The government of Zimbabwe, in particular President Robert Mugabe and Mines Minister Walter Chidhakwa have at long last confessed that the diamond mining companies in Marange have robbed Zimbabwe of at least $15 billion.
These confessions, though belated, are important as they confirm what CNRG has consistently claimed – that Zimbabwe’s diamond sector was designed to benefit the country’s ruling elites, including the top military brass, at the expense of the nation. The choosing of shelf companies with opaque shareholding structures and military connections to mine such lucrative diamond fields was a harbinger of worse things to come.
President Mugabe claimed that ‘well over 15 or more billion dollars’ have been lost since the entry of capital in Marange. President Mugabe’s claims cannot be said to be exaggerated since he is privileged with intelligence information generated by state officials who had access to Marange. His claims also corroborate claims made by former mines Minister Obert Mpofu in November 2011 shortly after the export ban imposed by the Kimberly Process Certification Scheme had been lifted. Obert Mpofu promised to deliver $2 billion in gross revenues from diamond exports annually (Thornhill, 2011). Mpofu’s estimate of $2 billion potential annual revenues means Zimbabwe could have lost 10 -15 billion since 2009. Former Finance Minister Tendai Biti and Member of Parliament for Bulawayo South Eddie Cross both agree with President Mugabe that approximately $15 billion was stolen from Marange.
In 2008, at the height of artisanal mining in Marange, the then reserve Bank Governor Gideon Gono estimated that the government was losing $1.2 billion a year to artisanal miners. Gono performed two roles in the Marange diamond rush which gave him first-hand experience on the volume of illicit trade involved. First he was at the helm of RBZ when the Central Bank purchased diamonds from artisanal miners in Marange between 2006 and 2007. Secondly, Gono is mentioned in a US diplomatic cable that he personally dispatched his agents to buy diamonds for him from artisanal miners.[1] This means Gono’s estimate was not a wild guess but rather was drawn from the statistical data gathered from his involvement in Marange. If therefore artisanal miners could earn in excess of $1.2 billion annually then mining corporations could earn even more using high tech equipment and with access to markets.
It is therefore accepted that diamonds worth plus or minus 15 billion dollars were stolen from Marange. There are many questions than answers on how government allowed this looting to go on for so many years. Further, with government owning 50% shares in all the diamond mining companies except in Marange Resources where it had 100% ownership, it is dishonest on the part of government to blame the ‘companies’ and distance itself from a process they initiated and fully participated it. It was the Executive that corruptly invited the corporations to Marange, arm twisted regulations to license undeserving entities, undermined state institutions through diversion of revenues, denied Zimbabwe’s Parliamentary Portfolio Committee on Mines and Energy access to Marange on two occasions and shielded the thieving corporations from public scrutiny through anti-sanctions rhetoric and state propaganda. It was clear the bubble would burst at some point. Government must take full responsibility for the Marange plunder as the looting was initiated an aided by the government.
Some are calling on Zimbabwe to observe the KPCS minimum standards. However the KPCS was complicit by way of certifying and indeed sanitizing the Marange diamond looting. If the government was not in control of Marange diamond revenues, as admitted by President Mugabe and highlighted by former Finance Minister Tendai Biti, then questions arise on how and why the KPCS would certify such diamonds as ‘conflict free’. The KPCS connived with Zimbabwe’s ruling elites and diamond mining firms to undermine state institutions in Zimbabwe by sanitizing illegal mining and exportation of Zimbabwe’s diamonds. In 2013 the EU which also chaired the KPCS Working Group on Monitoring lifted sanctions on Zimbabwe Mining Development Corporation to facilitate the entry of Zimbabwe’s diamonds into Europe despite the overwhelming evidence that Marange diamond revenues evaded central government control. Thus the KPCS is part of the problem in Marange and certainly not the solution.
It is our hope that President Mugabe’s confession that $15 billion was looted from Marange was not just a political statement meant to justify the overthrow of one looting gang by another but rather a genuine discovery that must trigger action to hold the perpetrators accountable. Marange diamonds are a national asset that must not be trivialized to settle political scores. $15 billion is a huge sum that must warrant domestic and international investigation. The involvement in Marange of mysterious international criminals such as Sam Pa, who has a ruinous footprint in unstable African countries suggest Marange diamonds were subject to organized crime which include money laundering, undermining the smooth running of a legitimate government and possibly financing terrorism. Sam Pa, who uses several aliases which include Sampa, Xu Songhua, Sa Muxu, Samo, Sam King, Xu Jinghua, Ghui Ka Leung Tsui King Wah, Ghiu Ka Leung, Sam King, Antonio Famtosonghiu Sampo Menezes, was arrested in China last October for as yet unclear reasons.
The Zimbabwe government must also explain how private planes were allowed to land in Marange and depart without ever being searched to determine the quantity, volume and value of the diamonds they were exporting.
To show the nation that he is indeed grieved by the loss of $15 billion to organized crime and determined to lead Zimbabwe from this economic Bermuda Triangle, President Robert Mugabe must urgently do the following:
- Set up an independent commission of inquiry to investigate what transpired in Marange right from the time mining licenses were issued to the present and make recommendations on how best to plug the leakages. The commission’s report must be made public within a reasonable timeframe, say one month after its submission to the President.
- Allow and capacitate the Commission to carry out extra-territorial investigations to locate foreign syndicates who participated in the criminal activities involving Marange diamonds
- Carry out a forensic audit of all the diamond firms in Marange and investigate the marketing and sale of Zimbabwe’s diamonds
- Authorize the Police and Anti Corruption Commission to collaborate and prosecute those individuals and syndicates that participated in the plunder.
- Re-visit the 2013 Chindori Chininga report on Diamonds. This report was never fully debated in parliament despite it having the key to unlock the Marange potential.
In the meanwhile government must cease all mining operations and keep the remaining diamonds in the ground till a salubrious new mining regime has been established. The $15 billion Marange loss demonstrates that there is no wisdom in extracting a precious resource when sound governance policies are not in place. Doing so will benefit a few connected individuals at the expense of the whole country.
There is a re-emergence of police brutality against Marange villagers and artisanal miners. Police midnight raids in people’s homes and beatings of citizens must be stopped. CNRG calls on government to exercise restrain when dealing with citizens who are driven into artisanal mining by joblessness and abject poverty. CNRG condemns in the strongest terms the abuse of citizens by the same government that deployed the army and police to guard mining corporations that looted diamonds worth over $15 billion.
Contact Details
Centre for Natural Resource Governance
90 Fourth Street, Harare
Email: farai@cnrgzim.org
0715387417
[1] Classified US diplomatic cable By: Ambassador James D. McGee for reason 1.4 (d)
