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ZIMBABWE’S annual diamond exports declined to 5,9 million carats last year from 8,9 million carats in 2013 after exhaustion of alluvial diamonds in Marange, figures from the Mineral Marketing Corporation of Zimbabwe (MMCZ) revealed. The decline comes at a time government is planning to bring all diamond mining operations in the country under one firm in which the State will have a 50 percent shareholding. The plan was tabled before Parliament last week by Mines Minister Walter Chidhakwa, who said government was being prejudiced of revenue by diamond miners and wanted to ensure consolidation of all diamond mining companies to stem leakages.

The consolidation will not only involve companies mining in Marange as initially planned Murowa Diamonds and any other diamond mining operations across the country will be involved in the unprecedented integration of gem companies. It was not clear how companies that have been managing their businesses well will be rewarded in the proposed integration, which will include some mining ventures that have even evaded both Treasury and tax scrutiny over the years.

Chidhakwa said while some mining companies had run out of alluvial diamond deposits at some concessions allocated to them, Zimbabwe still had viable reserves of the precious stones. He told a Parliamentary Portfolio Committee on Youth, Indigenisation and Economic Empowerment that the State would own 50 percent of the new entity, which would include seven miners in Marange. “At some point we started by saying we will first merge Gye Nyame and Kusena concession into Marange. But we have realised that it is actually better just to bring everybody together in the first instance,” Chidhakwa said.

Gye Nyame Resources, a joint venture between the state-owned Zimbabwe Mining Development Corporation (ZMDC) and Bill Minerals had its licence revoked last year due to insolvency and failure to adhere to environmental requirements.

Other miners in the Chiadzwa area include Marange Resources, Diamond Mining Company, Anjin, Jinan and Mbada Diamonds. Last year, Zimbabwe’s mining industry is estimated to have declined by -2,1 percent due to decline in diamond exports, frequent power outages, obsolete equipment, inadequate funding for recapitalisation and weak international commodity prices. MMCZ said overally, revenue from minerals, except gold and silver, declined to US$1,74 billion last year, from US$2 billion in 2013. Income from steel was US$4,4 million while US$4,6 million was generated from graphite. Coal exports amounted to US$2,9 million while granite raked in US$22,5 million.

Export revenue from the Platinum Group Metals was US$436 million, high carbon ferrochrome (US$242,9 million) copper (US$14,5 million) while nickel raked in US$124,1 million. Minister of Finance Patrick Chinamasa said government was not receiving any revenue from companies mining diamonds in Chiadzwa as the field had run out of alluvial diamonds. Responding to a question in Parliament, Chinamasa said the quality and quantity of diamonds mined at the diamond fields had declined.

“The truth of the matter is that there are no more alluvial diamonds and the companies there, except for only one, did not set aside funds to explore and extract the kimberlitic diamonds that are now found there,” Chinamasa said. Market watchers say it was a tragic paradox that “poor nations” such as Zimbabwe with abundant resources should suffer unimaginably while mining companies granted mining rights in Chiadzwa pillaged riches that could otherwise mitigate poverty and foster economic growth.

Source : Financial Gazette

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