The World Diamond Council, which regulates the global diamond trade, named Zimbabwe and Venezuela as the only two countries that have failed to prove that their diamonds are conflict free.
The chairman of the WDC, Eli Izhakoff, said while trade of conflict diamonds, as measured by the Kimberley Process, a body that ensures diamonds are conflict free, is on the decline, Zimbabwe and Venezuela, need to do more to comply with the Kimberley Process standards.
"We have problems in Zimbabwe, where the government is cooperating in trying to put their house in order, and, hopefully, we can resolve the situation," Izhakoff said.
Izhakoff told a meeting in Jerusalem that the two countries have asked for his help to become compliant.
The WDC is expected to send a fact-finding mission to Harare, Friday, to assess the situation.
But mines minister Amos Midzi told reporter Blessing Zulu of VOA's Studio 7 for Zimbabwe, that Harare had complied, and was surprised by the WDC's allegations.
In related developments, the magistrate court on Wednesday granted bail to Adele Farqhar and her husband Michael, the two directors of Bubye Mine, embroiled in an ownership wrangle with a business group led by retired army general Solomon Mujuru, husband of Vice President Joyce Mujuru.
The two, who were arrested Monday, were ordered by the court to pay Z$5 million bail each; surrender their passports and the title deeds to their Bulawayo house valued at more than Z$800-million. The two are also to report twice weekly at the nearest police station in Bulawayo.
The Farqhars are also not allowed to leave their home until June 4th.
But some ministry officials speaking on condition of anonymity, told VOA that it is not a coincidence that the Farqhars were arrested at about the time WDC is set to visit Harare.
They said their tough bail conditions made it difficult for the Farqhars, who had raised global awareness of Harare's lack of compliance with the Kimberley Process, to meet with the WDC officials.
The Farqhars claimed that retired general Mujuru, and his consortium, which has physical control of the mine, had been exporting diamonds in violation of court orders and without proper certification.
But the state, on the other hand, accused the two of externalizing money and also selling off company equipment at the Beitbridge diamond mine, despite the fact that the company had been liquidated.
Bubye mine lawyer, Terrence Hussein, told reporter Blessing Zulu that his clients had been held under inhospitable conditions while in detention, and that he had been threatened by River Ranch legal advisor, retired judge Leslie Smith, who, he said, wrote to the Law Society of Zimbabwe to have him de-registered.
Smith denied the accusations, and told reporter Blessing Zulu that he only complained to the Law Society, because Hussein was distorting facts.