Govt to act on mineral smuggling: PM

Tsvangirai said the government was unhappy that a substantial amount of revenue from mining continued to be lost through corruption, smuggling and other illegal activities to the detriment of national growth.

This is a situation that will not be allowed to continue and government is working to ensure that the mining industry plays its full role in resource mobilisation, the premier told a meeting of local and foreign business leaders held on the sidelines of this years Zimbabwe International Trade Fair (ZITF) in Bulawayo. He however did not specify the measures on the cards to contain the mineral smuggling and corruption in the mining sector.

A recent report revealed that Zimbabwe earned up to US$300 million per month from mining operations at the controversial Chiadzwa diamond fields alone but the bulk of the money never finds its way into government coffers. The report said the two companies contracted by the Harare authorities to mine diamonds at the Chiadzwa fields in Marange were raking in between US$30 and US$300 million monthly. But most of the high grade diamonds were going out the back door while only the lower grade industrial stones were put on public

display.

This is more than enough to meet the recurrent expenditure needs of Zimbabwes cash-strapped coalition regime which is currently surviving on just over US$100 million a month.

About 60 percent of the current government expenditure goes towards the civil service wage bill, leaving the remainder to meet requirements for health, education and infrastructure development.

The state-run Zimbabwe Mining Development Corporation (ZMDC) last year entered into joint venture partnerships with two South African-based companies Mbada Mining and Canadile Mining after throwing out a British company African Consolidated Resources which legally owns the Marange claims. Marange is one of the worlds most controversial diamond fields, with reports that soldiers sent to guard the claims after the government took over the field in October 2006 from ACR committed gross human rights abuses and smuggling.

Human rights groups have been pushing for a ban on Zimbabwean diamonds but last November, the country escaped a Kimberley Process ban with the global body giving Harare a June 2010 deadline to make reforms to comply with its regulations.