Along with accusations that companies are not paying their dues, the owners remain a mystery, writes Jason Moyo.
Zimbabwe’s Mines Minister Obert Mpofu estimates that the country’s vast diamond wealth could generate $2-billion a year, but it is increasingly unclear who is benefiting more – the government or the faceless shareholders who own the miners.
Foreigners are still queuing up to get in on the action and South Africa’s Utho Capital is planning to set up a forum of the world’s top diamond companies in Zimbabwe.
The Marange fields cover 123000 hectares, with only 54000 hectares being mined. The remainder is up for grabs, according to the Zimbabwe Mining Development Company (ZMDC), the state mining firm.
But even as international interest grows, the ownership of mines remains hidden under layers of secrecy.
There are currently five companies operating in Marange and other concessions in the east of the country.
Anjin is the biggest miner in the diamond fields and there is conflict over how much it owes the government and who really owns it.
Finance Minister Tendai Biti recently said the government had received nothing from Anjin since it opened in 2009. But Munyaradzi Machacha, an Anjin director, said Biti’s expectations had been too high to begin with.
“We have contributed $30-million to the fiscus. A single carat is valued at $60 and not the $1500 projected by the minister,” Machacha told visiting European ambassadors last week. “He should stop persecuting innocent companies like ours.”
But it is a fact that officially nobody, not even the finance minister, knows who owns Anjin, something that reflects the murky world of Zimbabwe’s diamond industry.
Deputy Mines Minister Gift Chimanikire said that the Chinese owned 50% of Anjin, the Zimbabwe Defence Industries (ZDI), a state-owned ammunitions-maker, owned 40% and the ZMDC held the remainder.
But Biti said the ZMDC did not have any stake in it and he did not know who the other shareholders were.
This week, there was more controversy – apparently the ZDI is not a shareholder in Anjin either. ZDI chief executive Tshinga Dube, a retired colonel, denied that ZDI owned a stake in Anjin. “Such an opportunity has not featured on our radar,” he said.
The question then is: Who owns Anjin and who stands to benefit from its potentially massive earnings?
What is known is that half of Anjin is owned by Chinese firm Anhui Foreign Economic Construction. As part of the deal, Anhui is building a large military complex on the northern outskirts of Harare, which is being partly funded by a $98-million loan from China’s Eximbank.
But what is less well known is the identity of Anhui’s partner, reported to be Matt Bronze, a shelf company bought by the military to house its investments. Matt Bronze’s directors have never been named publicly, but Anjin’s Zimbabwean directors are almost entirely from the security forces.
Mbada Diamonds is a joint venture between the ZMDC and several investors, among them South Africa’s Reclamation Group, which has established links with Zimbabwean state companies.
Old Mutual holds a minority stake in the firm, although it has said it would be reviewing its interests.
Among Mbada’s shareholders is ex-army figure Robert Mhlanga, once President Robert Mugabe’s pilot and now one of Zimbabwe’s richest men. Weeks ago, it was reported that Mhlanga was building a mansion next to the Zimbali Golf Estate in KwaZulu-Natal. He insists he bought the property 10 years ago, before he went into diamonds.
In 2002, Mhlanga was a key witness in the treason case brought against Prime Minister Morgan Tsvangirai, leader of the opposition Movement for Democratic Change.
Through his Skyview Minerals, Mhlanga owns shares in Mbada Diamonds and has other interests in Zimbabwe, Angola and elsewhere in the region.
Recently, Mhlanga said Mbada had made $600-million since 2009. Half of that had been handed to the government in taxes and other fees. The remainder went into working capital and to Reclamation.
In the first quarter of this year, Mbada exported $87.6-million worth of diamonds.
Stung by United States-imposed sanctions, Mbada earlier this year claimed it was under attack from a “jealous and outright anti-Zimbabwe and anti-African agenda”.
Marange Resources is wholly owned by the ZMDC, after the government cancelled a joint venture with Canadile, over claims the consortium had defrauded the state.
But Canadile’s Lovemore Kurotwi has claimed Mpofu demanded a $10-million bribe in exchange for a mining licence. Kurotwi wrote a letter to Mugabe detailing Mpofu’s alleged demands.
Dube is chairperson of Marange Resources. It exported $11.7-million worth of diamonds in the first quarter of the year.
Diamond Mining Corporation
DMC is a joint venture between the ZMDC and Pure Diam, based in Dubai. Pure Diam’s shareholders are unknown. DMC made $38.9-million in the first quarter.
Zimbabwe-Ozgeo is a partnership between Zimbabwe and Russian investors. The company expects to begin operations soon in the eastern Chimanimani area. Russia, a long-time ally, has separately agreed to supply military helicopters in exchange for platinum concessions, according to the Russian newspaper Kommersant.
‘M’ is for ‘make another joke’
At a recent comedy show, Zimbabwe’s most popular stand-up comic, Carl Joshua Ncube, gave the lowdown on what it means to be a comic in Zimbabwe.
“Everyone wants you to say the ‘M’ word,” he said.
While performing in South Africa, there was much moaning when he refused to tell a Mugabe joke. “So they come backstage after the show and say: ‘Carl, here we can go on the streets, stand on the steps of Parliament and shout, Jacob Zuma is an idiot, and no one will do anything to us. You can’t do that in Zimbabwe.’
“And I say: ‘That’s not true, we too can go on the steps of Parliament in Zimbabwe and shout, Jacob Zuma is an idiot.’
“We’re free to say anything we like,” he jokes sarcastically on stage. His audience responds with a round of mocking applause.
Despite recent media reform, including the licensing of two new radio stations, the space for free expression in Zimbabwe remains largely restricted. But, on most Fridays in Harare’s smoky bars, urban youths are finding a new avenue for expression in a growing stand-up comedy movement.
But the young comics have to censor themselves, often delivering biting social commentary but steering clear of direct attacks on the establishment. There are many underground jokes attacking President Robert Mugabe and other leaders, but comics cannot make them on stage in a country where people are frequently arrested for insulting the president.
Last Friday, at a comedy night to mark the first year of a series of shows by a group of 10 comics, dozens gathered under a thatched gazebo in a Harare suburb. These shows were rare just a year ago, but they are winning broader appeal as comics become more daring, taking on issues that many can relate to. – Jason Moyo