Govt plans second tender of Marange diamonds

THE positive response from trial sale clients has reportedly encouraged the Zimbabwe government to plan a second tender of Marange diamonds at the Antwerp World Diamond Centre (AWDC) in February.

The goods that were offered in the trial tender included rough diamonds from Marange Resources, Diamond Mining Company, Anjin Investments, Jinan and Kusena Diamonds, totalling 279 723 carats.

The sale of Marange diamonds in Antwerp from December 11 to 16 followed the removal of European Union sanctions on the Zimbabwe Mining Development Corporation and a culmination of high-level meetings of Zimbabwean officials and AWDC both in Harare and Antwerp.

In an update after the first tender, Mines and Mining Development permanent secretary, Francis Gudyanga said the trial tender had "provided insight and has resulted in tangible guidelines that will allow the Government of Zimbabwe to fully optimise a second larger tender of Marange goods in future".

"The next sale is scheduled for February 12 to 19 2014," Gudyanga said.

Gudyanga said the philosophy of trial tender of Marange goods was to enable government and industry stakeholders "to make a thorough assessment of the benefits of selling rough diamonds on the open Antwerp market through a trial tender, alongside the regular tenders that are organised in Zimbabwe".

Gudyanga said the response to the trial tender was positive, with 115 clients in attendance compared to the 10 to 15 companies that are present at regular tenders in Zimbabwe.

The trial tender achieved total sales value of US$10,7million which Gudyanga said was consistent with expectations considering the composition of the individual parcels.

This means that 15% (US$1,6 million) will go to Treasury in royalty fee.

Marange diamonds have courted controversy with little or no remittances to Treasury despite the producers selling the diamonds.

In the 11 months to November no money was remitted to Treasury as dividends against a target of US$61 million.

In his 2014 national budget, Finance and Economic Development minister Patrick Chinamasa said President Robert Mugabe had directed Treasury and the Ministry of Mines and Mining Development to institute a raft of reforms that would ensure greater transparency in the diamond industry.

The measures include ensuring surveillance of the entire production, sorting and transmission of diamonds.

There will be tripartite control by the ministry of Finance (through the Zimbabwe Revenue Authority), Ministry of Mines and the mining company over the vault where raw diamonds are deposited.

The Minerals Marketing Corporation of Zimbabwe (MMCZ) will be directed to make deduction of revenues due to the fiscus and pay the same directly into the fiscus.

Diamond production has been on the rise to 12 million carats last year from 1,3 million carats recorded in 2009.

Despite the increase in output, the country has nothing to show for it with former Finance minister Tendai Biti accusing a clique in Zanu for helping themselves to diamond revenue.

"There is no doubt that a small coterie of individuals is benefitting from Zimbabwe's diamonds. Some of us [officials] who are benefitting are not afraid to flaunt our monies. We are buying all kinds of assets," Biti told a diamond workshop last year.

"I am a government minister and earning US$800. How do I buy some of the assets that we are buying? People are now buying private jets because of our diamonds."