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Zimbabwe is reportedly losing billions of dollars in potential revenue annually by exporting rough diamonds. Chairman of the Zimbabwe Diamond Technology Centre (ZDTC) Mr Lovemore Kurotwi told members of the Parliamentary Portfolio Committee on Mines and Energy during a tour of the centre this week that by cutting and polishing its diamonds before export, Zimbabwe could earn US$14 billion every year.
More startling news: “If we sell finished products in jewellery form,” said Kurotwi, “we will earn US$21 billion annually.” These are staggering figures by any standards. The only limitation is that it wasn’t clear what quantities were involved in the raw state.
What is, however, important is the urgent need to beneficiate our minerals. If the export of polished diamonds alone can generate over US$14 billion for the country every year, we can’t start to imagine what we should be earning if all our minerals were processed in the country. We haven’t even factored in the benefits of employment creation in the whole value chain from sorting, cleaning, cutting and polishing and jewellery to trading and retail.
President Mugabe has long called for the beneficiation of our minerals, be it gold or platinum or diamonds locally. Foreign companies always complain about costs, from levies to royalties. Most of them are fully aware that we don’t know the full value of our minerals. We are good at buying the jewellery in the shops when we can no longer recognise it from Marange.
On the other hand, the foreign companies for their part are reluctant to invest in processing technologies in this country as that will cost jobs back home. They would rather do value addition in their own country and keep jobs. In Zimbabwe, they are reluctant even to donate a little to Community Share Ownership Trusts or Employee Share Ownership Trusts.
It is known that Antwerp, the international hub of the diamond trade, employees more than 34 000 in the various stages of trade. The volatile situation in the South African mining sector, one of the major suppliers, threatens to destabilise trade in diamonds, hence the decision by the EU to allow Zimbabwe to sell its so-called blood diamonds from Chiadzwa.
In a trial tender in December last year, Zimbabwe auctioned 279 723 carats in Antwerp for just US$10,5 million. There is a lot of excitement about prospects for the auction that began yesterday are bigger. However, the value is not likely to be anywhere near the potential US$14 billion, let alone US$21 billion.
These figures alone make a compelling case for beneficiation. We have no business digging canyons all over the country just to donate our mineral wealth to other nations. In fact, it turns out that the biggest beneficiaries of our various minerals are nations which don’t produce any but have the technology to process ours and sell the jewellery as their own.
We are currently struggling to finance a measly budget of US$4,6 billion as if Zimbabwe were a poor country simply because we are not willing to maximise the benefits from our God-given resources. It’s indeed true that a fool and his money are sooner parted. We have no problem parting with our resources for a pittance just to meet short-term gratification. We prefer to go begging and accumulating debts instead of investing in technology to get more value.
The touring contingent in Mt Hampden included Diamond Beneficiation Association of Zimbabwe chairman, Mr Richard Mvududu and Jewellery Council of Zimbabwe chair Mr Fidelis Dana. They agreed with the MPs that beneficiation was the way to go in support of the Government’s economic recovery and growth blueprint, the Zimbabwe Agenda for Sustainable Socio-Economic Transformation (Zim-Asset).
The MPs promised to push for beneficiation and value-addition to create jobs. That’s well and fine.
The tragedy of our nation comrades is not lack of good plans or lack of policy or lack of promises. The real tragedy is that when all has been said, nothing gets done. Until then, we shall forever remain a poor nation but rich country.
Online Reporter