Country Report Zimbabwe September 2010

Economic performance: Diamond sales prove disappointing

Hopes that the economy would receive a major boost from diamond sales have receded following the first "legal" sale of diamonds from the controversial Marange fields (June 2010, Economy policy) on August 11th. According to the mines minister, Obert Mpofu, the sale of 900,000 carats raised US$56.4m, of which US$30m will go to the government. Mr Biti had earlier stated that the gems had been sold for US$45m, of which the government would receive just US$15m. Both figures are substantially below earlier official estimates, one of which put potential diamond earnings at around US$1bn a month. Just under one-sixth of the 6m-carat stockpile has been sold, at an average price of US$62 per carat; this suggests that the remaining 5.1m carats will be worth some US$320m.

Further sales are scheduled despite renewed efforts by human rights groups to convince buyers that they are trading in tainted diamonds The US-based Rapaport Group, which claims to be the world's largest diamond-trading network, with members in more than 70 countries, says that it will expel members who trade Marange diamonds. According to the group's chairman, Martin Rapaport, "There is no assurance that diamonds with Kimberly Process certification are free of human-rights violations", adding that the state-owned Minerals Marketing Corporation, which is selling the diamonds, is on the international sanctions list.

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