Zimbabwe’s Marange diamonds have of late emerged popular with Indian buyers as they were being sold at very low prices compared to what De Beers and Alrosa among other miners were offering.
Media reports say buyers in the populous Asian country were “sidestepping” low quality goods provided by the global diamond giants in favour of the Marange gems.
To help understand the state of diamond mining in Zimbabwe, Rough&Polished caught up with a local diamond monitor, Farai Maguwu, who is also the Centre for Research and Development director.
Although Marange diamonds were of low quality and selling for low prices, he said Zimbabwe could be sitting on over 25 percent of the known diamond deposits in the world.
Maguwu said alluvial diamonds were also found in Bikita and Chimanimani.
He said it was difficult to put the value of gems mined in Chimanimani (at Charleswood), East of Zimbabwe, since the southern African country had not invited the Kimberley Process to assess the area.
Maguwu also said Harare’s silence over the state of diamond mining at Charleswood was worrying and the nation could be prejudiced of diamonds worthy millions of dollars.
Below is the full text of an interview he had with our African Bureau Editor-In-Chief Mathew Nyaungwa.
Zimbabwean Prime Minister Morgan Tsvangirai recently said that he was worried about the high level of diamond extraction at the resource-rich Marange fields. Do you agree with his observation?
I agree with the Prime Minister. Some of the companies are mining 24/7 and given that these are alluvial diamonds which are found on the surface, and in light of the absence of mechanisms to maximize diamond revenue collection and channel diamond revenue into the economy, there are genuine concerns that the accelerated mining operations are a disservice to Zimbabwe. One can be excused for saying that as it stands Marange diamonds are free for all.
You are on record saying that diamond trading in Zimbabwe was obscure. Has there been any change over the years?
The change has been very insignificant given that two auctions have so far been conducted since the KPCS agreement in Kinshasa and no figures have been released on the auctions. This [however] creates curiosity and suspicion that perhaps the proceeds are being mishandled.
The Kimberley Process gave Zimbabwe a green-light to resume Marange diamond exports after allegations of human rights abuses at the diamond fields as well as massive smuggling. Was the move premature given worries over opaqueness in production and sales figures?
The move was necessary because of the challenge Marange had paused to the KPCS. Without some sort of compromise over Zimbabwe the KP was disintegrating. However, there was need for effective monitoring to ensure that the Kinshasa deal is not just a blank check given to Zimbabwe to export without accounting to its people who have waited for too long to enjoy the benefits of diamonds as has happened in other Southern African countries such as Botswana, South Africa and Namibia. There is also need for other players such as African Diamonds Producers Association to stop playing politics with Zimbabwe’s diamonds and ensure that the country upholds the principles of transparency and accountability in its diamond supply chain. Unfortunately countries such as South Africa have become predators who are making the most out of the failure by Zimbabwe to put in place transparency and accountability measures to maximize revenue collection. In my view the decision by South Africa to buy diamonds from Zimbabwe even before consensus had been reached within the Kimberly Process was not only a slap in the face of the KP, but was also a display of selfishness and lack of concern for the welfare of its northern neighbor. Further, I also think other parties to the Inclusive Government in Zimbabwe should work harder to improve transparency and accountability in the diamond supply chain. The Kimberly Process alone cannot solve all the problems associated with Marange diamonds. Politicians in Zimbabwe have a big role to play in implementing the KP roadmap in Zimbabwe. Without the political will to uphold the KP minimum standards there is little that can be achieved, if any. Civil Society also has a role to play in making politicians and policy makers accountable. I therefore think the KP decision was well informed and timely.
Independent assessments put the value of the Marange deposit at $800 billion. Is this assessment far-fetched or realistic in your opinion?
I think this assessment is realistic based on current mining operations in Marange and in view of continued discoveries in the region. Now that diamonds have also been found in Bikita and in Chimanimani, Zimbabwe may be sitting on over 25 percent of the known diamond deposits in the world.
Diamonds are said to have been found at Charleswood Estate in Chimanimani some few years ago. What is known about this discovery?
The Chimanimani discovery is public knowledge but since government has not yet invited the Kimberly Process to assess the scale of operations at Charleswood it is difficult to put value on what is being mined there. It is also worrying why government is silent since the nation could be prejudiced of diamonds worth hundreds of millions of dollars annually by the company which has now gone into full scale diamond mining at Charleswood.
You once said that ZMDC, which has partnered firms mining diamonds in Marange had ‘structural and governance issues’ that needed to be resolved. In your opinion, has this been resolved?
The structural and governance issues at ZMDC have not yet been resolved. Despite having been formed through an act of parliament, there is no indication that the operations at ZMDC are above board. ZMDC has 50 percent shareholding in four out of the five companies mining in Marange and has a 100 percent stake in Marange resources. When we say there is lack of transparency and accountability in regarding the mining and marketing of Marange diamonds we are not only pointing to the transgressions of the Chinese and the Lebanese, but the biggest culprit is ZMDC which is by far the biggest player in Marange.
What is your comment on reports that the government will not give diamond mining concessions to small scale miners in Marange?
In the first place diamonds in Marange were ‘discovered’ by artisanal miners who were later driven out through violence. Aware that alluvial diamonds are easily extracted using primitive tools such as hoes and shovels, the KPCS, at its plenary at Swakopmund, Namibia, agreed with Zimbabwe that country need to create a legal framework for small scale miners to mine in Marange and sell their diamonds to the government. This has a muiltiplicity of advantages. First, it is employment creation to the local population. Secondly, government will not continue to lose revenue to international dealers who buy diamonds that have been illicitly mined in Marange. The third advantage is that if artisanal miners are legalized the scourge of human rights violations against them will now be a thing of the past since they will no longer be trespassing into the diamonds fields. It is therefore in the best interest of the Zimbabwe government to legalize artisanal mining. Why must people from China and Lebanon be allowed to mine a resource that an ordinary Zimbabwe is denied an opportunity to mine despite having the capacity to do so?
Do you agree with calls to nationalise alluvial diamond mines in the country?
I do not agree to the concept of nationalising alluvial diamond mines in Zimbabwe. This is because the government of Zimbabwe has presided over the collapse of many parastatals such as Grain marketing Board, National Railways of Zimbabwe, Zimbabwe United Passenger Company and Air Zimbabwe [among many others]. Nationalising diamond mines will only see the well connected benefiting whilst nothing goes to treasury. What I suggest is a public-private partnership between government and international diamond mining companies. A good example is DEBSWANA which a joint venture between De Beers and the government of Botswana.
Mathew Nyaungwa, Editor in Chief of the African Bureau, Rough&Polished
