Recently, Finance Minister Tendai Biti stated that a policy has been developed by his Ministry to require the country’s diamond miners to hand over at least half of their revenue.
The Minister added that a statutory instrument had been formulated, although it cannot be made into law until it gets the go ahead from President Robert Mugabe.
“If it goes ahead, it will be catastrophic for the diamond mining sector. A significant portion of its revenue is required to fund operational expenditure, development and equipping the mines,” economist Eric Bloch warned. “Instead of growth in diamond mining operations, which would benefit the Zimbabwean economy, the sector will decline significantly and increase illegal diamond mining and smuggling.”
Zimbabwe has vast diamond resources, most of which have been discovered in the east since 2006.
While it is hoped these will eventually revive the country’s economy, there has been concern some of the revenue from diamonds has not been going to the state’s coffers but those of Zanu (PF), whose senior members have a stranglehold on the industry.