The Financial Gazette

Clemence Manyukwe, Political Editor

IT was clear to all and sundry last Friday that Finance Minister, Tendai Biti, was speaking the language of ZANU-PF during his address to the Senate. While defending the country’s Mid-Term Fiscal Policy review statement and evidently frustrated by months of futile banging on donors’ doors, Biti proposed the nationalisation of diamond mining in particular and the need for government to extract more revenue from the mining sector.
President Robert Mugabe had set the tone for Biti, the secretary-general of the larger faction of the Movement for Democratic Change (MDC-T) three days earlier.
In his address on the occasion to open the third session of the seventh Parliament, the President said emphasis in government has shifted from reliance on aid as a critical factor for economic development.
To analysts, this was not a bolt from the blue coming from the ZANU-PF leader, but a sign of changing times with regards to Biti.
The Finance Minister’s statement comes against the backdrop of failure to raise adequate budgetary support from donors, who have so far provided US$207 million out of the required US$810 million.
“Zimbabwe is endowed with serious mining resou-rces but these mining resources are just benefiting outsiders, the multi-nationals that own these mines. If you take the Zimbabwe Platinum Mine, the biggest mine in Zimbabwe, it is owned by Impala, a South African company. If you talk about our gold sector, again the major dominant players are South Africans. We are not benefiting. The mining model we have in this country where people just depend on tax and royalties is not good enough,” Biti told senators.
“Last year we only got US$44 million from the mining industry yet they exported over a US$1 billion. This year if you look at the graph that I have handed out , they have exported about US$650 million but we have only gotten US$15 million. This is why for Chiadzwa we have said only the State should mine diamonds at Chiadzwa. If we continue to give concessions to makoronyera (dealers), it is a disaster for this country, let us have the State to mine diamonds.”
Economic analyst, Eric Bloch, this week said government was clearly extending its interest on mining, but described Biti’s proposal to nationalise diamond mining as disastrous.
“Diamond mining must be done by the private sector with proper controls in line with KP (Kimberley Process) requirements. Governments are not capable of running businesses. Look at parastatals the world over, including Zimbabwe. The private sector is the one which has the skills,” said Bloch.
He added that although gemstones can make a difference in the life of a nation, there are also fears of misuse of diamond funds if governments are involved in diamond mining.
Bloch said at the moment local mines may appear to be making a windfall, but they are still developing their mines after a decade of neglect as a result of the country’s tenuous economic and political process.
The other pitfall is that the country’s diamond industry still faces uncertainties as a result of the Kimberley Process (KP), a certification scheme established in 2003 which brings together governments, industry and civil society with the aim of eradicating the trade in conflict diamonds.
Unlike government claims of the existence of a wholesale nod on the export of diamonds from last week’s World Dia-mond Council meeting in Russia, this is not so — according to a civil society organisation Partnership Africa Canada(PAC), which is also a member of the KP.
“Under the terms of the agreement, Zimbabwe will be allowed to export a limited number of diamonds produced since May  28 in two sites in Marange.
“At the same time a Kimberley Process review mission will visit the country to assess conditions in the region and compliance with the scheme’s standards,” according to PAC.
“Zimbabwe will be able to export one more batch of diamonds at the start of September, but any exports thereafter will be contingent on mea-surable improvements in the diamond fields.”
The organisation added that the agreement is far from perfect, and it will take considerable efforts by all parties to the KP, especially Zimbabwe, to make it work.
“The crisis in Zimbabwe’s diamond sector should act as a wake-up call to governments and the diamond industry: This issue is too important, both to consumers and to diamond mining communities, to keep lurching from crisis to crisis,” said the diamond watchdog.
Harare lawyer, Jonathan Samkange, who represents, Africa Consolidated Reso-urces in its dispute with the government over Marange claims on Monday said, government must be involved in diamond mining only in a partnership not single-handedly doing the mining.
“These are national issues and the government must not be a bystander. They should come into a partnership and this is what we have been proposing over the years,” said Samkange.
Speaking last week during the official commissioning of a multi-purpose drilling rig in Harare brought into the country by Goldsearch Holdings, a wholly Zimb-abwean-owned company, Bishop Trevor Manhanga of the Evangelical fellowship of Zimbabwe, said empowerment is critical, but that does not mean seizing properties.
“A nation is built on hard work and integrity. Empowerment is about seizing opportunities and not properties and government should create the enabling environment,” the clergyman said.

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