Business / Economy
Zimbabwe government suspends local diamond sales
06 Jul 2011 at 04:26hrs | Views
The Zimbabwe government has suspended local diamond sales after it emerged that some players in the diamond cutting and polishing industry were abusing their licences by trading in raw gems and flouting their primary value addition mandate.
There are 10 companies licensed to buy diamonds locally. The Minerals Marketing Corporation of Zimbabwe started selling diamonds from Chiadzwa to local companies for cutting, polishing and export in December last year.
This was in line with Statutory Instrument 157 of 2010 that stipulated that 10 percent of diamonds mined in the country should be offered for beneficiation to local companies. However, some firms started abusing the facility, leading to the ban.
"We were directed by the Ministry of Mines and Mining Development to stop selling diamonds to the local industry. This followed the suspension of diamond cutting and polishing licences by Government recently.
"All licences have been nullified because of abuse of the system by players in the local industry. We will not sell diamonds locally until the industry is regularised," said an official at MMCZ.
MMCZ is responsible, among other things for the marketing and selling of all the country's minerals except gold.
Mines and Mining Development Secretary Mr Thankful Musukutwa yesterday confirmed the development in an interview with The Herald, but would not give further details.
"It is true they have been suspended," he said.
Pressed for further details, Mr Musukutwa hinted that the suspension had to do with the alleged abuse of licences by players in the local diamond cutting and polishing industry.
Government had licenced 10 diamond cutters and polishers in a bid to add value to the country's gems.
However, some of the licenced dealers started trading in raw material diamonds flouting their primary mandate of value addition.
Government launched investigations last month with Mines and Mining Development Minister Obert Mpofu, warning that those found guilty would have their licences cancelled.
Currently, ministry officials are carrying out an inspection of the licence holders to evaluate compliance.
"Inspections are going on although this time they were triggered by misconduct of some players, whom we are weeding out. Licencing will resume after the exercise," said Minister Mpofu last month.
The MMCZ had sold 5 318,90 carats of rough diamonds worth US$2 303 339,90 between December (2010) and February this year to 10 local companies.
Selling of the gems to local diamond cutting and polishing companies was expected to create employment outside diamond mining.
The country will also derive maximum benefit from the Chiadzwa diamonds if they are exported as finished products.
Before sales were suspended, the diamonds were being sold to local companies using the diamond commodity pricing system
Diamonds from Chiadzwa are also being sold to foreign buyers through the auction system.
There are 10 companies licensed to buy diamonds locally. The Minerals Marketing Corporation of Zimbabwe started selling diamonds from Chiadzwa to local companies for cutting, polishing and export in December last year.
This was in line with Statutory Instrument 157 of 2010 that stipulated that 10 percent of diamonds mined in the country should be offered for beneficiation to local companies. However, some firms started abusing the facility, leading to the ban.
"We were directed by the Ministry of Mines and Mining Development to stop selling diamonds to the local industry. This followed the suspension of diamond cutting and polishing licences by Government recently.
"All licences have been nullified because of abuse of the system by players in the local industry. We will not sell diamonds locally until the industry is regularised," said an official at MMCZ.
MMCZ is responsible, among other things for the marketing and selling of all the country's minerals except gold.
Mines and Mining Development Secretary Mr Thankful Musukutwa yesterday confirmed the development in an interview with The Herald, but would not give further details.
"It is true they have been suspended," he said.
Pressed for further details, Mr Musukutwa hinted that the suspension had to do with the alleged abuse of licences by players in the local diamond cutting and polishing industry.
Government had licenced 10 diamond cutters and polishers in a bid to add value to the country's gems.
Government launched investigations last month with Mines and Mining Development Minister Obert Mpofu, warning that those found guilty would have their licences cancelled.
Currently, ministry officials are carrying out an inspection of the licence holders to evaluate compliance.
"Inspections are going on although this time they were triggered by misconduct of some players, whom we are weeding out. Licencing will resume after the exercise," said Minister Mpofu last month.
The MMCZ had sold 5 318,90 carats of rough diamonds worth US$2 303 339,90 between December (2010) and February this year to 10 local companies.
Selling of the gems to local diamond cutting and polishing companies was expected to create employment outside diamond mining.
The country will also derive maximum benefit from the Chiadzwa diamonds if they are exported as finished products.
Before sales were suspended, the diamonds were being sold to local companies using the diamond commodity pricing system
Diamonds from Chiadzwa are also being sold to foreign buyers through the auction system.
Source - Byo24News
