on the sale of local gems inflicted huge economic losses at a time when Zimbabwe’s agro-based economy was going through a transitional period (land redistribution) which affected agricultural productivity.
Following concerted efforts to rejoin the KPCS, Zimbabwe was readmitted in 2011 and the sale of diamonds has contributed to the fiscus despite that being only a small proportion of what could have been a huge revenue earner for the economy.
The recent visit into the country on a familiarization tour by the KPCS chair Mr Ahmed Bin Sulayem of the United Arab Emirates has been widely regarded as a confidence booster in the local diamond sector which is still going through a vigorous transformation at a time when negative publicity was being fanned to discredit the transition process.
“The mines in Marange are in one of the best conditions compared to other mines in Africa,” said Mr Ahmed Bin Sulayem after touring the diamond mines on Monday last week.
Mr Sulayem was impressed with the structural developments undertaken by Government in the diamond sector which not only ensured transparency and accountability but value addition for the benefit and improvement of local communities through employment creation.
Zimbabwe has already set up a diamond cutting and polishing centre in Harare and plans to have another one in Mutare which will go a long way in empowering Manicaland communities which is home to diamonds estimated to supply 25 percent of world demand.
Mr Sulayem reassured Government that KPCS position was to ensure Governments have the freedom to make structural designs which suit their respective diamond sectors and the KPCS is only concerned with the security and transparency of the diamonds.
“The visit by the KPCS chair and the positive observations he expressed on the state of our diamond mining operations in Marange have strong influence in our ability to win investment into the country, not only in the diamond sector but in other sectors of the economy,” said Mr Pepukai Chivore, an economist.
“Investment flow follow markets which are safe, transparent and where locals in the host country are also part of. Doubts over the consolidation of mining firms by Government have already been cast aside and the endorsement by the KPCS chair brings confidence into the sector. This is also a consolidation that Zimbabwe will remain in the KPCS,” he added.
However the KPCS chair has reaffirmed his commitment to ensure the local diamond industry just like many in the African region should validate the worth of their diamonds in order to improve revenue as they are being under-priced.
In his recent visit to the United Kingdom Finance and Economic Planning Minister Patrick Chinamasa when asked on BBC’s Hard Talk on how the country had been robbed of the US$ 15 billion as referred to by the President, he outlined under invoicing as the
major hindrance as the actual value of the country’s diamonds are not known by the time they leave the country.
Mr Ahmed Bin Sulayem assured Zimbabwe that the KPCS will organise workshops on validation processes before the November plenary meeting to ensure developing countries are not robbed of their resources.
