Wednesday, June 1, 2011

SA group to start accepting Chiadzwa diamonds

A South African diamond group has announced that it is ready to start accepting diamonds from Zimbabwe, despite the ongoing confusion over the country’s legal trade status.

As quoted in Zimbabwe's Financial Gazette, a communiqué from the South African Diamond & Precious Metals Regulator said that it was taking its cue from the government, which has already pledged its support for Zimbabwe’s diamond trade to be officially legitimised. The Regulator said; “On that note, we will accept imports of rough diamonds from Zimbabwe.”

South African officials earlier this year had lobbied on Zimbabwe’s behalf at an international diamond meeting in Dubai, calling for the international trade watchdog, the Kimberley Process (KP), to clear Zim diamonds for sale. South Africa’s Mines Minister, Susan Shabangu, said her Zimbabwean counterparts had complied with international standards and the country was ready to trade its gems in a “normal way.”

Shabangu’s remarks came after a controversial decision by the new KP Chairman, Mathieu Yamba, to give Zimbabwe the green light to start exporting, despite the needed consensus by the rest of the KP over the country’s trade future. This confusion remains and international diamond traders have been warned against buying Zimbabwe diamonds until there is a final decision.

The news from South Africa meanwhile comes amid reports that an African ally of Zimbabwe’s has already been buying the country’s diamonds, including stones from the controversial Chiadzwa diamond fields. Gabriel Shumba from the Zimbabwe Blood Diamond Campaign said on Wednesday that the South African Regulator’s announcement this week raised “huge suspicions” that the group might already have been accepting the stones.

South Africa is already widely believed to be the rumoured ‘Zimbabwe ally’ in the diamond trade. The KP monitor appointed to oversee Zimbabwe’s efforts to fall in line with international standards was a South African citizen, Abbey Chikane. Chikane tried to push through a decision to allow the diamond trade to resume, even going as far as unilaterally certifying some diamonds for legal export, without KP approval.

Chikane is related to Frank Chikane, the former Director-General in then South African President Thabo Mbeki's office. Mbeki has faced severe criticism for repeatedly appearing to back the Robert Mugabe regime, through quiet diplomacy and a widely condemned ‘softly-softly’ mediation approach. The accusation then, is that the Chikane’s have used political influence in the diamond trade, possibly for their own benefit.

Meanwhile top South African banking group Old Mutual, is also a shareholder in one of the joint venture mining firms working at Chiadzwa. Old Mutual has played down its involvement there, insisting that it was not part of the deal.

Shumba said on Wednesday that South Africa must be careful of being complicit in “sweeping human rights abuses under the carpet, if it is going to call for the exports from Zimbabwe to resume.” He explained that “the moment you say ‘lets resume trade’ before the question of human rights abuses is dealt with, then you are encouraging the trade in blood diamonds.”

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