Zimbabwe halted an auction of 300,000 carats of diamonds from the country’s Marange region before it got underway. Thankful Musukutwa, the secretary of mines, told Voice of America (VOA), a U.S. government news service, that the sale required certification by a Kimberley Process (KP) monitor.
In November 2009, the KP, the global body that aims to prevent “blood diamonds” from entering the market, found forced labor, torture and beatings of villagers by soldiers at the Marange diamond fields. The KP gave the country a June 2010 deadline to comply with a work plan designed to establish reforms or face a diamond trade ban.
Zimbabwe’s Supreme Court ordered the country’s central bank to safeguard 129,000 carats of diamonds from Marange pending the resolution of an ownership dispute, Jonathan Samkange, the lawyer for British firm African Consolidated Resources (ACR), told Agence France-Presse (AFP). ACR contested the cancellation of its mining license in 2007, but the state’s Zimbabwe Mining Development Corporation (ZMDC) took over mining the area.
Obert Mpofu, Zimbabwe’s mines minister, appointed Dingiswayo Ndlovu, his personal assistant, and Sitshengisiwe Moyo, his brother’s wife, to the board of Mbada Diamonds, a joint venture with ZMDC and New Reclamation Group, according to the Zimbabawe Independent. Alex Mukwekweza, Mbada’s chief executive officer (CEO), reportedly resigned.
Mbada Diamonds’ chairman, Robert Mhlanga, was also appointed to the board. Speculation has been rife that Mhlanga was appointed because he bought scrap metal from the state’s Zimbabwe Iron and Steel Company during Mpofu’s term as trade minister, WNC reported.
Meanwhile, Alberto Limeme, head of the border patrol at Machipanda, the main post between Zimbabwe and Mozambique, told WNC that “we don’t have enough personnel for adequate control” of the flow of diamonds. One Zimbabwean diamond trader in the Mozambique border town Manica, who wished to remain anonymous, told IRIN, the UN news service, that Zimbabwean diamonds are sold to dealers from Mali, Nigeria, Somalia, Africa’s Great Lakes region, Israel and Lebanon, who then sell them on the global market.
Representatives from the KP’s U.S. Kimberley Process Authority (USKPA), the Diamond Manufacturers and Importers Association of America (DMIA), Jewelers of America (JA), the Diamond Dealers Club of New York (DDC), the World Diamond Council (WDC), the Responsible Jewelry Council (RJC), the Jewelers Vigilance Committee (JVC), Global Witness, Human Rights Watch (HRW) and others met with top U.S. State Department officials in Washington, D.C., with Martin Rapaport and retailer Brian Lieber participating by telephone. The group urged the KP to take tough action to bring Zimbabwe into full compliance.
— Additional reporting provided by Acquire Media.
De Beers Management Cautiously Optimistic
De Beers management addressed Diamond Trading Company (DTC) sightholders at its annual cocktail party. Nicky Oppenheimer, De Beers chairman, declined to comment specifically on decisions to be made in the coming year, explaining, “we still have to finalize discussions with our bankers.” He warned that “the months ahead still hold too many uncertainties for us to relax and drop our guard.” Despite citing economic instability, a lack of liquidity and consumer confidence as challenges, Oppenheimer was “cautiously optimistic that the worst is behind us.”
Varda Shine, the managing director of DTC, stated, “It is unrealistic to expect consumer demand for diamond jewelry to return to predownturn levels during the course of 2010 and it is more likely to be a year of transition as the world catches its breath.” Noting that the new sightholder contract period is approaching, she said that DTC “is working to simplify the process” with more details to follow in the first quarter.
Gareth Penny, managing director of De Beers, spoke about the years to come. His demand strategies for the future include: distributing diamonds in a way that is procompetitive and commercially robust; ensuring flexible, efficient and effective channels; implementing diamond best practices; working with the retail industry to create excitement for diamonds; International Diamond Board (IDB) initiatives; the consistent and rigorous application of best practice standards and focusing on consumer confidence issues.
GIA Launches Diamond Sorting Service
The Gemological Institute of America (GIA) now offers a diamond sorting service for D to Z color diamonds weighing between 0.15 carat and 0.99 carat. This service is intended to help control clients’ costs by only providing grading reports for diamonds that fall within certain color and clarity parameters, as specified by the client.
To qualify, diamonds must be submitted in bulk. A 50 stone minimum and a total parcel weight is required, but stones do not need to be individually parceled. For more information, contact a GIA gemological services representative via email at jrieger@gia.edu or call 760.603.4500, ext. 7218.
Article from the Rapaport Magazine - February 2010. To subscribe click here.