Diamonds are Whose Best Friend?

Zimbabwe is reputed to be the country with the most natural resources per capita in the world. While we are rated about 136 in terms of investment, we are number one on the resources per capita table - we have a small population so do not get too excited, but it does show that we are a potentially very rich country. The fact that we are one of the poorest countries on earth has everything to do with our government and nothing whatsoever to do with our potential or our people.

In 1890, a world renowned geologist retained by Rhodes to advise him on the gold mining potential of southern Africa, told Rhodes (quite correctly) that the real wealth of the region was in the open veld some 30 kilometres from the new mines on the Witwatersrand. Rhodes went on to act on that advice and one of the world’s greatest business empires was the eventual result, with South Africa producing some three quarters of world gold output per annum for nearly 7 decades.

But he was wrong on Zimbabwe - we have in recent years found that we have the potential for some large mining operations that could result in us producing up to 100 tonnes of gold a year in the not too distant future. This would put us up there with South Africa and Australia. But it is the discovery of diamonds that has caught the imagination over the past two decades.

First came the discovery of diamonds over the Limpopo River near Beitbridge by De Beers. They decided not to exploit the find and the claims were taken over by an Australian mining company that opened it up and after a couple of years, abandoned the mine and their assets, fleeing with whatever diamonds they could carry. The claims were purchased from the liquidator by a Bulawayo family who quickly ran into another sort of problem in the form of greedy, corrupt Zanu PF leaders who proceeded to dispossess the family and take it over - in partnership with a shady character from the Middle East. That situation prevails today and the mine, in addition to producing a small flow of diamonds, is used to launder diamonds from other countries, mainly Angola and the Congo.

Then the same company, De Beers, who have been quietly exploring the country for diamonds, discovered the alluvial diamonds at Marange - just outside the City of Mutare on the Save road. They opened up some trenches and decided that this too was not worth the trouble and after they had abandoned their claims, a small group of Zimbabweans in the Diaspora formed a company they called African Consolidated Resources (ACR) in London and they decided that they would pick up this discovery.

Before ACR could begin mining, they too were given the standard Zanu PF treatment of illegal but forced dispossession, forced occupation of the claims by various Zanu PF linked firms and individuals and a wild invasion of thousands of small scale miners who simply mined wherever they could and sold the stones they found to the nearest buyers. In the melee, hundreds of small scale miners were beaten, many killed by gunfire from army and police and eventually a sort of armed peace was imposed where an unholy mixture of corrupt army and police exploited the small scale miners on the fringes and an extraordinary collection of international thieves and thugs conducted formal mining operations protected by the security services and operating some sophisticated equipment and even aircraft and helicopters.

This was not taking place in Serra Leone - this was in Zimbabwe with its neat roads, clean Towns and Cities, a standard Police Force backed by formal Courts with Magistrates and Judges in robes and white wigs. This was not in the Wild West - this was in a country that deeply respects the administration of justice and is generally law abiding in normal day to day life.

What we have now at Marange, is an alliance of a Chinese registered company with links to the Chinese Army, two local companies with Russian, Israeli and South African mafia connections and direct mining operations by both the police and the army. The remaining small scale miners operate secretly and at night and try to survive on what they can steal or produce from shallow working in the alluvial sands. The original diamond pipe has been found and is reputed to be very rich, but is in hard rock and requiring something that the present operators do not have - real mining experience and expertise.

And none of this is legal or open and transparent. In the deserts of Botswana De Beers operates a joint venture with the Botswana government. There the mines are tightly controlled, all diamonds are recorded and sent to a clearing House in Gaborone where they are graded and processed and then marketed globally in a transparent manner. The wealth from the operations, flowing back into the coffers of a government that has been able to transform the lives of the people of Botswana in a couple of decades.

Estimates vary but most industry sources say that the Marange alluvial diamond fields could be producing in excess of $100 million a month in raw, uncut diamonds. If we assume that 75 per cent of the gross revenue from these sales would normally accrue to the State in one form or another, then this source of revenue, by itself, could double civil service salaries. Instead we have people taking diamonds out of the country illegally, we have plenty of signs of new wealth in Mozambique border towns and we hear of sales of diamonds in Dubai, China and India. Most recently, just to emphasise their interests, the Chinese Communist Party Youth League has had a delegation here and they were given a tour of the diamond fields, closed to everyone else, including our Parliamentary Committee responsible for oversight of the mining industry.

And so Zimbabwe limps along, poor, marginalised and abused despite or maybe, because, of its wealth and resources. Our only hope being to get to an election where the votes of our people will finally break the stranglehold that Zanu PF has on our lives and resources. They really have given us no alternative; they must go and must go now. The sorry saga of our diamond discoveries is simply another reason, after the corrupt shambles in agriculture and the destruction of our currency and industrial economy, as to why Zanu PF no longer has anything to offer the electorate in Zimbabwe. They are simply beyond redemption.

Eddie Cross
Bulawayo, 28th May 2011