Zimbabwe diamond wealth finding way to ‘pockets of a few’

A FEW hundred metres from the sandy tracks of Sakubva township in eastern Zimbabwe, Chinese workers are putting the finishing touches to a luxury hotel most locals can only dream of staying in.

With its chandeliers, rose-studded tables and junior executive suites, the Golden Peacock Villa Hotel is the latest hideout of strongman Robert Mugabe’s diamond barons.

Two men hammer away at pale benches near a red pagoda-style shelter. Built next to an airstrip that offers easy access to the Chiadzwa diamond fields less than 60 miles away, a night in a “villa” here costs £577.

The 88-year-old president was at the commissioning of the Golden Peacock last week, telling guests the hotel “provides clear evidence of downstream benefits flowing from the diamond mining.” But critics say the benefits are only flowing in one direction – to Mugabe’s cronies.

The hotel has been built in record time by Anjin, a firm jointly owned by the Zimbabwean and Chinese military and so hampered by Western sanctions – so the official line goes – that it has not been able to hand over a penny to the treasury this year.

“They are not remitting, not even a single cent,” finance minister Tendai Biti of the opposition Movement for Democratic Change (MDC) told Zimbabwe’s Independent on Friday.

Mr Mugabe’s military took control of the Chiadzwa fields in late 2008, killing around 200 illegal panners in an operation the authorities said would harness Zimbabwe’s newly-found diamond wealth to rebuild its shattered economy.

The finance minister based his 2012 budget calculations on anticipated diamond inflows of around £365 million this year. However, so far, according to MDC leader Morgan Tsvangirai, only £16m has been remitted from the four firms operating in Chiadzwa.

Mr Biti now has the job of telling civil servants that he can’t hike their salaries, as is traditional every July. Neither will he be able to pay the 4,600 soldiers hired by defence minister Emmerson Mnangagwa ahead of elections in less than a year.

Officials linked to the diamonds are living large.

Take the man who selected which firms to allow into Chiadzwa, mines minister Obert Mpofu. He has just bought a bank. The Zimbabwe Allied Banking Group (ZABG) cost Mr Mpofu’s Trebor Khays company £14.6m, state media says. Mr Mpofu’s ministerial salary is around £513 per month. He said that he’d built his fortune by simply “borrowing” money.

Another Mugabe ally, Robert Mhlanga, the chairman of the board of Mbada Diamonds in Chiadzwa has spent £15.2m on a mansion in South Africa’s seaside resort of Ballito, the local Saturday Star claims.

Another top Zanu-PF politician has just splashed £3.5m on an Italian yacht.

“There is a huge amount of unaccounted-for wealth,” says Dewa Mavhinga of the Crisis in Zimbabwe Coalition. “The [diamond] money is going into the pockets of a few individuals.”

Mbada Diamonds takes a hardline approach to questions: when tax officials arrived at its office in May, they were chased away.

With polls looming, the links between diamond firms and the Zanu-PF controlled military are a real cause for concern. Says Mavhinga: “[Diamonds] could be used to fund the war chest and mount a violent election campaign.”