'$550m worth of Zimbabwe diamonds stolen,' says Tsvangirai

Opposition leader Morgan Tsvangirai has said Zimbabwe's diamonds are a curse as proceeds from the sale of the gems have not benefited the country, with over $550 million unaccounted for in 2012.

Delivering a lecture at Oxford University in the United Kingdom yesterday, Tsvangirai said diamond revenue has been used to oil State machinery to stifle democracy while the majority of Zimbabweans languish in abject poverty.

"The secrecy and lack of transparency in the diamond mining industry has resulted in serious leakages and failure to remit satisfactory revenues to the State," Tsvangirai said. "While the minister of Finance expected $600 million from the proceeds of diamond exports in 2012, the State only received about $41 million.

"This is against reported sales of diamonds running into billions of dollars every year," he said.

According to an international non-governmental organisation, Global Witness, about  $2 billion in diamond revenues have been unaccounted for since 2008.

This comes as questions have been raised as to where all the money went and who benefited, as most Zimbabweans remain mired in poverty, with government coffers short on funds to build and maintain the nation's roads, clinics, utility services and schools.

"In 2012, our (former) minister of Finance was forced to revise his $4 billion national budget to $3,4 billion after the $600 million expected from diamond sales did not materialise," said Tsvangirai.

Godwills Masimirembwa, ex-chairman of state-owned Zimbabwe Mining Development Corporation (ZMDC) - which jointly operates mining companies in Marange - has persistently denied the theft charges, and said diamond sales were $700 million, of which 15 percent was paid as royalties to revenue collector Zimra at the diamond auctions.

The MDC leader noted that the continued diamond mining leakages and lack of transparency in the sector has increased the gap between the minority that are extremely rich and the majority who remain poor while at the same time fuelling the undermining of democratic processes.

He added that the poverty endemic in the Marange diamond fields was not consistent with the value of the diamonds extracted from their land.

"It is displeasing how a people can continue to wallow in poverty in the midst of a treasure benefitting the well-heeled and the well-connected in government," he said.

Zimbabwe is the world's fourth-largest diamond miner, producing an estimated 17 million carats this year, according to the Kimberley Process, which is charged with ensuring that gems reaching world markets are not "blood diamonds."

Tsvangirai said since the discovery of the gems in 2006, President Robert Mugabe's Zanu PF has used the diamond proceeds to stifle democracy in the country.

"The overall impact of the diamond industry so far has been to derail the democratisation process through the overt involvement of the military, corruption and the emergence of a parallel economy that has fuelled illegal and underhand dealings impacting on the electoral processes," he said.

"Through this parallel economy, Zanu PF has large amounts of cash giving it the ability to manipulate the electoral process and subvert the will of the people through payment of shady consultancies to perform election-related work, the refusal to support the Treasury in its developmental work simply because it was MDC-controlled and the deliberate porosity and leakages in this sector."

The former premier argued that diamond mining should benefit the communities in which mining is taking place and the people of Zimbabwe in general, including disadvantaged groups such as children and the disabled.

"The militarisation, violence and power dynamics associated with the diamond industry are generally against any measures that are likely to promote women's participation and their interests," he said.

Tsvangirai said there was need for beneficiation and value addition to the country's diamonds in order to create more revenue, build industry and create jobs in Zimbabwe.

"This would assist in reducing the high unemployment levels currently pegged at almost 90 per cent. It will also enhance the country's revenues by promoting the export of higher-value goods than the current practice where emphasis is on cheap raw materials," he said.