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Zimbabwe Cabinet Moots Nationalization of Marange Alluvial Diamond Field

India has announced it will suspend the purchase of Marange diamonds until Harare resolves its differences with the Kimberley Process

The Zimbabwean Cabinet has agreed that the government should take over all alluvial diamond mines and demand a 51 percent stake in all other mining operations.

Finance Minister Tendai Biti called in July call for nationalization of the Marange diamond fields of Manicaland province, saying the private companies with which Harare had entered into joint ventures to exploit the resource were not sharing the wealth.

But one Cabinet minister speaking on condition of anonymity told VOA that there will be no free lunches, as he put it. Indigenous players who want to acquire mining stakes will be expected to pay fair value, he said, and no shares will be ceded.

However, a ZANU-PF proposal to impose a levy on companies to fund the indigenous acquisition of equity shares in is creating divisions in the unity government.

Indigenization Minister Saviour Kasukuwere told VOA Studio 7 reporter Blessing Zulu that the Cabinet agreed national resources should benefit the people.

Indigenization Ministry spokesman Psychology Mazivisa said the Cabinet proposals will be implemented soon as a consensus within the government has been reached.

Economist Walter Nsununguli Mbongolwane told Brenda Moyo the government proposal to to take over the Marange field is intended to ward off criticism of indigenization.

Meanwhile, India has announced it will suspend the purchase of Marange diamonds until Harare resolves its differences with the Kimberley Process Certification Scheme.

The mining Internet site Mineweb reports that the indian Commerce Ministry has ordered the country’s gem traders to halt all business in diamonds from Marange until consensus has been reached within the Kimberly Process as to certification of such stones.

This came as a major setback to an Indian diamond consortium, Surat Rough Diamond Sourcing India Limited, which had proposed to buy US$1.2 billion worth of Marange diamonds a year from Harare.

Major players in the huge Indian diamond industry said the government decision could create a shortage resulting in large-scale smuggling of Zimbabwean rough stones.

Reports said India's decision was spurred by pressure from the United States, which is urging industry members to boycott Marange stones to deprive President Robert Mugabe's ZANU-PF of a key source of revenues.

Attorney Julius Mutyambizi-Dewa said Harare must put in place a clear diamond policy and deal decisively with the issues raised by the Kimberly Process, including human rights violations in the diamond-bearing zone and demilitarization of Marange.