Our diamonds nurture ‘mafia’ culture

I read with keen interest the first report of the Portfolio Committee on Mines and Energy on diamond mining (with special reference to Marange Diamond Fields) 2009–2013 presented to Parliament last week.

View Point with Wisdom Mdzungairi

The committee, through its oversight responsibility, conducted an enquiry into the country’s diamond mining sector and discovered that it was being run in “mafia style”.

The enquiry was meant to hold the Executive accountable for its programmes, policies and actions in the sector, taking into account the fact that the financial hopes on revenue proceeds for government, in 2012-2013 were premised on the buoyant performance of the diamond sector.

But the findings are startling if not perplexing. Perhaps this could explain why there is a contestation of power between the Executive and the Legislature over access to information and entry into the diamond rich Marange area. There were however, positives much as there were also negatives to Marange, but negatives outweighed the positives.

Irregularities and loopholes at each of the different stages of the diamond value chain reportedly dominated the production chain. However, even with these challenges, if proper mechanisms, strong administration and adherence to both national and international laws were observed, Zimbabwe could still derive maximum benefit from the diamonds.

It is the manner in which Mbada Diamonds and Canadile Miners reportedly refused to appear before the committee which raised a stink. On several occasions in 2010, Mbada Diamonds was invited to appear before the committee to give evidence on its operations.

The firm resisted, and only complied when the Parliamentary committee invoked section 9 of the Privileges, Immunities and Powers of Parliament Act, which states that Parliament may issue summons, delivered by the police to a witness to attend before it.

Mbada is being accused of displaying a “big brother” syndrome such that some of the government institutions were rendered “powerless” to question its decisions or actions.

This, it is understood, emanates from the manner in which Mbada was selected to partner with government and how board members were selected to sit on the Zimbabwe Mining Development Corporation’s (ZMDC) subsidiary boards.

What I also find curious is the fact that the ex-ZMDC chair Gloria Mawarire seemingly lied more than once to the committee, in clear violation of Parliamentary statutes. One wonders why she did that if the value chain was transparent. It boils down to murky sales at Chiadzwa diamond fields.

There is no explanation as to why the Edward Chindori-Chininga-led committee was repeatedly denied entry to conduct on-site inspections of the mining companies operating in Marange, while Kimberley Process monitor South African Abbey Chikane and others were let in without any vexations.

Perhaps this explains why over the years, the sector has been dogged by transparency and accountability matters in the production, marketing, fiscal contributions and general administration of Chiadzwa diamonds. In that regards, there is lot of work to do to improve the entire value chain of the country’s diamonds.

Overall, there is no doubt Zimbabwe’s diamond industry has potential to stimulate substantive socio-economic growth through the development of upstream and downstream industries. But I concur with the Committee, this will be difficult to achieve in the absence of a strong policy and legal framework.

Isn’t it time government should come up with a coordinated policy to boost the sector? Because the diamond policy that was adopted last year stipulates that a quota of all locally produced rough diamonds shall be reserved for local beneficiation.

Sadly, the committee confirmed our worst fears that the government was not supportive of the local diamond cutters and polishers therefore scuttling their efforts to developing the sector. The policy is vague in terms of the quota and the quality of gems to be supplied to the local cutters and polishers.

At the same time some local cutters and polishers lost their money to government after paying licence fees without a corresponding duty of accessing the diamonds.

Yet, the local cutters and polishers industry has potential to create more wealth and employment for the economy as they add value to raw diamonds. It seems, government is content with selling its diamonds in their raw form, creating more jobs and wealth for countries such as India. Isn’t this a travesty of justice?

If government is genuine with developing this industry, why would locals be forced to part ways with $300 000 to access rough diamonds for cutting or polishing at their colleges?

The growth of the local cutters and polishers was also being impeded by exorbitant licence fees which were increased in 2012 to $100 000 renewable every year and yet there was no guarantee of receiving a parcel or reimbursement if the parcel is not delivered.

My standpoint on this matter would be for the government to spearhead value addition of the diamond resource to avoid inconsistent policies applying to the same industry.

Are we sure, we want to nurture this ‘mafia’ culture in the diamond sector?

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