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'Mugabe and cronies stealing diamond cash'

By Sapa-AP | Nov 13, 2012 | COMMENTS [ 139 ]

The Marange field's vast earnings could have turned around Zimbabwe’s economy. But funds from the diamond sales have not showed up in the state treasury

At least $2 billion worth of diamonds have been stolen from Zimbabwe’s eastern diamond fields and have enriched President Robert Mugabe’s ruling circle, international gem dealers and criminals, according to an organization leading the campaign against conflict diamonds.

Zimbabwe’s Marange fields have seen “the biggest plunder of diamonds since Cecil Rhodes,” the colonial magnate who exploited South Africa’s Kimberley diamonds a century ago, charged Partnership Africa Canada, a member of the Kimberley Process, the world regulatory body on the diamond trade.

Zimbabwe’s eastern Marange field — one of the world’s biggest diamond deposits — has been mined since 2006 and its vast earnings could have turned around Zimbabwe’s economy, battered by years of meltdown and political turmoil, the group said. But funds from the diamond sales have not showed up in the state treasury. Instead there is evidence that millions have gone to Mugabe’s cronies.

The report, released Monday to coincide with the Zimbabwe government’s conference on the diamond trade here in Victoria Falls, casts a shadow over the Mugabe regime’s effort to win international respectability for its gem trade.

Government officials at the conference denied the report’s allegations as “totally false”. 

Mugabe pledged that Zimbabwe will soon have new law to ensure greater transparency and accountability in order to boost the ”international reputation of our diamonds”.

Opening the conference, Mugabe said his government is committed to observing “international laws on diamond mining, storage and trading”. 

The report condemns the Mugabe government’s control of the Marange diamond fields which have made Zimbabwe a major player in the international diamond trade.

“Marange’s potential has been overshadowed by violence, smuggling, corruption and most of all, lost opportunity,” the PAC report said.

“The scale of illegality is mind-blowing,” and has spread to ”compromise most of the diamond markets of the world,” said the report.

The report describes the $2 billion lost to the Zimbabwe treasury as a “conservative estimate”. 

Finance Minister Tendai Biti said in his 2012 budget he had been promised $600 million in diamond revenue for the national treasury to help re-finance crumbling health, education and other public services. Biti said that only one-fourth of that pledge has been received.

Mines Minister Obert Mpofu, a Mugabe loyalist, insists that Western economic sanctions have prevented the government from getting good prices for the diamonds on the international market.

But Mpofu has repeatedly refused to give exact figures on diamond revenues, said the PAC report.

Mpofu, the mines minister since 2009, amassed an unexplained personal fortune and is linked to a “small and tight group of political and military elites who have been in charge of Marange from the very beginning” and who are personally benefiting from the diamond sales, the report alleged.

In 2010 leading industry insiders, including Filip van Loere, a Belgian diamond expert working for the Mugabe government, forecast the country could produce as much as 30 million to 40 million carats a year, worth about $2 billion annually, the PAC report said.

The diamonds are being mined and sold but the funds are not reaching the Zimbabwean treasury, according to the report.

Most of the diamond revenue is lost through a lack of transparency in accounting for how many diamonds are mined, how much is 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 $600 million, which the report said is an artificially low price because the same stones were sold for double their original price when they left Dubai for Surat, India — the world’s biggest diamond cutting center. It says the gems should have been valued at $1.2 billion.

The low valuation lost the Zimbabwe nation considerable money and “underscores a price manipulation scheme perpetrated by Indian buyers and their Zimbabwe allies, with whom they are believed to share the spoils,” the report said.

In addition, the report’s researchers were unable to locate a 2.5 million carat stockpile, valued at around $200 million, which mysteriously disappeared in November 2011. It also charges that $300 million in diamond sales never made it to the Zimbabwe treasury in 2011.

The PAC’s allegations are “totally false,” said the chairman of one of the state-run diamond mining companies in Marange. Goodwills Masimirembwa, chief of Zimbabwe Mining Development Company, told The Associated Press that it was the first time he heard charges of diamonds disappearing.

“No diamonds have ever gone missing,” said Masimirembwa. “When we are selling our diamonds all stakeholders, the police, revenue board and the country’s mineral marketing body come together. So are they saying all these institutions are in collusion? Instead, let them come up with specific allegations, then the police will investigate.” 

The watchdog report also criticized the Kimberley Process for allowing Zimbabwe’s diamonds to mined and sold in way that was not open to scrutiny.

“Calls for greater transparency have been dismissed within the Kimberley Process,” it said.

“The lack of transparency surrounding Zimbabwe’s diamond revenue is matter of critical public interest and amplifies concerns for some time that these revenues are funding a parallel government” of police and military officers and government officials loyal to Mugabe, many known to be building private mansions and buying luxury cars costing far in excess of their income from tax-funded salaries, said the report.

COMMENTS [ 139 ]

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!#Sinudeity#!
Dandan - Meanwhile, Zim imports all its maize from Zambia, home of the former Zimbabwean exiled farmers.
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blahblahblahblah, there is no land that suits evrything, maize crops in zim does nt suit, if it was a case mpumalanga in SA would be planting grapes and maize in CT


@SOLUTIONS, there is nothing I can learn from you if you still dont know Zim is the cheapest country for mining , telling me diamond is all the world , nt here with me, boy , if you want to be man buy Fin and Econ Mag subscribe in actual fact , therefore your brain will be quick

Nov 13, 2012 2:0 | 0 replies

Dandan, go back in history properly, and get YOUR facts straight. The earth is a lot older than 100 years boy.

Nov 13, 2012 2:50 | 0 replies

@SOLUTIONS



you sdomo maaan domkop , you didnt know China has the biggest GDP in the world , you didnt even know what is IMF I gave you tips , reread my blogs they are very intersting

Nov 13, 2012 2:51 | 0 replies

T.C.T - Bob is protecting his land? Do you even know how much of Zimbabwe land Bob gave away to Fidel Castro?

Nov 13, 2012 2:52 | 0 replies

T.C.T,

Go and speak to someone in the Ndebele tribe and ask them how their people was murdered one by one in gruesome ways by zanu pf, please do yourself a favour, please read this article about diamonds that is stolen, please read how mugabes people suffer and his wife and children goes on shopping sprees in Switzerland.

Please go and see how many people were jailed just for talking against mugabe, people in the streets are not even allowed to say something bad against him or they get the end of a stick.

You ten too one support the i.diot king of swaziland as well hey?

Nov 13, 2012 2:54 | 0 replies

Dandan - The US GDP is THREE TIMES greater than China's.

Nov 13, 2012 2:55 | 0 replies

Ooh, I see a senior ANC person has defected to the DA.

Nov 13, 2012 2:59 | 0 replies

Dandan
you sdomo maaan domkop , you didnt know China has the biggest GDP in the world

Please tell me where I contested it, thanks for the info but dude, as far as I know the US has still the biggest GDP as per 14.6$ against China's 10$, maybe this was a while ago and I do not really care about it, I just make money from both countries. I will see if I can find that link for you. I think China has the fastest growth though.

, you didnt even know what is IMF I gave you tips , reread my blogs they are very intersting

Dude really, I did not read where you even spoke about IMF, you are as interesting as your spelling, weak, uneducated and dull.

Nov 13, 2012 3:1 | 0 replies

@antie


what is that you dont get , so fuming like this


!#Sinudeity#!
Dandan - So whats Ch1na doing in Tibet dude?== because they are factionalists

Nov 13, 2012 3:2 | 0 replies

SOLUTIONS

thank you so much my chief for pointing out that the world wanted free and fair election DO WE agree that after COMRADE MUGABE became president things started to get out of controll? not because he was a president because BRITAIN AND USA Freezed ZIMBABWEAN accounts all over the world and ZIM could nt progress without money and the very same ppl im refering to also lodged some sanctions to ZIMBABWE and investors wer withdrawing their business out of ZIM so one sober mined person can realise that the purpose that the western desired indeed it happen they destabilised and made ZIMBABWE wat is is today,why DONT u ask yourself why chines are busy doing business with ZIM?and funny enough the very same ppl from the west are now returning burg doing business in ZIM cause they hoped their intention will work if they are not availbale in ZIM but we thank CHINES business to pick up ZIM..so fo the last time stop reading british newspaper cause they will try by all means to destroy MY LEADER and favourite president

antie

you and your respond are irrelevent dont have time to wast so buzzzz offf plssss..kikikiki

!#Sinudeity#!
selective reading wont dou any good,,,what do u understand about lancaster afreement and wat kind of contets did it have?and wat does it say about land specifically?

Nov 13, 2012 3:3 | 0 replies

Dandan....."what is it you dont get , so fuming like this'......HUH??????

Nov 13, 2012 3:4 | 0 replies