US sanctions hit Zimbabwe’s state-owned diamond miner, exports

Zimbabwe’s state-owned diamond miner says a US ban on rough diamonds from one of its largest gem fields is hurting the country’s export earnings.

The US Customs and border protection agency in October issued a withhold release order for diamonds from the Marange area citing suspicions that they were mined using forced labour.

The Zimbabwe Consolidated Diamond Company has denied allegations that it uses forced labour at its mines.

ZCDC said the ban has seen international buyers offering low prices for the country’s diamonds.

“These are lies that are being driven by a common purpose or agenda,” ZCDC chairperson Killian Ukama said.

Although there has been no formal engagement between Harare and Washington concerning the sanctions, Zimbabwe has contracted lobbyists from the US and the UK to push for the removal of the embargo. However, Washington has lately toughened its stance on Zimbabwe over increasing repression of dissent as was seen recently with the daylight attack on an opposition gathering by security forces.

There have also been unexplained kidnappings and detentions of opposition activists and trade unionists in the wake of strikes by workers demanding that their salaries be pegged to dollars.

Inflation in the country was officially at 390 per cent as of October but independent analysts place it at about 600 per cent.

ZCDC recently cut its production forecast for this year by 24 per cent to 3.1 million carats, but exports a rebound to 6.12 million carats in 2020.  The country’s overall diamond output is forecast at 4.1 million carats this year, from 2.8 million carats in 2018. At the peak of mining operations in Marange in 2012, the country was producing 12 carats a year.

Meanwhile, a civil society leader whose organisation monitors mining operations in Marange blamed illegal mining activities for the ban, saying the claims of forced labour were not true.

“We have been working in Marange since 2012 and we have not come across cases of forced labour, be it full time employees, casual contract workers or artisanal miners,” said Farai Maguwu from the Centre for Natural Resource Governance. “We have raised several issues of concern regarding the treatment of community members by both the state and mining companies but forced labour is definitely not one of the issues that have arisen.”

Villagers in the area, however, claim soldiers guarding the diamond fields at times force them to work at illegal mining operations in Marange.

Zimbabwe first discovered alluvial diamonds in the Marange area around 2006, sparking a scramble by illegal miners.

The government deployed the army, which was accused of engaging in forced labour of children and torturing villagers.

At least 200 people were reportedly killed during a clampdown by the army in 2008.