VICTORIA FALLS – Zimbabwe has lost nearly $30 million in diamond revenue and dividends to seizures under a 2003 Western financial embargo on President Robert Mugabe, and his inner circle, a top government official has said.
Although industry players said the confiscations did not necessarily mean the country was losing parcels of its Marange gems, Mines minister Obert Mpofu said the targeted measures — being implemented by America’s Office of Foreign Assets Control — were not only hurting traders and mining companies, but prices as well.
“We estimate that… about $30 million has been confiscated by the various agencies that implement these sanctions,” he told the inaugural diamond conference yesterday.
For a country hoping to supply 30 percent of global rough diamonds by volume in 2015 and that has just attained Kimberly Process (KP) certification, Mpofu said Harare felt disheartened by the continued existence of the smart sanctions – just as it had to battle for KP recognition when it had removed lawlessness at Chiadzwa.
In his headline speech, Mugabe also said Zimbabwe’s diamonds must be traded or allowed similar market space as any product from across the world.
“The diamonds have been marketed at depressed prices owing to a negative buyer perception resulting from these illegal sanctions,” he said.
To demonstrate its commitment to international best practice and that the industry was key to its economic revival, the Zanu PF leader says the country has adopted “concrete measures to promote accelerated diamond exploration and transparency”.
“In view of the competitive nature and strict diamond trading… government has committed itself to the observance of international standards attached to diamond mining, storage and trading,” Mugabe said, adding the formulation of the diamond policy and ensuing bill were further proof of these efforts.
In this regard, the deployment of specialised security units and the Zimbabwe Revenue Authority were further moves to prove this “seriousness over good governance” in the trading of the country’s precious minerals.
Earlier, international diamond expert Chaim Even-Zohar had also told the same summit that Zimbabwe’s diamonds were trading at a discount of up to 25 percent due to the western travel and asset ban on the Mugabe regime.
Although the country has attained KP certification, the handling of Marange diamonds continues to be a source of rankle among civil sector players and the west, but Mpofu and his allies, including Zimbabwe Mining Development Corporation chairman Godwills Masimerembwa said they had no choice.
For a sector, which accounted for about 45 percent of total mining revenue or earnings in the first nine months of 2012 and nearly 96 percent of the $2 billion exports achieved by the country since 2006, the Umguza legislator says the figures could have been better.
With diamond deposits first discovered in Zimbabwe in 1903, the geological hosts of the Marange-type of deposits is potentially greater and government says there are also over 150 known kimberlites in existence – mostly in the southern region.
While Mpofu says Zimbabwe is in the top five producers of rough diamonds by volume in the world, Mugabe and pro-government allies such as Zohar claim the country could easily be in the top two.
On Monday, the two-day summit also heard that the country owed much of its KP success to Namibia, which continued to provide technical and financial assistance at Chiadzwa.
At the moment, Zimbabwe has four KP complaint diamond producing mines and operations at various stages of development.
The meeting, which has drawn various international financiers, buyers and other stakeholders, also saw India – a key buyer of Zimbabwean gems – pledging its continued support for the Harare government.