By Alois Vinga
A REGIONAL expert on mineral resources has warned Zimbabwean authorities against extending contracts to “ghostly” companies within the lucrative diamond mining industry.
Speaking to NewZimbabwe.com Business Wednesday Southern Africa Resources Watch executive director, Claude Kabemba said this promoted opaque dealings which further increased the risk of tax evasions and illicit financial flows, impoverishing the nation in the long term.
Kabemba said past errors must be avoided as Zimbabwe heads for reopening diamond mines.
He discouraged the participation of a grouping of small mining companies in the extraction of the precious mineral saying this was a barrier to transparency and created room for huge financial losses in the country.
“We have it on record that the companies which were contracted to carry out mining during the 2008 era were not transparent and had a deliberate approach to obscure operations information.
“More worryingly the first diamond was exhausted without meaningful infrastructure development taking place,” he said.
President Emmerson Mnangagwa’s government has extended fresh diamond mining rights to Anjin Investments in Chiadzwa, Manicaland, some four years after the company was evicted from the mineral-rich area alongside other miners on allegations of under-declaring proceeds.
Said Kabemba, “There is no need to repeat the failures experienced by the country in the first diamond rush where the same small companies exported millions worth of the precious gems without any visible developments in the country.
“This can be achieved by strengthening internal legislation and capacity to track mineral trades.”
During the height of alluvial rough diamond mining in Marange, Zimbabwean authorities boasted the country was producing over 25 percent of the world diamond production.
Late former President Robert Mugabe revealed the country could have lost over US$15 billion through some shady deals by cartels linked to the lucrative industry.
Kabemba called for the capacitation of entities like the Zimbabwe Mining Development Company (ZMDC) and the Zimbabwe Revenue Authority (ZIMRA) for them to be able to detect illicit financial flows whenever they take place.
He said the shadowy mining firms are increasingly gaining popularity across the continent as ruling party elites took them as avenues to secure election funding as well as being conduits to move out huge chunks of money to safe tax havens.
