Lucara Diamonds - 1111ct and 813ct Stones
Lucara Diamonds - 1111ct and 813ct Stones

The Zimbabwean government on Monday ordered six diamond mining companies to immediately stop operations in the country’s Marange region.

Lucara Diamonds - 1111ct and 813ct Stones

Mines Minister Walter Chidhakwa told executives of the six companies that their licenses have expired and that they have 90 days to vacate and remove their equipment and valuables.

The decision came after the companies rejected the government’s proposal to merge their operations and to let the state hold a 50 percent stake in the merged entity.

After squeezing out individual miners, Zimbabwe allowed large enterprises to mine the Marange diamond fields in 2010. The country began to supply gems on the international market one year later.

However, due to the dwindling alluvial diamond deposit, the country’s diamond output plunged from the zenith of 12 million carats in 2012 to 3.3 million in 2015, causing sharp decline in revenue and contraction of mining sector in the country last year.

As a result, Zimbabwe’s economic growth has also slowed down to 1.5 percent last year, the lowest in six years. In a bid to raise revenue, the government put forward the merger suggestions.

After the rejection by the mining firms, the government declared that it had created a state-owned Zimbabwe Consolidated Diamond Company that holds all the diamond reserves in the country.

Shingai Manyeruke, general manager of Anjin Investments, one of the affected firms, told Xinhua that the government’s abrupt order has taken them by surprise.

“Everything just happened so fast. It took us by surprise and consultations are currently in progress with all the holders. Once that is done we will then come up with a concerted position,” he said through phone.

The Marange diamond fields in eastern Zimbabwe were first discovered in 2006 and believed to hold 25 percent of the world’s diamond reserves.

Source: Xinhua, February 23, 2016

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