Business, Economics and Jobs

Zimbabwe’s stolen diamonds


A private security employee guards on December 14, 2011 a diamond processing plant in the diamond-rich eastern Marange region, where families were expulsed from their house to make way for excavation machines of major mining companies allied to the regime of President Robert Mugabe.


Jekesai Njikizana

JOHANNESBURG, South Africa — The message from Zimbabwe’s first-ever diamond conference was defiant.

Political leaders said mining at the country’s vast Marange fields, a potential source of a quarter of the world’s diamonds, will not be curbed by critics who accuse Zimbabwe of human rights violations and widespread corruption.

The two-day conference was hosted by Zimbabwean President Robert Mugabe in the tourist town of Victoria Falls, and attended by industry experts, government officials and international gem dealers.

Under the theme of “Unlocking Zimbabwe’s Diamond Potential Together,” speakers railed against US trade sanctions and spoke of the successes at Marange.

Mining ministers from South Africa and Namibia touted Zimbabwe’s compliance with Kimberley Process regulations on the diamond trade, even claiming an “overcompliance.”

But such claims don’t line up with a string of recent reports. In one, released the day the conference began, the Ottawa-based Partnership Africa Canada accused Zimbabwe’s government of stealing $2 billion in diamonds from the Marange fields since 2008, using the money to enrich government officials, gem dealers and possibly as a war chest for upcoming elections.

“The theft of Marange diamonds is perhaps the biggest single plunder of diamonds the world has seen since Cecil Rhodes,” the report said, referring to the British colonial mining baron.

“A parallel trade in Marange diamonds continues to thrive, with the full knowledge and complicity of top officials.”

The Zimbabwean mining minister Obert Mpofu, who has control of the state-owned Zimbabwe Mining Development Corporation (ZMDC) that dominates the Marange fields, was singled out in the report.

Mpofu called the report “nonsensical,” while Goodwills Masimirembwa, head of the ZMDC, said the allegations in the report were "totally false."

"No diamonds have ever gone missing," Masimirembwa was quoted by the Associated Press as saying.

But previous reports by PAC and other international groups, including Global Witness, have made similar accusations about Zimbabwe’s diamond trade.

Finance Minister Tendai Biti, a member of a former opposition party that is now in a unity government, has complained several times that diamond revenue isn’t reaching the state treasury.

Biti said in July that while $600 million in diamond revenue was expected this year, only $46 million had been submitted to the treasury. He said he feared "there might be a parallel government somewhere in respect of where these revenues are going.”

Zimbabwe's Marange valley, on the eastern border with Mozambique, is home to rich alluvial diamond deposits that were discovered in 2006. Two years later, Mugabe’s government seized control of the mining areas.

Restrictions on sales of Marange diamonds were imposed in 2009 after reports of brutal violence and human rights abuses by Zimbabwean security forces, including the killing of at least 200 civilians when the military took control of the diamond fields.

The restrictions were dropped in 2011 amid accusations that the Kimberley Process, originally set up in 2003 to prevent trafficking of blood diamonds, had become toothless and needed reform.

Rights groups say that secret sales of Marange diamonds have continued, and profits of millions of dollars from the diamonds are funding Mugabe’s ZANU-PF party, and will be used to bankroll a violent campaign to win upcoming elections.

During the last elections, in 2008, the then opposition leader Morgan Tsvangirai and his supporters were tortured and brutally beaten by Zanu-PF militias. Some 300 MDC supporters were killed during the election period.

With an election to be held in March 2013, the country is already seeing an escalation of political violence.

Of major concern to Zimbabwe’s mining industry are the continuing US sanctions, imposed on the ZMDC and other state-run diamond mining companies because of the Mugabe government’s human rights violations.

Ernie Blom, president of the World Federation of Diamond Bourse, told the conference in Zimbabwe that the US market represents around 40 percent of the world retail trade in diamonds.

“During the past 10 years, the [Kimberley Process] has very successfully eradicated conflict diamonds to almost zero,” he claimed.

Anger at US sanctions boiled over on the last day of the diamond conference, with African delegates demanding that current Kimberley Process chairwoman Gillian Milovanovic resign because she is American.

Abbey Chikane, the Kimberley Process’ South Africa monitor, accused Milovanovic of not doing enough to pressure the US government to lift trade restrictions.

"When South Africa takes over the chair next year we will solve these issues," Chikane said, according to an AP report.

Former South African President Thabo Mbeki said in a guest address to the conference that it is regrettable sanctions have not been lifted against Zimbabwe.

“[I]n the very short years since Zimbabwe started mining and exporting diamonds, this has generated much international debate that I believe has been unjustifiably hostile to Zimbabwe,” he said.

But Mbeki also said Zimbabwe’s resources should benefit locals and not a “predatory” group of elites, and called for more transparency to the country’s diamond mining industry.

"As elections loom in Zimbabwe next year, the country must prove that it is not a rogue state," he said.