Zimbabwe cannot sell its stockpile of diamonds because the stones have been flagged as conflict gems by international buyers.
Global diamond buyers are shunning gems extracted by the state-owned Zimbabwe Consolidated Diamond Company (ZCDC) because of reports of human-rights abuses. This has been exacerbated by litigation and corruption.
ZCDC's first diamond auction last year attracted only 13 of 49 invited international buyers. Most turned down the invitation because of the "conflict-ridden diamonds".
A US jeweller, Blue Nile, became the first buyer to publicly blacklist ZCDC, citing gross human-rights abuses.
"Because of the reported human-rights abuses in Zimbabwe's Marange diamond district, Blue Nile will not purchase or offer diamonds from that area," the jeweller said on its website.
BLACKLIST THREAT
The jeweller threatened to blacklist any of its suppliers that acquired the diamonds, a move that has further shrunk Zimbabwe's diamond export market.
ZCDC CEO Roberto de Preto confirmed that the state firm was struggling to find markets for its stones.
"We have limited money. If we don't sell our diamonds, we don't get money to come in. So we must, first of all, fix the problem. The problem is we must sell our diamonds," he said.
ZCDC spokesperson Brian Mangwende and mines minister Winston Chitando did not respond to Sunday Times questions about why the miner was struggling to secure export markets.
ZCDC data shows that the company produced about 5.5-million carats of diamonds between 2016 and 2018 but has sold only 423,066 carats in two public auctions for a total of US$29.13m.
• 5.5m - carats mined between 2016 and 2018
• 13 international buyers attended the ZCDC’s first diamond auction last year
— IN NUMBER
The mines ministry has directed ZCDC and the Mineral Marketing Corporation of Zimbabwe (MMCZ) to work on a calendar of regular auctions. The corporation is responsible for all mineral sales in Zimbabwe, except gold and silver.
Half of the ZCDC's top executives were recently fired when they allegedly forced the corporation to sell diamonds to a blacklisted buyer.
James Mupfumi, the director of the Centre for Research and Development, said it was difficult to trust any information from the ZCDC and MMCZ because of a lack of transparency on diamond sales.
The Centre for Natural Resources Governance warned that Zimbabwe would be blacklisted by all international buyers if it did not address human-rights violations in the Marange diamond fields.
"Once one jeweller blacklists diamonds from a certain region, many will be influenced to do the same," said the centre's executive director, Farai Maguwu.
"The solution is to stop the crimes against humanity being committed by ZCDC security personnel."
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