/ 7 November 2010

Zim gem smuggling fuels cross-border dealer hub

Waving his index finger into the balmy heat, the taxi driver barely pauses while driving through the hub of international diamond dealers who have set up near Zimbabwe’s border.

“Here Lebanese. Americans stay here. Ten Guineas stay in that house. Here Pakistan. Here Nigeria,” Raymond Reba (24) offers every few metres, with one man raising a hopeful finger to signal he is open for business.

“There is a buyer. Here another buyer. There again, another buyer.”

Globally these rocks are restricted as “blood diamonds”, with the watchdog Kimberley Process failing to agree last week if it will allow Zimbabwe to resume exports from the country’s controversial Marange fields.

But a short drive away in Manica, in Mozambique, which is a not a member of the Kimberley scheme, dealers openly wait in guarded houses for cross-border sellers who once asked a few dollars for an oil can’s worth.

“They used to cut the top off and fill them,” recalled a 27-year-old Belgian who arrived in the small town four years ago.

News soon spread of the wild profits after a free-for-all digging frenzy in Zimbabwe in 2006, when villagers found gems lying in the sandy soil of the arid Marange hills.

Roadside sellers would wave down motorists with diamond shapes cut out of yellow plastic containers to advertise their bounty, while sellers crossed to Manica to barter dirty pebble-like uncut gems for groceries.

“People started coming here mid-2007. It’s just word gets around,” said the Belgian, who estimates there are 150 to 200 dealers in Manica.

But with Marange’s potential yearly windfalls estimated at $1,2-billion, Zimbabwe’s police soon moved in for a share through abusive syndicates with small-scale miners.

In late 2008, President Robert Mugabe’s government sent in the army, which killed more than 200 people in a three-week bloodbath that saw bodies turned away from the overflowing local mortuary, according to Human Rights Watch.

By the end of the year, the military was forcing locals to dig for diamonds, prompting rights groups to call for a ban on the gems.

Smuggling boom
In Manica, smuggling boomed during Zimbabwe’s electoral violence in 2008, as buyers flew in from around the world, snapping up houses and equipping them with diamond examining and weighing tools.

“In 2006, let’s say, there was about $500 to 600 000 worth of goods coming in every day,” said the Belgian, at a home with two silver 4×4 pick-ups in the yard.

“Then in 2008, 2009, it got a lot more.”

The trade at its peak? “Probably 1-1,2-million a day based on what I used to see — that’s without the big customers,” he said.

“I used to have a customer that would bring me $700 000 worth of goods every week.”

But dealers say fewer smugglers are coming into Manica, since Kimberley restricted Marange gem sales last year over claims of forced labour and torture and ordered Zimbabwe to clean up its act.

Since then, three companies have been licensed to work the field, with two vetted gem auctions taking place.

“We knew business would go down if Kimberley allowed them to start shipping out,” the casual diggers, said the Belgian.

‘I see it’s finished’
But he stops short of calling the stones conflict diamonds, and notes that Mozambique has no laws on diamond dealing.

“What’s happening here is not blood diamonds. It’s just political parties that are a little bit stubborn.”

While some dealers risk crossing the border to buy gems, the sentiment is that Manica’s diamond rush has slowed.

“When I came here I heard everything has closed. For me, I see it’s finished,” said a 23-year-old Lebanese dealer who arrived around six months ago from Kono in Sierra Leone for a trade he acknowledges is illegal.

“You have no future here,” he said, stubbing out a cigarette as a home-shopping TV advertisement played via satellite.

The knock-on stretched beyond the dealers: taxi driver Reba built a house after making nearly $20 000 in five months last year.

“Manica is full of buyers. The good houses you are seeing are because of the buyers or else this could be looking like a very poor place,” he said.

“In the past, every day it would be busy with that business. Now the diamond fields are sealed so there are few people coming here.

“It has really gone down.” – AFP