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Mungo Soggot
Hlengiwe Mkhize, the truth commissioner tipped to win a major government diamond contract, this week likened her prospective job of assessing the value of rough diamonds to that of compensating torture victims.
Mkhize chairs the local arm of a consortium masterminded by a Belgian diamond broker which is the favourite in the race to become the government’s new diamond valuer – a body with the highly specialised function of determining the value of the $1-billion in rough diamonds South Africa produces annually.
The Diamond Board has yet to announce the winner, but rival bidders, who have expressed misgivings about the tender process, claim Mkhize’s consortium was selected some time ago.
Mkhize, the head of the Truth and Reconciliation Commission’s reparations committee, was coy about her venture into the diamond world, saying she feared any discussion could jeopardise her bid’s chances.
Asked to explain the intriguing contrast between the truth commission and diamonds, she said: “It is not an unusual combination. Valuation is not about … you don’t have to be directly involved in the industry. Actually, you would be surprised how related it is to what one has been doing.”
When asked to elaborate she said: “Well it’s about valuations. It’s not about the industry itself. Actually, if you are an evaluator you cannot be involved in the diamond industry. It is about setting systems, how to monitor, how to valuate …”
Mkhize’s Belgian team-mate, Claude Nobels, runs a company called Cominco. The company Mkhize chairs, DVIC, has a 30% stake in the Cominco bid and appears to have been set up expressly for the deal – its address is that of the Sandton law firm which set it up in August.
She would not discuss her partners in the local arm, saying the consortium consisted of only her and Nobels. She said Nobels could not be contacted.
Mkhize also declined to discuss how she teamed up with Nobels, but industry speculation is that the marriage was brokered by a South African businessman with an intimate knowledge of the Diamond Board.
The chair of the Diamond Board, Gibson Thula, declined to comment. Thula, an influential Johannesburg businessman with close links to the African National Congress, referred all queries to the chief executive of the Diamond Board, Victor Sibiya.
Sibiya said the selection panel’s decision merely had to be endorsed by Minister of Minerals and Energy Penuell Maduna, and that he expected to make an announcement in a few days.
One of the losers, a London-based consortium comprising former employees of diamond giant De Beers, says it was given only 24 hours notice for its interview before the tender selection panel in Johannesburg. Another top contender was London- based Mariott, which is the official valuer in Nambia and Angola.
It is understood that Nobels recently footed the bill for a trip to Antwerp undertaken by several Diamond Board members, but that this did not count against his bid. The Diamond Board took the unusual step of not compiling a shortlist of the 11 bidders, all of which were interviewed.
The valuer will play a vital role in the government’s plan to transform the diamond industry. The previous valuer, Proval, had extraordinarily close links with De Beers, the producer of nearly all the diamonds it had to evaluate the past ten years.
One term in its contract reads: “No association agreement shall be amended or cancelled without the prior written consent of the board and De Beers.” Another says: “No member or employee of Proval shall perform any functions as a valuator under this agreement unless he or she has been recognised as a valuator of diamonds by the board and by De Beers Consolidated Mines Ltd.”
The new valuer is expected to have a less intimate relationship with De Beers.