Zimbabwe recently hosted its first ever diamond conference in the resort town of Victoria Falls, which attracted several big shots in the industry.
These included World Diamond Council president Eli Izhakoff, Antwerp World Diamond Centre president Stephene Fischler, World Federation of Diamond Bourses president Ernie Blom, Tacy president Chaim Even-Zohar and a number of African mines ministers.
With such a lineup of industry gurus there was no doubt that Harare was serious about sprucing up the battered image of its diamond industry.
Diamonds from Marange had been condemned by some Kimberley Process (KP) members, mostly from the West.
They accused Zimbabwe’s security personnel of abusing human rights when they drove out artisanal miners that descended on the diamond fields in 2006.
They also alleged that the gems mined in the area were being used to fund President Robert Mugabe’s party and security elites.
Although, Zimbabwe denied the reports, KP suspended Marange diamond exports in 2009 until late last year.
The United States also slapped sanctions on companies mining in Marange despite KP’s green-light.
So, as speaker after speaker spoke glowingly about Zimbabwe’s diamonds, thousands of miles away from Victoria Falls, was a gathering, whose purpose was to “expose” the “pillaging” of the country’s diamond revenue for the past three years or so.
The Partnership Africa Canada (PAC), a non-governmental organisation, released a damning report, Reap What You Sow: Greed and Corruption in Zimbabwe's Marange Diamond Fields, which alleged that diamonds worth $2 billion had been plundered by President Robert Mugabe's ruling elite, international dealers and criminals.
It described the $2billion as a "conservative estimate".
"Marange's potential has been overshadowed by violence, smuggling, corruption and most of all, lost opportunity," the organization, which monitors blood diamonds said.
"The scale of illegality is mind-blowing" and has spread to "compromise most of the diamond markets of the world."
PAC singled out mines minister Obert Mpofu as perhaps the biggest beneficiary of the diamonds.
It alleged that the minister had amassed an unexplained personal fortune and was linked to a "small and tight group of political and military elites who have been in charge of Marange from the very beginning".
PAC said Mpofu had spent more than $20 million mostly in cash over the past three years and owned vast swaths of land.
"While Mpofu is not the only Zanu official benefiting from Marange's riches, his role as the chief guardian of Marange raises the most concern," the report said.
PAC noted that most of revenue from Marange was lost through a lack of transparency in accounting for how many diamonds are mined, how much was earned from their sales, the underpricing of gems on world markets, smuggling and a "high level of collusion" by government officials.
“Records show that 10 million carats of Marange diamonds were exported to Dubai in late 2012 for $600million, which is half the value it should have been. This underscores a price manipulation scheme perpetrated by Indian buyers and their Zimbabwe allies, with whom they are believed to share the spoils," PAC said.
It said its researchers were also unable to trace a 2.5 million carat stockpile, valued at around $200 million, which mysteriously disappeared in November 2011.
PAC also claimed that $300 million in diamond sales never made it to the Zimbabwe treasury in 2011.
Mpofu told the Victoria Falls gathering that the PAC report was “nonsense and malicious”.
He also told Voice of America that: "I will not dignify those baseless accusations with a response. This is pure madness, rank madness really from a group that is sponsored by countries that do not want to see us benefiting from our diamonds.
"They can continue to talk but we will not look back. Zimbabwe's diamonds are the best and they are hurting that they are not mining in Marange, that's all. We are used to this. They release reports ahead of major conferences and Kimberley plenary sessions but we are not fazed at all."
Tacy president Chaim Even-Zohar claimed PAC had a $1,2 million budget of which 96 percent was funding from Canada and other First World Kimberly Process participating nations.
He said the timing of the report was so cynical; adding that Zimbabwe’s bid to boost the image of Marange diamonds through the Victoria Falls conference was a huge success despite PAC’s move.
In as much as it made sense that PAC’s timing was somewhat “evil”, it should be noted that their objective in a way was successful.
A simple Google search on Zimbabwe diamonds for the past week provides several results on the PAC report not the diamond conference.
Naturally, news outlets tend to get attracted to negative news than positive ones.
However, one can argue that Zimbabwe managed to win the hearts of industry leaders, as witnessed by WDC’s pledge to engage the U.S Treasury and the European Union over sanctions on mining companies operating in Marange.
So in a nutshell, the conference helped Zimbabwe tell its story to the people that matters the most in the diamond industry, while the PAC report sought to entrench the bad boy image of Zimbabwe in the eyes of the public and the countries that imposed sanctions on Marange diamonds.
Pity, one cannot afford to talk down the damage caused by PAC’s report, it poured sludge on Zimbabwe’s efforts to have Marange diamonds trade freely without impediments.
Mathew Nyaungwa, Editor in Chief of the African Bureau, Rough&Polished
