Corruption Claims Deepen for Zimbabwe

150 150 Rapaport News

RAPAPORT… After President Robert Mugabe threatened to break with the Kimberley Process (KP), Obert Mpofu, Zimbabwe’s mines minister, was quoted in the state-run Herald newspaper as saying that the government had accepted Abbey Chikane, the head of the South African Diamond Board and former KP chairman, as the KP monitor of the Chiadzwa diamond fields in Marange. The Marange fields have been plagued by severe human rights abuses conducted by the military and as a result, the monitor was a required component of the work plan designed to bring Zimbabwe’s diamond industry into KP compliance.

In the latest turn in the long-running legal dispute between the British-registered mining company African Consolidated Resources (ACR) and Mpofu over the ownership of the Marange diamond fields, the country cancelled ACR’s mining licenses, AFP reported. ACR’s lawyers told the news agency that the firm was given until March 10 to appeal the decision.

ACR was forced off its property by police in 2006, but in September 2009, a High Court judge ruled that the firm’s ejection was illegal and that ACR was the rightful owner. The government appealed and the government’s two mining firms, Mbada Diamonds and Canadile, continued to mine diamonds in the fields.

Illegal Sales

In other news, a parliamentary committee on mines and energy heard testimony of an attempted illegal sale of 300,000 carats of diamonds by officials from Mbada Diamonds in addition to unprocedural appointments by Mpofu, German press agency DPA reported. According to World News Connection (WNC), the government is taking steps to stop the parliamentary committee from proceeding.

Meanwhile, Britain’s Telegraph newspaper reported that an airstrip is being built in the Marange diamond fields, which diplomats and analysts believe will be used to deliver weapons — possibly from China — in exchange for diamonds. The article included aerial photos.

A spokesperson for the Centre for Research and Development (CRD), a local nongovernmental organization (NGO), told Rapaport News that Mbada Diamonds was airlifting diamonds to Harare International Airport in violation of the KP work plan. The spokesperson stressed that soldiers continue to “commit gross human rights violations in and around Chiadzwa.”

Zimbabwe published new Mugabe-backed regulations to give local investors a 51 percent stake in major corporations, such as banks and mines, according to the BBC. Prime Minister Morgan Tsvangirai said the regulations, which are to take effect in March, were not discussed and approved by the cabinet, highlighting tensions in Zimbabwe’s strained power-sharing government.

Days afterward, Zimbabwe’s Chamber of Mines made an eleventh-hour proposal to reduce the shareholding threshold for indigenous Zimbabweans to 10 percent. Victor Gapare, Chamber of Mines president, told the BBC that the government had, in principle, agreed to its proposals.

On February 16, the European Union (EU) extended its sanctions on Zimbabwe for another 12 months, citing a lack of progress in implementing power sharing, according to Reuters. The EU began imposing sanctions in 2004.

At its annual meeting in Munich, Germany in February, CIBJO, the World Jewellery Confederation, called upon its members to significantly boost the industry’s efforts to ensure that no diamonds from the Marange diamond fields are traded until the required KP monitor is in place. The group stated that it strongly believes that the KP will continue to prevent the flow of conflict diamonds into legitimate markets.

Stolen Goods

London-based independent jewelry retailer Ingle & Rhode released a statement asserting that all of the diamonds removed from ACR’s disputed claims should be considered stolen. The company also confirmed that it produces jewelry using conflict-free diamonds and Fair Trade gold.

Speaking at a mining conference in South Africa, Rio Tinto’s diamonds and minerals chief executive officer (CEO), Harry Kenyon-Slaney, pledged his support for its Murowa diamond mine in Zimbabwe. Murowa has the capacity to increase its production sixfold, according to a senior company executive cited at The group holds a 78 percent stake in the operation.

— Additional reporting provided by Acquire Media.

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