20091204

Harare — ZIMBABWE reeled into a crisis after diamond traders blacklisted Marange gems from the international market, despite the country escaping sanctions from the international diamond watchdog, the Kimberley Process (KP).

Old Mutual, which has come under pressure because of its investment in some local counters, which human rights activists said were abetting human rights abuses in Zimbabwe, also relented to pressure over its investment in a company allocated a stake in a project to mine diamonds in Marange.

DiamondGeezer.com, a leading online fine diamond jeweller, said in a statement issued by its publicists on Friday that it had implemented an immediate trading ban on all diamonds from Zimbabwe's Marange diamond fields due to what it described as "severe human rights violations".

"The ban does not apply to all diamonds from Zimbabwe -- only those from the Marange area. Severe human rights violations have taken place in the diamond fields of Marange, Zimbabwe, and the DiamondGeezer.com board of directors has passed a resolution banning the trade or use of any Marange diamonds," the company said in the statement.

DiamondGeezer.com's decision came after the Rapaport Diamond Trading Network, a global network of companies that support the development of free, fair and competitive global diamond markets, said it had banned trading of the gems from Zimbabwe's Marange fields because of severe human rights violations.

Martin Rapaport, the chairman of the network, said the organisation's members would be required to immediately remove all listings of Marange diamonds and to confirm to the trading network that they would no longer knowingly trade in gems from Manicaland.

The network also sent letters to industry organisations asking them to ban the controversial Marange diamonds, which it said were uniquely identifiable.

The move by the diamond players came as pressure built up against the Zimbabwe government over allegations of continued abuse of human rights at the Marange diamond fields, which have been parceled out to several companies said to be linked to top ZANU-PF elites and their cronies.

One of the companies that have set up operations in Marange is scrap metal recycler, New Reclamation Group, of South Africa, which will mine the diamonds under a joint venture with the Zimbabwe Mining Development Corpor-ation, a government-owned mining firm.

The involvement of New Reclamation Group has resulted in activists, as well as African Consolidated Resources, which claims rights to part of the Marange claims, piling pressure on global insurer and investment giant, Old Mutual, which controls a six percent shareholding in the company.

Old Mutual has relented, and ann-ounced last week that it was reviewing its stake in the company, although it noted that New Reclamation's engagement with Zimbabwe's government "post-dated any reported wrongdoing in the mining industry".

The Zim-babwe government, an inclusive outfit consisting three former political protagonists, has denied reports of the abuses, and won a reprieve from the KP, which ordered government to initiate certain processes, including withdrawing the army from guarding the claims.

International human rights activists, who had lobbied for the expulsion of Zimbabwe's diamond from the international market, were however, peeved by the decision.

The Zimbabwe government, which welcomed the KP decision as victory, has promised to comply with its directive.

The KP, to which more than 70 countries are members, was launched in 2003 to curb the flow of conflict diamonds into the mainstream market.

Zimbabwe's diamonds have reportedly been smuggled to other KP members who now fear risking expulsion from world diamond trade if smuggled diamonds continue to find their way into their markets.

allafrica