US bans Marange diamonds


The United States yesterday effectively banned diamonds from Marange by adding two mining companies there, Marange Resources and Mbada Diamonds, onto its sanctions list.

Marange Resources is a subsidiary of the Zimbabwe Mining Development Corporation which was already on the sanctions list while Mbada is a private company which is in a joint venture with the ZMDC.

The United States imposed sanctions on Zimbabwe under its Zimbabwe Democracy and Economic Recovery Act of 2001 which sought regime change in Zimbabwe.

Although the US argues that the sanctions are targeted at individuals and companies on its sanctions list, the sanctions are in effect targeted at the country as a whole because the act forbids international financial institutions like the World Bank, the International Monetary Fund and the African Development Bank from lending money to Zimbabwe unless this is approved by the US government.

The ban on Marange diamonds was lifted last month by the Kimberley Process Certification Scheme at its meeting in Kinshasa. The United States abstained from the vote.

The United States becomes chair of the KP from next month with South Africa, which has been opposed to the ban, as the vice-chairman. South Africa will automatically become chair in 2013.

Decisions in the KP are by consensus and Zimbabwe, together with its Southern African Development Community colleagues, stopped the US from becoming vice-chair to the Democratic Republic of Congo because of its stance on Zimbabwe diamonds.

Another diamond mining company Chinese-owned Anjin, also has KP approval but was not on yesterday’s US list.

Zimbabwe is already one of the top 10 diamond producers and there have been accusations that the West was barring Zimbabwe diamonds from the open market to protect their own operations.

The African Diamond Producers Association this week said the KP’s operations were suspiciously engineered by a former diamond mining monopoly and was imprudently promoted by the US State Department, which had a dream of not only altering African diamond policy, but also possessed an inherent aspiration to covertly command diamond guidelines worldwide.

“In addition, the KP has historically been ill-advised by global diamond organizations that represent and profit from the retail or back end of the global diamond industry. This is where most of the diamond proceeds are brought to fruition and this is also where African diamond producers suffer from most of their dissatisfaction,” ADPA said.

ADPA which was literally calling for the disbandment of the KP added: “The ADC (African Diamond Council) is fed up with KP’s reckless justification, baffling delays to redefine or re-outline preceding terminology and in recent times, diamond producers have also lost patience for the redundancy we’ve observed in these regimented diamond meetings, seminars and conferences over the 3 years.

“African Diamond Producers refuse to prop up a botched system or scheme that deviously exploits the front end of the diamond industry while coaxing urbanized nations to assign integrity to it. ADC members have finally realized that they have more control to renovate our industry than Kimberley Process does, so any dilemma that we currently possess as an organization will be resolved internally prior to seeking external or global support.”

Right now Zimbabwe can do without the United States as its current production cannot meet demand from India alone.

Though the United States is currently the biggest market for jewellery, it will soon be overtaken by China which is now the world’s second largest economy and could overtake the US within 20 years.


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Charles Rukuni
The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.


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