Anjin Investments, a joint venture between a Chinese company and the Zimbabwe Mining Development Company (ZMDC) said it is grappling with high costs associated with mining a conglomeratic placer deposit.
The company’s deputy general manager Gertrude Takawira told Rough & Polished’s African Bureau Editor-In-Chief Mathew Nyaungwa on the sidelines of the Zimbabwe Mining Indaba late September that although Anjin had the biggest mining concession, the presence of conglomeratic placer in the area had put their competitors within the area, a notch ahead, as they had large deposits of alluvial that were less costly to mine.
She dismissed reports that the company was not remitting its revenue to the country’s Treasury and that their operations were conducted in a secretive manner.
Anjin welcomed the lifting of sanctions imposed on ZMDC by the European Union saying they shouldn’t have been put in place in the first place.
It also called on diamond cutters and polishers in Zimbabwe to establish joint ventures to emerge stronger and therefore making it possible for them to compete with global giants such as Tiffany.
Below are the excerpts.
You noted in a contribution during the Zimbabwe Mining Indaba that it is important to come up with a regional diamond trading centre. Why do you think so?
Basically because Africa, particularly Southern African countries like Zimbabwe are new players and for them to quickly get onto the market for obvious reasons: global competiveness, recognition, reputation, we need to go in as a bigger player rather than as single countries.
Which countries are you looking at, given that countries such as Botswana, Namibia and South Africa trade their diamonds under De Beers and this will soon be taking place in Gaborone?
When, we talk about regional integration, particularly SADC, we don’t throw away the political aspect and some of the players in the diamond industry are not necessarily political players and that obviously has an impact in terms of government policy, in terms of their decision to create a trade centre. So, I don’t see why DRC for instance, which is also a major player coming onto the market, cannot partner with the Zimbabwean diamonds to come up with a trade centre, perhaps based in Zimbabwe or DRC. Even De Beers itself, I don’t see why we cannot work together at some point.
So is it a plan that is in its gestation period or you pitched your idea to some regional countries?
It is just a dream (for now).
Recently, the European Union lifted sanctions on ZMDC, which you partnered to mine diamonds in Marange. What is your comment on that?
We believe that some of the sanctions are nothing but a waste of time. Just perhaps for the politicians to believe that they are doing something but in terms of diamonds they are God given. They are there to save the world, they are there to save the people of Marange for instance and denying them international access is just delaying development... So I believe it’s a welcomed move but not to say it was a necessary move in the first place. Personally, as a Zimbabwean, as an individual (I think the sanctions) were not necessary.
Even though the EU has lifted sanctions on ZMDC, I understand the U.S is yet to lift sanctions, which has seen some diamond revenue being frozen by OFAC. Is that not going to affect your operations?
It is still a cause for concern but I think as much as the Americans want to make the world believe that they are democratic, that they are a good big brother, they need to now revise some of their principal policies regarding sanctions. Some of their policies are really individualistic; they are not a good big brother, kind of policies. So I think, yes, it will affect us for some time as a country but I believe that the truth will prevail and the light will prevail over darkness.
Some critics of Belgium, which has been in the fore-front calling for the lifting of diamond sanctions, argue that the move was more business driven than political as Antwerp was losing business to China, UAE and India. Have you been approached by Antwerp so far?
Well, not that I know of any, we are currently having a sale and am sure some of the people that have offices in Belgium, but quite honestly it’s about time, we are excited to see many players coming on stream and hopefully this will have a positive impact on pricing.
Tell me about this sale, how many carats are under the hammer and what is the level of appetite for your diamonds from the buyers?
The appetite is quite high but I think for now you will appreciate that some of the things are very confidential, we are not letting it out at the moment. However, we have good players, large players and hopefully they will have a good sale.
A lot has been said about diamond mining in Marange, particularly your company Anjin and in most cases we haven’t heard much from you. What do you say to your critics that claimed that you haven’t been channeling diamond revenue to the Treasury and that your operations are done in a clandestine manner?
I think following the same lines that we were under sanctions both politically and economically, you will find that some of those people that have been talking, had been more for sanctions and so genuine and truthful people will tell the truth that Anjin has done a lot in terms of infrastructure development. If you look at the re-location, where everyone would like to raise noise, who built the clinic? Who built two schools? Who built homes for 470 families? Harare itself cannot provide tap water but villagers at ARDA Transau have piped water. I was joking the other day that even their cattle drink piped water. We have done a lot of work, but unfortunately, we did it under a negative background and it had been difficult for people to appreciate the good work that was done. There is a scope for development, scope for improvement in relation just by the mere fact that we have Chinese and Zimbabwean [partners]. They are cross cultural difference that we have to iron out but [there is] nothing unusual about that kind of a joint venture.
Let’s look at production, I understand you are the biggest diamond producer in Marange, am I right?
We have the biggest mining concession in terms of the area but we have more of conglomerate mining and so our production costs are naturally higher than alluvial. Some of our competitors within the area have large deposits of alluvial and of course they have benefited by the mere fact that their cost of production is low. Our cost of production is high; we also did a lot of investments like I said in other social projects…So, I think, in terms of productivity that high cost of production has affected our role…
How many carats of diamonds did you produce last year and what is your projected output this year?
You are putting me on the spot, I do not have last year’s figures with me and as for this year’s output, we are still working on that, it’s actually a challenge that we are going through particularly because when we went through, we thought we would be more into alluvial, so we need a lot of technical studies done in terms of the exploration of some of the areas that we are still left out with and of course the mining planning that still needs to come in.
Tell me about the quality of diamonds that you produce in Marange, are they more of gem quality or industrial?
We have both industrial and gems, we are still working out, which is more but I think we have more industrial.
The Zimbabwean government requires diamond producers like Anjin to provide 10 percent of their annual output to local cutting and polishing companies. Have you been in a position to implement that?
Yes, it’s already in action, but of course it’s a demand and supply situation. The demand is influenced by the capacity of our polishers to take on the diamonds and do the processing; this is why I was talking about global competitiveness of going in as larger players rather than small players, small polishers trying to compete with Tiffany. So you are looking at least having a unified approach to the polishing and marketing of diamonds. Obviously that will have an impact on the demand for rough diamonds for local manufacturers.
Going forward, what is your projection of the diamond industry in Zimbabwe in general and Anjin in particular?
I think, now that we have one party in government – ZANU PF, you know one policy vision, I see that impacting positively on our development and we are looking forward to the next five years.
Mathew Nyaungwa, Editor in Chief of the African Bureau, Rough&Polished
