HomeNewsLow prices disrupt Zim diamond revenues

Low prices disrupt Zim diamond revenues


MINES and Mining Development minister Obert Mpofu says the country will not realise the projected $600 million from the sale of diamonds, as a result of a slump in world prices of the precious mineral.

Addressing journalists in Harare yesterday on the preparations for the forthcoming inaugural international diamond conference, Mpofu said sanctions had resulted in less revenues being realised, as buyers were being threatened.

“We have actually projected certain targets, but of late, in the past three to four months, the diamond prices have actually gone down and there hasn’t been sufficient production to meet our projections.

“When the prices go down producers also reduce their production capacity,” Mpofu said.

“They cannot produce for a loss. The idea was to make a contribution of over $600 million from diamonds this year, but that target has been interfered with by the reduction in diamond prices and also by sanctions.”

Last year, Finance minister Tendai Biti reviewed upwards the National Budget to $4 billion from the initial $3,4 billion on account of improved diamond revenue projections, before being forced to revise it downwards to $3,640 billion in July this year, as a result of underperformance of diamonds. Mpofu, however, said diamond revenue constituted a greater chunk of the National Budget.

He said the forthcoming diamond conference presented an opportunity for the country to manage its perception and lure more investment into the diamond industry in particular and mining as a whole.

International speakers at the event will include Kimberly Process chairperson Gillian Milovanovic, African Diamond Producers Association, World Diamond Council and the World Federation of Bourses on Diamonds among others.

Mpofu hails KP chair

ON KP chair, Mpofu said: “Her coming here is to strengthen the organisation. The US has been dragged into a situation where it is fighting a war which is alien to it. We don’t have a direct problem with the US. They just inherited a problem we have with the British.

“She has performed fairly well during her term. This term has made a lot of progress in terms of the consolidation and uniting member states unlike the previous chairs. We had very unfortunate experiences with certain countries that chaired the KPC in the last three or so years, but she has been very fair to everybody and to issues that are tabled before the organisation.”


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