Mugabe set to cash in on diamonds

via Mugabe set to cash in on diamonds Telegraph, London, DPA September 19, 2013

Britain has been accused of virtually handing Zimbabwean President Robert Mugabe millions of dollars after agreeing to lift European Union sanctions on diamonds.

All restrictions on Zimbabwe Mining Development Corporation (ZMDC), a state-owned company which controls one of the world’s biggest diamond fields, will be removed when EU foreign ministers meet next month.

The move comes despite lingering questions about the fairness of elections in Zimbabwe last month, in which Mr Mugabe won a seventh term in office.

After the elections, a body representing southern African nations called for an end to Western sanctions against Zimbabwe.

“There is no indication that ZMDC’s activities were linked to any acts of violence during the election period,” said EU spokesman Michael Mann.

EU ambassadors had decided to begin the process of lifting sanctions against ZMDC, Mr Mann said. The decision still needs to be formally adopted.

Large sums raised from Zimbabwe’s diamond sales go unaccounted for. Last year, the country exported diamonds worth $601 million, but only $44.25 million was paid to the finance ministry. What happened to the rest of the money is unclear. Campaigners believe much of it entered the pockets of senior regime figures, or went to a network of companies controlled by Mr Mugabe’s ruling Zanu-PF party.

“The reality of the situation is the UK government dropped the ball on this,” said Emily Armistead, a researcher from Global Witness, a campaign group.

“They seem unwilling to look properly at the evidence which suggests that diamond companies have funded election-rigging.”

The decision to allow ZMDC to sell diamonds to Europe would in effect place hundreds of millions of dollars of extra revenue in Mr Mugabe’s hands, she said.

Most of Zimbabwe’s diamonds come from the Marange field, which was discovered in 2006.

At first, the stones were illegally mined by thousands of workers.

In 2008, Mr Mugabe sent about 1500 troops, backed by helicopter gunships, to clear the area. Hundreds died in an operation code-named “Hakudzokwe”, or “You Shall Never Return”.

Zimbabwe’s diamonds were cleared for export by the Kimberley Process, which is supposed to prevent tainted gems from entering the international market.

A spokesman for Britain’s Foreign Office said: “We have agreed to de-list ZMDC because we believe it’s important that EU member states should work together and maintain a united position on Zimbabwe.”