This is the last installment of a three part series covering Zimbabwe's Diamond mining and the controversy around it.Officially Zimbabwean diamonds make up a small percentage — approximately 0.4% — of the World diamond trade, according to an industry group, the World Diamond Council.In recent weeks, it has become clear that blood diamonds funding murder, forced labor, rape, and political oppression in Zimbabwe are reaching global consumer markets labeled as “conflict-free.” Zimbabwe is reluctantly engaging the Kimberly Process to certify the Diamonds as "conflict free" to allow the country to get maximum benefits from its Diamond resources.Uncertified diamonds end up on the black market and the proceeds usually end up in the underground economy whilst the nation remains poor.
It is important that Zimbabwe becomes part of the Kimberly Process (KP) as this will aid in accountability and accurate statistical data collection of the quality and quantity of diamonds mined.Most countries that comply with the Kimberley Process also adhere to the World Diamond Council's System of Warranties. This safeguard requires sellers and suppliers to provide written guarantees that say their diamonds aren't tied to war efforts based on their "personal knowledge." This process is critical in isolating ill-gotten diamonds.
Largely due to China and India , demand for diamonds is recovering after an earlier collapse and prices have recovered as China's population has urbanised and becomes more affluent young women have happily latched onto the old marketing adage that "diamonds are forever".This has created a huge opportunity for nations such as Zimbabwe who can supply the World market to meet that demand.
Human Rights Watch has been watching Zimbabwe's diamond trade for a while.“The police and military have been given access to Marange’s mineral wealth at a time when the government has struggled to pay their wages,” reads the HRW report. “Human Rights Watch’s research suggests that revenue from the gems has also enriched senior ZANU-PF [President Robert Mugabe’s Zimbabwe African National Union – Patriotic Front] officials and provided an important revenue stream for the Reserve Bank of Zimbabwe, which has underwritten some military operations.”
The KP is made up of three types of groups: member states, representatives of the diamond industry and human rights organizations. These groups try to work together to ensure that consumers know that the diamonds they purchase are not funding violence or causing grave human rights violations.Zimbabwe's diamond industry is still in its infancy and would require the assistance offered by KP in terms of setting up systems and mechanisms that ensure transparency in the diamond extraction chain.This chain will assist in tracking proceeds such that local communities benefit from the diamonds.
Currently most of the communities around Chiadzwa remain poor despite being the source of the diamonds and without any prospects of ever being developed.This problem is directly related to lack of accountability and diamond smuggling which could be minimized by the KP membership.
Udi Shintal, director-general of the Israel Diamond Manufacturers Association, said it was important to keep Zimbabwe in the process.
“The problem won’t be solved if Zimbabwe exits the process, they will just move to operating on the black market. Such a move would harm other diamond miners in the country [Zimbabwe] that are in compliance with the process. It is important to find a balance,” he said.
India and Belgium trade in diamonds although not producing much themselves. Zimbabwe should take advantage of its current position as centre of attraction and use this position to secure a secure place on the diamond business.The best option would be for Zimbabwe to accept responsibility and move toward compliance by itself and work towards developing other related areas such as jewellery manufcturing.
Zimbabwe should focus on finding niches within the downstream aspects of the diamond industry to add more value to its economy.Once the country starts trading in the rough diamonds it will have the flow of diamonds from all over the world. This will assist Zimbabwe to develop into an important diamond trade centre.
Acknowledgements and Sources
- African Diamond Council ,
- Kimberly Process ,
- Partnership Africa Canada
- World Diamond Council
- GMRI Capital Research
This article appears as courtesy of GMRI Capital ( http://www.gmricapital.com ) prepared for 3MG MEDIA
Gilbert Muponda is a Co-Founder of 3MG Media - ( http://www.3mgmedia.ca ) . He can be reached at;
Email: gilbert@gilbertmuponda.com . Skype ID: gilbert.Muponda
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