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Tuesday, January 4, 2011

Report: Kimberley Process Approves Marange Diamond Sales

Photo by Tsvangirayi Mukwazhi, AP
The Kimberley Process, the organization charged with preventing trade in illicit diamonds, has reportedly approved supervised sales of diamonds from the highly controversial Marange diamond fields in Zimbabwe.

Gift Chimanikire,
Zimbabwe Mines and Mining development deputy minister, said that the KP recently wrote to the Zimbabwe government, confirming that it could market its precious stones, according to a report Tuesday in ZimOnline, a Zimbabwean independent news agency.

The issue of Zimbabwe selling diamonds from the Marange fields has divided the KP along political lines with Western countries led by the United States, Germany and Australia as well as nongovernmental organizations calling for banning of the gems, citing reports of continuing human rights abuses and rampant smuggling at the controversial diamond field. They are at odds with other African countries and other countries, including Russia, who are opposed to banning the diamonds, ZimOnline reports. The Zimbabwe government claims that the Western countries and NGOs are driven more their dislike of President Robert Mugabe than by concern for human rights.

The KP is made up of governments, diamond industry representatives and NGOs to stem the flow of “conflict” or “blood” diamonds—rough diamonds used by rebel movements to finance wars against legitimate governments. The Kimberley Process Certification Scheme imposes extensive requirements on its members to enable them to certify shipments of rough diamonds as “conflict-free.” The KP has 49 members, representing 75 countries, with the European Community and its member states counting as an individual participant.

Beginning in 2008, the Zimbabwe army took over the Marange fields, considered by many to be one of the largest diamond deposits in the world, forcing out tens of thousands of small-scale miners. These miners were massacred by soldiers and villagers have been beaten, raped and forced to work in the mines. The human rights abuses led to Zimbabwe to being suspended from the KP.

The KP voted to temporarily reinstate Zimbabwe in July, allowing two supervised exports of rough diamond from Marange held in August and September. However, the KP in November, based on continued reports of human rights abuses and smuggling, failed to reach an agreement on whether to allow Zimbabwe to sell Marange diamonds through the organization’s certification scheme. In response, the Zimbabwean government threatened to dump their diamonds on the open market, which would cause worldwide diamond prices to fall. 

Among the more recent accusations, is a report from Human Rights Watch that accuses Mugabe's long-ruling ZANU-PF party of tapping proceeds from the illicit sale of diamonds from the Marange field to fund its campaign for anticipated 2011 elections, according to Voice of America. The report includes charges of killings by the military of freelance diamond panners in the Marange field, while diamond smuggling through Mozambique was rampant.

In a related development, VOA reports that Israeli authorities have arrested two men on charges they tried to smuggle Marange diamonds into the country.

Law enforcement agencies arrested David Vardi and Gilad Halachmi at the Tel Aviv airport on December 23.The two are accused of trying to smuggle diamonds worth more than $200,000 into the country. Vardi, a diamond trader registered under the Israeli Diamond Exchange, has been expelled from that organization.

In a more recent development, six alleged diamond fraudsters are expected to be indicted at the High Court of Zimbabwe for trial on Tuesday amid fears they may be remanded in custody, according to the Zimbabwean publication, NewsDay.

The six include Core Mining and Mineral Resources director Lovemore Kurotwi, suspended ZMDC chief executive officer Dominic Mubaiwa, suspended legal advisor and company secretary John Tichaona Muhonde, former ZMDC acting chairperson Gloria Mawarire, former ZMDC director Ashton Sibusiso Ndlovu and former ZMDC board member of the technical committee, Mark Tsomondo.

The six accused persons were arrested on allegations of conniving to defraud the Zimbabwe Mining Development Corporation and government of more than $10 million worth of diamonds.

Search the Jewelry News Network for a collection of stories on this issue.

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