Instead of saving Zimbabwe, the Blood Diamonds only enriched its ruling class
By Sam Gregory
MUTARE, ZIMBABWE — Grace Mugabe, wife of President Robert Mugabe, is one of the major beneficiaries of Zimbabwe’s controversial Marange diamonds. Reports have confirmed that she holds a major stake in Mbada Diamonds — one of the companies mining in Manicaland province. Before the ensuing violence and corruption many dared to believe these diamonds would be a source of recovery for this downtrodden nation but, as this reporter found in Zimbabwe’s eastern borderlands, the diamonds many hoped would save their country are destroying it.
The rush and the reality
In 2006, when Zimbabwe was on its hands and knees, a shining opportunity presented itself — diamonds. Such a rich deposit has seldom been seen throughout the history of mineral exploration and it came at just the right time for a nation in peril. Starvation was rife in rural areas, health care was extremely limited and hyper inflation was beginning to take its toll.
The diamonds were seen as a major opportunity and accordingly thousands moved to the Marange diamond fields — near Zimbabwe’s eastern border with Mozambique — in the hope of making their fortunes in the rush. Some were not so optimistic however. As estimates of the value of diamonds in the mines grew so did the potential for conflict. Great wealth was up for grabs in a politically tense environment.
Mutare, a town on the border with Mozambique, is surrounded by steep mountains, giving it an imposing backdrop. Below these mountains to the East are the endless plains of flat, dry, African savannah. Despite the natural beauty of Mutare, it’s becomes quickly obvious to the outsider that something’s wrong.
Just beyond the mountains are the mines of Marange and Chiadzwa, a source of fear for the Mutare’s residents. Many of them have witnessed or been directly affected by the atrocities committed at the mines, only 40 miles to the west. The locals have a name for these mines, one which exposes their fears — they call them the “Pits of Fury” — “Mugodhi Hasha” in the native Shona.
Stories of violence or death at the mines are common here in Mutare and those who are willing to discuss diamonds do so with a fear of who may be listening. During my visit to the town I spoke to many who have witnessed the human rights abuses which have been, and still are, committed at the nearby mines.
A taxi driver who agreed to drive me as close to the mines as he could spoke of the initial signs of problems at the mines, “The situation escalated quickly”, he says. “One day everything was fine and the next the army came”.
During the early stages of the diamond rush in late 2006 more than 20,000 Zimbabweans flocked to Manicaland province from all corners of the country. Educated professionals who couldn’t find jobs in Bulawayo or Harare, the capital, were moving to Manicaland to make their fortunes — or just enough to survive — in the diamond fields. At first, he says, there were only the miners and a small number of officials. But as the army moved in, the mood changed. Miners were beaten and sometimes killed.
The soldiers formed syndicates to smuggle diamonds to the Mozambique border near Mutare and the South African border at Beitbridge. Those who were not in the syndicates or who angered the soldiers were often killed. From his home near a town called Bazeley Bridge, the taxi driver says he sometimes heard machine gun fire in the distance.
The mines themselves are contained by barbed wire fences and the road in has a series of road blocks. At one point in the road the driver pulled to the side. The first roadblock was just ahead, and he didn’t want to drive close. “If soldiers see us turn around in front of the roadblock, they may follow. The fact that you’re white will make the soldiers suspicious of us,” he said.
Trymore Kambudzi (his name has been changed to protect his safety) lives on the streets of Mutare. He’s 16 years old and he sells Zimbabwean flags, among other souvenir items, to the few tourists who pass through the border town. On a street corner near the centre of town, he tells me of how, in 2007, he and his family were forcibly evicted from their home in Marange as part of the militarization of the nearby mines. For this he counts himself lucky — many were not so fortunate.
“A lot of friends and people I knew were forced to work in the mines without pay,” Kambudzi says.
These latter-day slaves have been subjected to violence that has attracted the notice of the world’s human rights community, and Kambudzi has yet to see many of the people he left behind.
“There are stories about people I knew,” says Kambudzi. “I hear rumors that something bad has happened to my friends, but how do I know? My family was just lucky we got moved away.” The government and the mining companies promised to cover the costs of the home they took from his family, but so far they haven’t seen a cent, nor do they expect to.
In its scramble to gain control of the diamond fields in 2008, the government killed and wounded hundreds of Zimbabweans. The official number of deaths has never been made clear but mass graves have been discovered.
Soldiers used dogs to track the miners who hid in the surrounding bush. Most were killed by small arms fire or beatings, but there were reports of helicopters being used to fire upon miners as they tried to find cover in the pits.
Nongovernmental organizations such as Global Witness and Human Rights Watch have compiled reports of murder, torture and rape at the mines, taking hundreds of victim’s accounts of the violence. They claim the abuses are still occurring at the mines and accuse the Zimbabwean government of covering up the violence.
Farai Maguwu, a human rights campaigner based in Mutare, has been a determined advocate of the miners in recent years. His high profile arrest in June for allegedly providing false information to the Kimberley Process (a civic society concerned with regulating the mining and selling of diamonds) made headlines around the world.
Maguwu documented numerous accounts of violence and diamond smuggling but when he presented it to the Kimberley Process he was arrested and imprisoned. In interviews before his arrest he made clear the extent of the human rights violations — “Women have been gang raped by soldiers and police and these substantiated allegations are very unacceptable and show that Zimbabwe is not complying with the minimum standards of the Kimberley Process”.
The people I spoke with in Mutare and Manicaland province confirmed that forced labor and violence are still occurring on a large scale as well as smuggling of diamonds and unmonitored mining.
‘When the president is greedy the people are poor’
In Transparency International’s 2009 Corruption Perceptions Index, Zimbabwe ranked near the bottom: 146th out of 180 nations. Although human rights abuses, slavery and murder are a terrible price to pay, the more pressing issue for Zimbabweans at this time is corruption. For a country with so little, Zimbabwe stands to lose a lot.
The diamonds themselves are mainly low quality, suitable for industrial sale only. Five to 10 percent are gem quality; these fetch a far higher price. But it is the sheer quantity of diamonds in the Marange area that has caused such a stir in the international mining industry. Most estimates value the diamonds at between US$1.5 and US$2 billion per year for the next 10 years at least. Diamonds stockpiled by the government which are currently being sold have an estimated value of US$1.7 billion.
With this sort of money up for grabs, corruption was inevitable and it began soon after the discovery. African Consolidated Resources, a London listed mining company, owned the land where the majority of the diamonds lie and was in the process of setting up to mine when the government invaded and occupied the property.
Soon after it had appropriated the land, the Mugabe government set up two companies to mine and sell the diamonds. These companies, joint ventures between South African investors and the Zimbabwean government, are named Mbada Diamonds and Canadile Miners. Since their conception, both companies have been cloaked in secrecy and close links with Zanu PF have led many to question their legitimacy.
The recent revelation that Grace Mugabe, Robert Mugabe’s wife, is a major shareholder in Mbada diamonds has come as no surprise to many observers. The Mugabe’s have long been suspected of having close links to the diamond industry and this suspicion was confirmed last year through an investigation into the couple’s activities in Hong Kong. On a shopping spree there in January 2009 Grace was reported to have been making inquiries for a business venture in the diamond industry. She went as far as locating a facility to cut and polish diamonds in Qingdao, Eastern China, fuelling speculation that the Mugabe’s were involved with the illegal export of Zimbabwe’s diamonds. This has also led to a wide spread belief that Chinese authorities are heavily involved in the shady business of mining Marange’s diamonds.
The board of directors at both Mbada and Canadile consist of Zanu PF supporters, family members of politicians and shady figures of the diamond trading industry. Zanu PF Minister of Mines, Obert Mpofu, is also closely linked to the businesses he selected to mine the diamonds. He obviously benefits from a source of income over and above his salary as a minister, earlier this year he purchased a considerable amount of property in Bulawayo, including a race course and a casino. He is widely believed to be an anonymous director of Canadile.
In a June cabinet meeting Tendai Biti, Minister of Finance and Movement for Democratic Change MP, brought attention to the corruption perpetrated by members of Zanu PF. Of an estimated US$30 million worth of diamond sales, approved by the government and it’s agencies before the Kimberley Process lifted the ban, only US$800,000 has been deposited into government coffers, the rest has disappeared into the pockets of anonymous individuals. Investigations conducted in Harare by the Zimbabwe Independent, a prominent national newspaper, have revealed that profits from these sales were deposited into private Harare bank accounts in ABC and CBZ banks via money transfers from Standard Chartered Bank in New York. Biti’s comments led to a heated argument between himself and Obert Mpofu in which Biti walked out in protest at what observers have called a systematic and determined stripping of Zimbabwe’s resources by members of the government and their associates.
An elderly man named Munya Radzi, from a village near Mutare, is appalled by the violence which his community has had to face since 2008 but what’s worse, he says, is the politicians becoming rich while the people remain poor. Speaking about the accusations of corruption being directed at the government his sense of betrayal is obvious — “When the president is greedy the people are poor,” he says.
Enter the Kimberley Process
In July 2010, the Kimberley Process (KP), a civic society concerned with the ethical mining and selling of diamonds, met in St. Petersburg, Russia. An earlier meeting in Tel Aviv, Israel on June 21-24, 2010, had resulted in a previously issued sales ban on all Zimbabwean diamonds being upheld on the grounds of human rights abuses and a lack of transparency.
Presented with overwhelming evidence of abuse and corruption, the KP was faced with a dilemma. On one hand they had pages and pages of affidavits categorizing abuses which occurred at the mines but on the other they had Robert Mugabe threatening to sell the diamonds with or without KP certification. If the ban was upheld, Mugabe would sell the stones to China or Iran for a lower price, Zimbabwe would be expelled from the Kimberley Process and there would be fewer controls on mining and sales.
Eventually in St Petersburg on the 14th and 15th of July the KP chose to lift the ban. By doing so, it retained access to the mines and a measure of control over legitimate sales.
These sales started in early August with 900,000 carats of diamonds valued at US$72 million being sold. The sales have been widely celebrated in Zimbabwe and have the blessing of the KP, but many are not convinced that the profits of these sales will benefit Zimbabwe’s public. The companies overseeing the sale of the diamonds are, after all, Mbada Diamonds and Canadile Miners. There’s also the matter of ensuring that human rights abuses don’t continue to occur and creating accountability for those abuses which have already occurred.
The KP plans to evaluate conditions at the mines in a series of visits throughout September, but feeling amongst observers is that the inspectors will not be exposed to the reality of life at the mines.
Overall the Zimbabwe affair was not a pleasant one for the Kimberley Process. Many questioned its ability to exert power on nations which do not meet the standards it requires. The decision to uplift the ban and allow sales of the diamonds was justified as being the best course for Zimbabweans in general. However the fact that a single threat from Robert Mugabe — to sell the diamonds without the blessing of the Kimberley Process — was enough to force a decision leaves the KP open to accusations of being toothless.
The South African Kimberley Process inspector, Abbey Chickane also came under fire for his part in the process of uplifting the ban. The KP’s first choice of inspector was rejected by Mugabe himself, raising questions of why Chickane was seen as suitable. He is also believed to have been responsible for the arrest of Farai Maguwu, the human rights activist, after Maguwu presented evidence of ongoing human rights abuse at the mines.
The Marange diamonds have certainly cost the Kimberley Process some credibility but the fact is that most Zimbabweans agree with the decision to lift the sales ban. Although they’ve resigned themselves to a certain amount of government corruption, Zimbabwean’s get more from legal sales than from illegal sales.
What Could Have Been
Many think the diamonds in Zimbabwe’s soil could be the source of its financial recovery but this belief has faded somewhat. Certainly, if administered correctly and without excessive corruption, the mines could boost the fortunes of Zimbabwe’s failing economy and ease the poverty which has affected so many. But the fact is, although only a small portion of the diamonds have been mined and sold, the process of corruption appears to be irreversible at this point.
In terms of domestic politics, the diamond issue has done serious damage to relations within the National Unity government. Members of the MDC (Movement for Democratic Change) particularly Minister of Finance Tendai Biti and Prime Minister Morgan Tsvangarai, have expressed revulsion at the fact that, while people are starving, Zanu PF politicians and their associates are becoming rich from stolen national resources. They’ve indicated that profits from the diamonds may be used to fuel violence during the elections scheduled for next year and recent reports of a ‘diamonds for arms’ deal between the Chinese government and Zanu PF are an ominous sign before the election.
To most it would appear that Zimbabwe’s golden opportunity has been comprehensively squandered, but it’s a testament to the optimistic and resilient nature of Zimbabweans that some don’t see it like that. Discussing Zimbabwe’s future with Mutare’s residents reflects this positive outlook. Most believe that things will change for the better. In his time, Munya Radzi has seen Zimbabwe go from glory to despair but when asked what will happen to his country he says with conviction “It will get better”. His optimism is commendable but at this stage it appears that, far from benefitting Zimbabweans, the diamonds are tearing the country apart.
The Chiadzwa Gang
Mbada Diamonds and Canadile Miners were formed by the Zimbabwean government soon after the diamond fields were claimed. It was reported at the time that the intention was to mine the diamonds for the benefit of all Zimbabweans. Now it appears the companies were formed solely to benefit Zanu PF politicians and their associates.
The list of board members of both mining companies reads like a who’s who of corruption and crime in both Zimbabwe and the international diamond industry.
Canadile Miners Board of Directors
- Chairman Lovemore Kurotwi — a long time Zanu PF member, played a major role in alleged war crimes against Zimbabweans, including the Matabeleland massacres.
- Adrian Taylor — a former mercenary who served in Sierra Leone during that country’s struggle to contain the flow of blood diamonds.
- Yehuda Licht — an Israeli diamond dealer, allegedly spent time in an Angolan prison for diamond smuggling offences.
- Ashok Pandeya — on Thailand’s most wanted list for smuggling diamonds worth more than $100 million.
- Obert Mpofu — the Zanu PF Minister of Mines, is said to have close links to the operations of Canadile and is suspected of being an anonymous board member.
Mbada Diamonds Board of Directors
- Chairman Robert Mhlanga — Robert Mugabe’s former personal helicopter pilot.
- Sithengisiso Mpofu — Obert Mpofu’s sister in law.
- Dingiswayo Ndlovu — Obert Mpofu’s personal assistant.
Sam Gregory is a freelance journalist based in London.