Jan 10

Experts Say Zimbabwe Diamonds Help Mugabe’s Political Machine

Even if Mr. Mugabe’s allies in the mining ministry are telling the truth about the number of diamonds produced, the treasury was still shortchanged by at least $60 million last year, according to a budget report by the finance minister, one of the president’s chief opponents.

But the amount of money being withheld from the nation’s coffers may be much larger than that. Experts, and even some members of Mr. Mugabe’s own party, say the president’s allies are lowballing the nation’s diamond figures by millions of dollars, hoping to hide the fact that profits are being diverted for personal and political ends.

“The benefits of the diamond sales go primarily to allies of the president,” said Mike Davis, a specialist at Global Witness, a group that has extensively researched the contested mines in eastern Zimbabwe, known as the Marange fields. The strategy, Mr. Davis added, was “part of a wider attempt by people around Mugabe to seize the diamond wealth for their own political purposes, which in the short term means beating and cheating their way to another election.”

Now that Mr. Mugabe no longer controls the Finance Ministry — the result of a tenuous power-sharing arrangement to end the rampant state-sponsored violence during the 2008 presidential election — analysts say he needs outside income to finance his political operations. Diamonds offer him a rare opportunity to do that, especially now that international monitors have agreed to let Zimbabwe sell vast quantities of them, despite repeated warnings that it would enable Mr. Mugabe to tighten his grip on the nation.

Recent expenditures by Mr. Mugabe and his security forces have worried observers that unaccounted money from Marange, estimated to be one of the world’s richest troves because of its volume of diamonds, is financing his party’s groundwork for the early elections he is seeking next year.

The country’s defense forces, which answer to Mr. Mugabe and helped secure his victory in the last election by force, recently bought a large shipment of weapons and equipment from China, local news media reported. The mining ministry has paid millions of dollars in salary increases for civil servants outside its ranks, a form of patronage intended to win votes, according to some lawmakers and watchdog groups. And Anjin — a Chinese mining company in Marange that local and Western officials say the Zimbabwean military has a direct ownership stake in — is financing a new military academy.

“It’s quite clear that there’s much more money floating around than is justified by the level of economic activity,” said Eddie Cross, a Mugabe opponent in Parliament. He told the legislature in October that, based on information from geologists and production records, one company alone mined $1.4 billion in diamonds in Marange last year, far more than the $300 million the mining ministry had reported for all its operations there.

Questions about the diamonds have even caused some splintering within Mr. Mugabe’s party, ZANU-PF, as some benefit personally while others get cut out.

“I personally don’t think the numbers tally at all,” said a former senior ZANU-PF official, speaking anonymously to maintain relationships within the party. “When you look at the fields they are mining and how rich they are and what they later declare, you see that there must be a huge difference.”

“People are asking, ‘Where is the diamond money?’ ” the official added, “and the answers don’t seem to be coming out.”

While Mugabe officials deny any sleight of hand, other members of his party acknowledge that the nation’s mineral wealth does not always make it into the public treasury.

Edward T. Chindori-Chininga, a ZANU-PF member who is chairman of the Parliament’s committee on mines and energy, said that while 60 percent of the country’s exports came from mining, the sector accounted for only 10 to 15 percent of the government’s revenue. All of Zimbabwean mining, including platinum and gold, needs to make sure “that the money truly does come” to the treasury, he says, though he argues that there is no evidence of his party using any money improperly.

A Zimbabwean journalist contributed reporting.

Jan 10

Diamond Crackdown in Mozambique Leaves Smugglers Behind

Mr. Phiri and his fellow diamond smugglers had gotten into an argument with the soldier because, for the second consecutive night, he had directed them to a patch of the rich fields where there were no diamonds to be mined. And so they refused to pay him a bribe for allowing them onto the fields, in an area known as Marange. The soldier threatened force.

“If you want to shoot, shoot,” Mr. Phiri recalled barking at the soldier. “But I’m not paying.”

Mr. Phiri and his comrades walked away unharmed, but in more than three months he has not dared return to the fields, an acknowledgment of the increasing dangers for the black-market miners who once dominated an area that may be one of the world’s most lucrative diamond troves.

Ever since President Robert Mugabe of Zimbabwe began to tighten his grip about three years ago on the mines in Marange, where security forces and companies with ties to him are mining at least hundreds of millions of dollars’ worth of stones, the illicit diamond business here has all but dried up. Border towns like this one have become echoes of what they once were.

In November, an international coalition created to prevent the trade of rough diamonds that fuel conflict approved the unlimited export of stones from Marange, giving Mr. Mugabe even more incentive to consolidate the diamond wealth, primarily for himself and his allies, according to human rights groups and Western officials.

Now the people in these diamond towns, who have made their living smuggling stones from Marange since the fields were first tapped more than five years ago, say that the dangers presented by Mr. Mugabe’s forces and private security teams make it far too risky for them to sneak through the barbed-wire fences patrolled by soldiers, police officers and private security guards with attack dogs.

The result for places like this sleepy village of dirt roads, as well as for Manica, a more developed border town several hours north, has been a stripping of what little vibrancy and economic activity they had, legal or otherwise. Here in Espungabera, tucked in rolling green mountains, former smugglers have been left with little to do. The one nightclub in town has closed, and people pass their days playing snooker at one of several taverns.

“It has become a ghost city since last year,” said Ibraimo Mereia, 27, who made his last trip to Marange in April.

In the town of Manica, the days of foreign buyers and traders openly haggling over stones and inspecting them at local restaurants and businesses have given way to empty dining rooms. Former diamond smugglers can now be found plunging into deep holes, smeared with red clay, as they pan for gold on the edges of town.

The reduction in smuggling is the product of more than a security crackdown at Marange itself, Mozambican authorities said. After a meeting over the summer with Zimbabwean security officials, local authorities introduced measures to rein in the practice from the Mozambican side, said Belmiro Mutadiua, a spokesman for the provincial police of Manica, which is about the size of West Virginia and includes Espungabera.

Local authorities have increased the number of border guards and are training new ones, Mr. Mutadiua said. They also are relying more heavily on informants and doing intelligence work. Although he could not give an exact figure, Mr. Mutadiua said that the police had intercepted more shipments of minerals and stones than last year, including diamonds, emeralds and quartz.

Naturally, many here may not see the evaporation of their underground industry as a good thing.

More than half of Mozambique’s adults are below the poverty line, and the country is one of the 20 poorest in the world, according to Unicef. Many people survive on subsistence farming. The country’s mineral wealth — gold, copper and iron — is largely untapped. The narrow shoulders of busy highways are full of people walking miles for water from wells or food from fields. People nonchalantly balance bundles of branches, stuffed bags or other items on their heads as they walk.

But the police cannot worry about whether smuggling helped the economy, Mr. Mutadiua said.

“The smuggling of precious stones is illegal,” he said. “We are just doing our job.”