Zimbabwe has lost more than $2 billion in income since 2008 due to the plundering of the country’s diamonds by the military and a circle from President Robert Mugabe’s Zanu PF party, says diamond industry non-governmental organization (NGO) Partnership Africa Canada (PAC) in a report.
Called Reap What You Sow: Greed and Corruption in Zimbabwe’s Marange Diamond Fields, the watchdog's report is being released to coincide with the opening of the November 12-13 Zimbabwe Diamond Conference 2012.
Zimbabwe's Marange area has experienced "the biggest plunder of diamonds since Cecil Rhodes," the British colonial tycoon who exploited South Africa's Kimberley diamonds more than 100 years ago, said PAC.
The Kimberley Process member said it is concerned about the lack of transparency regarding the country's diamond revenues and that the ruling clique is creaming off millions of dollars from the sale of diamonds from the controversial Marange area. NGO Global Witness left the Kimberley Process this year due to what it said was a lack of progress at the KP, and published a report saying that the Marange diamond mines are providing funding for Mugabe’s military.
PAC says the diamond industry's failure to prevent the smuggling of diamonds from the eastern Zimbabwe region compromises the global diamond supply chain.
The report identifies Mines Minister Obert Mpofu as one of the main beneficiaries of the smuggling and sale of Marange diamonds. PAC claims that Mpofu has helped himself to around $20 million from Zimbabwe's diamond industry via his company, Three Waters Investments.
Mpofu is part of a "small and tight group of political and military elites who have been in charge of Marange from the very beginning" and who are greatly benefiting from the diamond sales, the report says.
Mpofu, for his part, says he does not own Three Waters Investment or other companies mentioned in the report which he describes as “unprofessional and pedestrian."
The KP took three years to reach a decision regarding the export of diamonds mined in Marange, and only in November 2011 did it lift its ban.
PAC research director Alan Martin says: “PAC has found that while the mismanagement of Marange remains primarily a Zimbabwean problem, the global dimensions of the illegality has metastasized to compromise most of the major diamond markets of the world. Previously, most of the illegal trade primarily involved South Africa, Mozambique, UAE and India. This remains the case, but greater vigilance by enforcement authorities should now extend to other centres, particularly Israel.”
Zimbabwe's Finance Minister has repeatedly complained that the Treasury is not receiving anywhere near the amount of money that it should from the sale of the Marange diamonds.
Four companies are operating mines in Marange: Mbada Diamonds, Anjin, Marange Resources owned by the Zimbabwe Mining Development Corporation and the Diamond Mining Company.