Zim has been raking in millions in diamond royalties

via Zim has been raking in millions in diamond royalties IOL Business November 24 2013 By Peter Fabricius

Substantial revenue from Zimbabwe’s Marange diamond fields have evidently been going into state coffers, despite claims to the contrary by former Movement for Democratic Change finance minister Tendai Biti.

This is according to classified documents from the Kimberley Process Certification Scheme (KPCS or just KP) which was set up to filter conflict diamonds (also known as blood diamonds) out of world markets. They show that the four mines at Marange exported over $717 million worth of diamonds between November 2011 and October last year and paid 15 percent of that – just over $107m – in royalties into state coffers.

The KP research was part of the process of clearing Zimbabwe after its suspension from the KP due to reports that its forces had violently evicted informal miners from Marange.

The KP Monitoring Team comprised Abbey Chikane (brother of former director-general in president Thabo Mbeki’s presidency, Frank Chikane) and Mark van Bockstael, chairman of the Working Group of Diamond Experts at the World Diamond Council in Antwerp,

The documents are not public but they are on the KP’s restricted website which is available to any of the many government, industry or civil society members of the KP. This has raised some questions about why they have not been cited before to counter the claims made by Biti.

He frequently said he never saw any Marange revenues while he was finance minister in Zimbabwe’s coalition government from 2009 until this year’s elections, which Zanu-PF won.

The MDC and many observers have often suggested that all income from Marange due to the state went directly into Zanu-PF’s coffers. In their report for the quarter February to April last year, the authors say statements by ministers about the lack of transparency in the “chain of custody” of Marange diamond production and export, “have caused serious confusion regarding compliance to KP standards and minimum requirements.”

They refer to contradictory statements by Zimbabwe’s ministry of mines – then controlled by Zanu-PF – and the finance ministry and agencies then controlled by Biti’s MDC.

Chikane and Van Bockstael found that both the Reserve Bank of Zimbabwe and the Zimbabwe Revenue Authority (Zimra), which is part of the treasury, were both directly involved in authorising diamond exports so they could be KP certified.

Zimra was involved in several steps of the process, including receiving copies of customs forms which showed that the amount paid to the producer, as noted on the KP certificate, had been received in the producer’s bank account in Zimbabwe.

Zimra also had to give clearance for the shipment of the rough diamonds near the end of the process by issuing “Release Form 21”.

Zimra “ thus holds the key to all rough diamond exports from Zimbabwe,” the report says.

“Statements that Zimra is completely unaware of the exports of rough diamonds are therefore alarming as these could indicate that the KPCS-compliant export process for rough diamonds is no longer applied or not applicable in case of rough diamond shipments from Marange.”

However, Chikane and Van Bockstael’s report says further investigation showed that proper process was still being implemented for all rough diamond exports, including Marange, and that Zimra need only check its records to identify how much revenue through royalties had been generated by rough diamond exports.

This week at the annual KP Plenary in Johannesburg, campaigners failed to persuade the KP to block rough diamond exports by rebel movements and exports by governments which exploited diamonds to fuel violence.

Sunday Independent

 

COMMENTS

WORDPRESS: 19
  • comment-avatar

    This still fails to explain why the funds never reached the Ministry of Finance for use by the whole country? Note that the funds were allegedly given to the Ministry of Mines and ZINWA which were both controlled by ZANU-PF during the GNU. If the funds have been remitted all along, then why has the present ZANU-PF Finance Minister also stated that absolutely no diamond funds have reached the general fiscus this year? Where are they? Could it have been that the money was indeed submitted, but ZANU-PF decided to use it to fund their election “triumph?”

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      Matimba 8 years ago

      You don’t understand the way foreign currency is remitted. All the money come thru the central bank.Check your facts

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    Mr Editor please publish this. Zimbabweans, you know who has been misleading us into believing that our endowed country is in this sorry state because of sanctions when we all know that these are targeted sanctions, aimed at punishing named individuals who are well known for being purveyors of injustice, inhuman and degrading treatment of those who hold divergent political views to protect the worst dictatorship since records began. You know that Obert Mpofu as Minister of Mines boasted that our country would not owe anyone anything because we were going to earn so much money from diamonds we would pay off all our debts to the international organisations such as IMF. World Bank and ADB. Tendai Biti used to plead with these people to remit diamond revenue to treasury but there was a deafening silence from those who were supposed to ensure the funds were placed in State coffers. Now tell me. If this report is to be believed where is the money? Why is our country still so poor, in fact poorer than it was before the discovery of diamonds? Who has benefitted? Obviously, not us. Our capital city Harare, which used to be called the sunshine city, no longer has clean drinking water. If you drink water from the tap you know you risk catching any of the deadly diseases. If you then go to Harare or Parirenyatwa hospitals, you know you are not coming back home alive. Zimbabweans, how can such a rich coutry of only 13 million people fail so dismally to have basic needs of its people? Since they always jump to project a positive image of their masters, would George Charamba and Jonathan Moyo please tell us what the government is doing about all these problems. Where is diamond money and what has it been spent on?

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      Matimba 8 years ago

      Iam not sure if you have any idea of what is really going on.

  • comment-avatar

    Biti did not lie. We know who the local and global liars are. Where there muck there’s brass

  • comment-avatar

    Chinamasa recently repeated Biti’s statement that no diamond money has been received by the state so far and he has no money to budget from so who is lying?Diamond is for all Zimbabweans not individuals.Zimbabwe is a rich country but humbimbindoga nehundyire zvauraya nyika iyi.President should tell us the truth.Where is Diamond money?

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    matombo chiremba 8 years ago

    The most important questions to be asked are 1. What evidence is there that the money was paid and indeed reached the state coffers? 2. This is just 15%, we know that government should have been receiving 50% of the revenue through its 50 -50% arrangements with all Marange Diamond miners and where is this 50% of USD 717 million? 3. USD 717 million is just for one year and yet Mining has been going on since 2009 ie four years and therefore we expect nearly USD 3 billion and 50% of that is USD 1.5 billion and where is that money? Chinamasa also says he has no evidence of diamond money remittance and so the question remains; Where is the money, in whose bank account?

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      Obert Mpofu probably has some explaining to do to the people if Zimbabwe.

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      During the inclusive Government there were suggestion that Zanu PF was running a parallel economy. This would explain who’s pockets the monies went to.

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    leonard maswanhise 8 years ago

    Mari ndeyedu tose vana veZimbabwe.Buritsai mari.God will punish you for making the children of Zimbabwe suffer when he gave them enough.Chinamasa and Biti are both saying no money has been received by the state so where is the money Mr President?

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    Bruce 8 years ago

    Ministry of Finance headed by Biti does not have Bank where money was banked, but its at the RBZ, which happened to be under ZANU PF man, same with ZIMRA, the involvement of Gono and Pasi who are Mugabe’s man does not make it accessible to Biti. So please give more evidence of Ministry of Finance having control over that money.

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    hater 8 years ago

    the G.V.t is all corrupt

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    gorongoza 8 years ago

    The wriyter is mixing up issues here. Authorising diamond exports is different from receiving the proceeds from diamonds. With diamonds you do not receive your money the day you export. They will need to be valued and auctioned according to their quality (clarity, shape etc) The CD1 form only has an estimete based on MMCZ and the company’s valuation, but not the real figure. All monies are received by the selling company, not by MMCZ, ZIMRA or RBZ. ROyalties are taxes and the company is the one that pays on the basis of the final value of the export. If the the company gives that to a different arm of govt, then treasury can not say they received money. Biti and the treasury accounted for the money they received and made it public. Obert Mpofu was asked and never gave a satisfactory answer and we can only assume he knows which “arms” of govt received the money. Maybe his personal arom of “govt”!

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    Mapandagwara 8 years ago

    Hypocracy and sweet talk is all there is to this. This is not about the people of Zimbabwe. It is about dipping hands in the pocket that carries the diamonds. If the millions of dollars found their way into state coffers, why is it not showing. If I was youthful, I was gonna take matters into my hands in a way that might be considered bad by all those that benefit from the bad things happening to Zimbabwe, I would almost change that country’s name, so fed up of this I’ve become.

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    Valour Museyamwa 8 years ago

    ZANU PF imbwa dzavanhu. Imbwa mbwa mbwa mbwa mbwa. Dogs dogs dogs.

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    Chara 8 years ago

    Its clear as day light if Biti was lying herald, Sunday mail etc. were going to be the first to bark before Jonathan Moyo also added his voice but Biti was telling the truth.WHERE IS THE DIAMOND PROCEEDS?

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    Chara 8 years ago

    Its clear as day light if Biti wasn’t lying herald, Sunday mail etc. were going to be the first to bark before Jonathan Moyo also added his voice but Biti was telling the truth.WHERE IS THE DIAMOND PROCEEDS?

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    Matimbe go a little higher up Mugabe arse you might strike gold

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    shasha 8 years ago

    financial discipline is key for our Zim to start performing better. Where is the diamond money? Lets all benefit from diamonds not only those in power? You will be made to account one day.