Expropriation payout for diamond claim

Zim pays Russians $5m for expropriated diamond claims

DailyNews Live by John Kachembere and Ndakaziva Majaka    

4 May 2017

HARARE - Zimbabwe has paid $5 million-plus to buy out Russian-led miner DTZ-OZGEO for expropriating its diamond claims in Chimanimani.

This also comes as parliament is cranking up pressure on President Robert Mugabe to re-open the Marange gem fields to independent players before year-end, as a way of increasing production and ease the current cash crisis.

Mines minister Walter Chidakwa not only told journalists on the sidelines of a Kimberley Process Certification Scheme (KPCS) meeting in Australia on Tuesday that the settlement had brightened the Zimbabwe Consolidated Diamond Company (ZCDC)' future, but also that the state-owned miner was poised for better things after many of Chiadzwa's ousted operators had withdrawn their litigations.

The $5,4 million buyout comes after the Harare administration had forced about seven gem mining firms to cease operations early last year, in a move that was expected to improve transparency and accountability of the country's precious stones, but the process hasn't been smooth sailing.

According to Chidakwa, Morris Mpofu's ZCDC not only had better prospects after an $8 million capital injection from the Reserve Bank of Zimbabwe (RBZ) - to boost production beyond its current 200 000 carats monthly - but through the acquisition of machinery from stricken Mbada and whose equipment had been auctioned by creditors.

And the cash boost almost coincided with the ex-Central Bank senior staffer's movement from the apex bank to the struggling paratstatal.

Meanwhile, parliament's mines and energy portfolio committee chairperson Daniel Shumba has said that the government must re-open the country's diamond fields to independent players before December this year.

Shumba also said Chidakwa needed to clarify on mining policies for the diamond industry by June 2017, alleging that policy inconsistence in the sector had cost the country million in potential revenue.

"Mining policies for the diamond industry should be clear and consistent in order to attract investment both foreign and local investors," he said while presenting findings of an inquiry into the operations of state-owned Zimbabwe Consolidated Diamond Company (ZCDC) before the National Assembly.

"The Ministry of Mines needs to come out clearly on the position of government pertaining to foreign direct investment into mining concessions in Marange. Policy should be outlined by June 2017," he added.

The Zanu PF legislator further indicated the need to respect property rights in the mining sector in line with section 72(2) of the constitution.

"The Minister of Mines needs to ensure that property rights of investors in the mining sector are respected in order to build confidence that Zimbabwe is an investment friendly destination. Furthermore, companies that lost their properties as a result of consolidation should be compensated, by December 2017," he said.

Following reports that ZCDC will begin gold exploration in Gache Gache, Shumba said the company needed to stick to its mandate.

"ZCDC should solely focus on diamond production. The Ministry of Mines should ensure that ZCDC focuses only on diamond production and cease all operations of gold mining in Gache Gache, within a month of tabling this report," he said.

Source: http://www.zimbabwesituation.com/news/zimsit-m-zim-pays-russians-5m-for-diamonds/

Original: https://www.dailynews.co.zw/articles/2017/05/04/zim-pays-russians-5m-for-diamonds