Zim engages four diamond cutters

via Zim engages four diamond cutters – DailyNews Live 20 April 2015 by Ndakaziva Majaka

HARARE – Zimbabwe has engaged four international diamond cutting and polishing firms as part of the country’s strategies to add value to its natural resources.

President Robert Mugabe told thousands of party supporters on Saturday that the move will help boost revenue earnings and employment creation in the country.

“To encourage value addition and beneficiation in this sector, government has secured the services of four reputable diamond cutting and polishing companies, while measures are being put in place to set up a local base metal and platinum refinery,” Mugabe said.

This comes as Zimbabwe has been criticised for exporting raw diamonds, a situation economic analysts say is depriving the country maximum benefits from its gems.

Last year, the Centre for Natural Resource Governance said government continued to export thousands of jobs annually through the export of rough diamonds, frustrating the fledgling local cutting and polishing industry.

“Centre for Natural Resources Governance believes Zimbabwe can create over

210 000 jobs and generate over $8 billion in revenue annually if a significant percentage of its rough diamonds were cut and polished locally,” said the organisation.

Mugabe said one of the companies is expected to start operations this year, while three others are expected to commence operations next year.

Zimbabwe is believed to have more than 25 percent of the world’s gems, but recent reports indicated that alluvial diamonds were fast running out in Marange, however, government refutes the claims.

The country sells its diamonds in their rough form as it currently has no capacity to process them.

The Antwerp World Diamond Centre last year revealed that Zimbabwean diamonds had the capacity to fetch over $400 million annually, resulting in an increase of $60 million of royalties per year.

Prior to trading in Antwerp, Marange gems were traded at other diamond centres, at an average price of $47 per carat, resulting in an average return on investment for the Zimbabwean Treasury of $7,05 per carat.

Since the European Union lifted sanctions on the Zimbabwe Mining Development Corporation (ZMDC), the country has earned over $80 million in two auction sales.

However, the selling of Marange diamonds on the international market has been slammed by local industry experts.

Meanwhile, Mugabe also said the move to compel diamond companies into a single entity was to “enhance the supervision of the economy” despite stiff resistance from diamond miners in the country.

Currently, Rio Tinto (Rio), which has a 78 percent stake in Murowa Diamonds, and Russia’s DTZ Ozgeo are yet to agree on Zimbabwe’s mandatory merger of diamond firms, with the two seeking clarity on the proposal.

Government already owns 50 percent in most of the mines operating in the Marange fields on the eastern border with Mozambique including Marange Resources, Diamond Mining Company (DMC), Anjin, Jinan, Mbada Diamonds and the now defunct Gye Nyame Resources which is under final judicial management.