12:07 GMT 31st January 2012
Coming against a background of Zimbabwe's controversial land reform programme that pitted the government against the US, Canada and the EU, the KP's approval was sweet victory for Zimbabwe's political elite. Indeed, the government managed to portray the diamond certification as a battleground in which a powerless African nation was being harassed by western imperial interests. Race also came to the fore - it was claimed the US and its allies were upset that such large diamond deposits were controlled by a black government.
Thus, the majority of African countries in the KP process took sides with Zimbabwe at the KP Plenary session, held in Kinshasa, Democratic Republic of Congo. Having been involved in diamond extraction despite the absence of KP certification, China also sympathised with the Zimbabwean cause. In the end, the vexed issue ended up threatening to tear apart the fabric of the KP process. Confronted by the prospects of the KP's demise, the US, Canada and EU compromised. As stated by Victoria Nuland, a State Department spokesperson, the US abstained from the vote but chose not to block the deal in which diamonds from Zimbabwe's Chiadzwa fields can be exported with provisions for KP and civil society oversight. Speaking for her country's long term interest, Nuland said, 'We think this compromise might have been stronger and that's why we abstained ... We judge that rather than having the entire Kimberly process deadlocked over Zimbabwe, we would abstain, we would let this go forward.' And so Zimbabwe got the green light to trade in its diamonds on the world market.
According to Obert Mpofu, minister of mines and mineral development, the decision places the country on the path of economic recovery in which the effects of the 'sanctions induced' economic crisis are set to be reversed. Addressing the media after the landmark KP announcement, he said, 'This is a historical development we all had been waiting for. We want to shock and shake the world. We are going to unleash our worthiness to the world and Zimbabwe will not beg for anything from anybody again.'
Statistical projections appear to bolster the minister's statement. Zimbabwe is set to earn $2bn and more from diamonds on an annual basis, which could turn it into the world's largest diamond producer as well as contribute up to 50 per cent of the country's GDP. Having earned $334m in diamond revenues last year, it is currently ranked seventh in the diamond league of nations. Edie Cross, the opposition Movement for Democratic Change (MDC) policy adviser told parliament recently that Zimbabwe's current annual diamond production could well be over $4bn. The world's current top producer Botswana raked in $2.5bn in 2010.
As reported by South Africa's Sunday Times, the period leading to the latest KP approval has seen the Zimbabwean treasury receiving monthly earnings of $30m from diamond sales. Yet there is not much to show for this. The socio-economic gains of the first 10 years of independence have continued to be eroded. A good example relates to the education sector. In a recent monetary policy statement, finance minister Tendai Biti stated that 555 primary and 399 secondary schools have no desks. The textbook to pupil ratio stands at 1: 15 and at least 26 per cent of primary schools are in dire need of repair. The government is also failing to adequately remunerate staff, with qualified teachers paid not more than $350 in monthly salaries.
Despite the hard-pressed economic conditions, the government recently splashed $20m on Mercedes Benz, Land Rover Discovery 4, Jeep Grand Cherokee and other luxury vehicles for ministers, senior civil servants and MPs. The military is also benefiting immensely. This includes the new $76m defence college that is being built by the Chinese through a diamond backed deal. 'The [KP] deal is a blank cheque for the continued looting and benefit of the privileged few,' remarked Farai Maguwu, director of Zimbabwe's Centre for Research and Development. Last year Maguwu was arrested after revealing human rights abuses and looting of diamonds by politicians and soldiers in Chiadzwa.
On human rights abuses that have previously been the basis for denying Zimbabwe KP certification, Maguwu said, 'The deal does not protect the Chiadzwa community from abuses. It is silent on human rights abuses.
Neither does it call on Zimbabwean authorities to protect the Chiadzwa community.' Security has remained an issue, with soldiers being reported to be continually patrolling the non-commercial areas of the Marange communal area in which Chiadzwa is located.
The deal also fails to address the need for greater transparency in the mining of the Chiadzwa diamonds. So far, mining has been conducted in extreme secrecy, with reports that the police and the army have also been granted mining concessions. In August last year, the Zimbabwe parliamentary portfolio committee on mines and energy was barred from entering the Chiadzwa diamond mining fields where it intended to carry out a probe, as required by parliament. At the time, MPs were raising serious concerns about the situation there.
In the wake of the KP approval the committee's chair, Chindori Chininga, said, 'The diamond issue remains an outstanding issue with the committee as the visit to Chiadzwa diamond fields by parliament has not been done yet.' Even Biti is in the dark as to the actual amount of revenue being raised through diamond mining. In August he told Zimbabwe's weekly Financial Gazette that revenue estimated to the tune of $1 bn had been lost through shady diamond mining activities and deals. Biti has since called for new laws that would make the diamond industry more accountable.
The legislation should also spell out how local communities can effectively benefit from the country's diamonds, observers say. Otherwise, valuable earnings that could significantly contribute to the transformation ofthe Zimbabwean economy will continue to be lost through corruption and the smuggling of diamonds. The rampant smuggling into countries such as Zambia and Mozambique was recently confirmed by Mpofu during a press conference following KP's Kinshasa plenary session.
There is also serious concern that Zimbabwe's diamonds could be a source of political instability in the SADC region. As Cross recently said, 'Diamond money that is in wrong hands is enough to destabilise regional governments that differ with the Zanu PF leadership who control the flow of diamonds and the revenue that emanates from it.'
Without addressing the cancer of patronage, corruption, lack of transparency and other revenue leakage points, Zimbabwe's alluvial diamonds are set to continue benefiting a few political and military elites at the expense of the majority. Regional stability is also in jeopardy as Zimbabwe's political and military elites cling on to the riches flowing from the Chiadzwa diamond fields.
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