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Zimbabwe to Collect Diamond Revenue at Point of Sale

Aug 6, 2014 11:25 AM   By Jeff Miller
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RAPAPORT... Zimbabwe's Mines and Mining Development Minister, Walter Chidhakwa, told a parliamentary portfolio committee that the government will now collect its share of diamond revenue at the point of sale rather than wait for its mining partners to remit dividends, according to The Herald newspaper.

Zimbabwe's treasury has long stated that country's share of diamond revenue failed to materialize. The Zimbabwe Mining Development Corporation (ZMDC) is the government's mining arm that holds a 50 percent stake in each of the firms mining diamonds across the Marange, including Mbada Diamonds, Anjin Investments, Diamond Mining Company, Jinan and Kusena. The government owns Marange Resources outright.  ZMDC, Mbada Diamonds and Marange Resources are on the U.S. list of sanctioned companies.

The newspaper stated that 15 percent of diamond royalties are owed to Zimbabwe's Revenue Authority (ZIMRA) and 2 percent is owed to ZMDC. "We have now worked out a way of saying let's not wait to share our dividend at the end of the year," The Herald quoted  Chidhakwa as saying. "The rest we share 50-50: this one goes into a government account and this one goes straight into the partner's account. That is the system basis which we are working on now."

In addition, Chidhakwa said the Minerals Marketing Corporation of Zimbabwe, which is also on the U.S. sanctions list, is no longer relevant in marketing minerals.

The government claimed that diamond revenue in 2013 fell 38 percent year on year to $466.9 million. However, according to the Kimberley Process Certification Scheme, Zimbabwe’s production value declined 14 percent to $538.5 million as  volume fell 14 percent to 10.41 million carats and the average price dropped 3 percent to $51.72 per carat. 

Tags: Diamond mining, diamond sales, Jeff Miller, Marange, revenue, Zimbabwe
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