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ZIMBABWE PARLIAMENT HEARS REPORT ON DIAMOND MINING COMPANIES’ CONSOLIDATION
07 May 2017

The Zimbabwe Parliament last week heard the Portfolio Committee on Mines and Energy's First Report on the Consolidation of Diamond Mining Companies, which was presented by Dr. Shumba.

The report, published on Zimbabwe's dedicated Parliament website, gives a scathing review of the Zimbabwe Consolidated Diamond Company's (ZCDC) actions and progress, noting that the ZCDC, which was formed as the vehicle to consolidate all the diamond mining activities in the country, had replaced the management of the company with individuals with little or no diamond mining experience. Citing nepotism and tribalism as the criteria used in appointing the current board of ZCDC, Shumba says "it is improper that the ZCDC should be run by a management team that does not have any experience in diamond mining. Surely, the country should not expect positive growth and meaningful returns to emanate from such an operation."

Shumba's report makes particular and repeated reference to the ZCDC's acting Chairman, Professor F.P. Gudyanga, noting that while the Zimbabwe Mineral Development Corporation (ZMDC) is meant to oversee the operations of its subsidiary, the ZCDC, in fact it is ultimately answerable to the Permanent Secretary of Mines and Mining Development - a position held by Gudyanga, which results in a clear conflict of interest.

In reference to the forced consolidation of the diamond mining companies concessions into one entity under the ZCDC, which took place early last year, Shumba notes that, "The grounds for dispossessing the mining companies of their concessions are weak and indefensible. These were joint venture agreements and if the lease had expired, surely ZMDC could have easily reacted to rectify the anomaly. It appears this was just a weak excuse to get rid of the joint venture partners."

Continues Shumba: "It cannot be denied that the consolidation process put a dent on investor confidence into the mining sector. It is important that property rights are respected so that it does not affect investment opportunities for the entire mining industry. When the Committee visited Marange it saw immovable property such as offices, airstrip, employee houses, watch towers, machinery which was lost inadvertently by the joint partners and will now be inherited by ZCDC without paying any compensation."

Following presentation of the report, an extensive list of recommendations was put forward before Parliament, which include a recommendation to develop a policy to integrate artisanal and small-scale alluvial diamond miners who are currently operating illegally in Marange.

It was also recommended that a resolution be passed that, "governmental and political interference in mining of diamonds in Marange should cease forthwith, particularly by the Secretary of Mines," calling for the dismissal of Gudyanga from his position within one month of tabling of the report.
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