Mugabe's vows on diamond wealth share are tarnished

Published on Sunday 15 August 2010 16:06

Restless Zimbabweans are clamouring for a share of the diamond pie after the first legal sale of 900,000 carats worth from the contested Chiadzwa fields last week - but officials from the former opposition party warn they will be disappointed.

Finance Minister Tendai Biti of the Movement for Democratic Change (MDC) has revealed that Zimbabwe's starved coffers "would have done well" to get just 9.6 million from Wednesday's high-profile sale of Kimberley Process-certified conflict-free gems in Harare.

On Friday, Mr Biti contradicted expansive estimates of proceeds from President Robert Mugabe's side of the government.

The inaugural sale raised a total of 29 million, not the 46m announced by Mines Minister Obert Mpofu, said the finance minister. Before the sale, Mr Mpofu claimed it would rake in more than 1 billion.

That kind of downward revision isn't what Zanu-PF wants Zimbabweans to hear.

The president's side of the regime is deliberately overstating the potential benefits to the public of the diamond sales, dangling the promise of a massive wealth-share before the noses of thousands of state workers.

But with revelations that the government is in line for little more than a royalty of up to 10 per cent on gross sales, plus a dividend from the Zimbabwe Mining Development Corporation, the state's mining investment vehicle, Prime Minister Morgan Tsvangirai has urged locals to be "realistic" about what they stand to gain.

Few, it seems, are listening. Whetting appetites, piles of diamonds from Chiadzwa were shown on state TV for the first time last week. The authorities have been secretive about the gems until now, with Mugabe himself complaining in March that he "hadn't seen a single diamond from Chiadzwa".

Mr Biti has already laid out his plans for the 18-month-old coalition government to get more benefits from the gems. The finance minister told parliament in July that there had to be a new "Diamond Act" to ensure all income from alluvial diamonds was transferred into state coffers.

The Treasury has no record of 19m worth of diamonds sold by the ZMDC earlier this year, Mr Biti said - a revelation Mr Mpofu dismissed as "hot air."

Mr Mpofu's personal assistant and the president's wife, Grace, sit on the board of one of two South African firms selected by Mr Mpofu to exploit the Chiadwa/Marange claim.

On Thursday, the New York-based Rapaport Diamond Trading Network warned its members not to trade in Kimberley-certified Marange diamonds because of persistent blood diamond fears.

Zanu-PF will no doubt use this ban as evidence of more "evil" sanctions from the West - while ensuring Mr Tsvangirai and the MDC as junior coalition partners bear the brunt of public disappointment at the diamonds' failure to bring real change.