Zimbabwe's diamonds: But where is the money?

Zimbabwe has cut down diamond expected revenue from the sale of diamonds by 75%, a further blow to the country's faltering economy.
 
The southern African country had hoped to earn at least $600 million from the sale of diamonds, but so far the mineral has not contributed much, with the Zimbabwe Mining Development Corporation saying it now only expected $150 million.
Zimbabwe blames the poor revenue output to sanctions, particularly from the United States, which it accuses of dissuading other countries from buying its minerals.
"From January to September this year, we have remitted about $113 million to treasury from royalties and dividends, a figure that is way below the projected $600 million," Goodwills Masimirembwa of the Zimbabwe Mining Development Corporation said.
"We have managed to realise $542,288,512 from diamond sales. It is clear that the gross sales have failed to reach the projected $600 million that the sector was supposed to contribute to the treasury."
In July, Finance Minister, Tendai Biti bemoaned the poor revenue from diamond sales, saying by mid-year only $46 million had been realized, forcing him to slash the 2012 budget spending target from $4 billion to $3.4 billion.
He said earnings from key minerals such as gold and diamonds were not making it into state coffers.
However, Masimirem¬bwa says from 2010 up to last September, a total of $1.2 billion was earned from diamond sales with $425,850,455 being remitted to the Finance Ministry.
Zimbabwe has more than five diamond mining companies, two of which are under sanction from the United States, with each having a capacity to produce 500 000 carats per month.
Lack of transparency and accountability from diamond revenues has also cast a dark shadow on the industry.
The latest forecasts come as Zimbabwe is planning on hosting a diamond conference, with more than 5 000 international guests, experts, policy makers, jewelry manufacturers and traders expected.


The diamond conference will be held on 12 and 13 November.


Authorities say the conference is meant to clear misconceptions around the country's diamond industry, as well as promote the sector as a safe investment destination.


Zimbabwe's diamonds have divided world opinion, with African and Asian countries backing the southern African country's bid to sell the minerals while the West and rights groups are opposed to the sale, charging that they are blood diamonds.