HomeBusinessZimbabwean Govt To Nationalise Country's Diamond Mines

Zimbabwean Govt To Nationalise Country’s Diamond Mines


Zimbabwean Govt To Nationalise Country's Diamond Mines
Zimbabwe must move from simply mining to cutting and polishing its own gems.

AFRICANGLOBE – Zimbabwean President Robert Mugabe has announced that the government will take over all the country’s diamond mines to stop foreign firms syphoning off gems without declaring them.

“We have not received much (money) from the diamond industry at all,” Mugabe said in a two-hour interview screened late Thursday by state broadcaster Zimbabwe Broadcasting Corporation.

“Our people… have not been able to see or hear what was going on and lots of swindling, smuggling have taken place and the companies that have been mining virtually robbed us of our wealth.

“We have decided that this area should be a monopoly area and only the state should be able to do mining.”

Mines Minister Walter Chidhakwa last month announced the government had seized diamond mines in the eastern Chiadzwa fields near the border with Mozambique after their licences expired.

Mugabe said only $2-billion had trickled into government coffers out of $15-billion generated by the industry, though he gave no timeframe for the figures.

Critics predicted that nationalisation would decrease foreign investment and may fail to boost government revenue.

“The move is bringing uncertainty to investors. They are unnerved,” Prosper Chitambara, an economist at the Labour and Economic Development Research Institute of Zimbabwe, told foreign reporters.

“You can’t just decide ‘We are taking over’. It makes Zimbabwe less attractive as an investment destination.”

The country is among the worlds 10 largest producers of diamonds by volume. Prices are at a six-year low after falling 18 percent last year.

Zimbabwe, which earns most of its foreign exchange through mining, saw production fall to 420,000 carats in the first five months of 2015 from 660,000 carats a year earlier, according to Western media sources.

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