Mugabe and Friends Loot $2 Billion in Diamonds, Report Says
It’s no secret that corruption and poor governance can leave a country devastated. But Zimbabwe, which has long been ruled by the corrupt dictator Robert Mugabe, still serves as a cautionary tale.
By almost any measure, the country is in terrible shape. The per capita income is just about $400 per year. The poverty rate is 63 percent. Life expectancy is just 51 years. A few months ago, the United Nations found that 1.6 million people in Zimbabwe would go hungry without emergency food aid.
Surely it would be a blessing if some source of wealth were discovered that could quickly turn the country around. And in fact, that’s exactly what happened – or almost did. In 2006, what may be the world’s most massive diamond deposit was discovered in the Marange district of eastern Zimbabwe.
Unfortunately, the discovery of that diamond deposit hasn’t worked the wonders it should have. What went wrong? A new report by the non-profit group Partnership Africa Canada (PAC) provides a partial explanation. At least $2 billion worth of diamonds from the Marange diamond fields have been stolen by Mugabe, his cronies, and corrupt government officials.
But corruption, we should point out, is not even the most shocking part of the Zimbabwean government’s disastrous approach to diamond mining in the Marange district.
The other problem has been violence. In 2008, the Zimbabwean army seized control of the Marange diamond fields, massacring more than 200 local diamond miners in the process. The army then enslaved local adults and children, beating and torturing the miners to force them to work, and keeping the profits for military leaders and Mugabe allies.
The Kimberley Process, the international diamond certification scheme, responded by placing an export ban on Marange diamonds between 2009 and 2011. During that time, Zimbabwe handed over diamond mining operations to private companies. By the time the ban was lifted, violence was supposed to have ended and mining operations were supposed to have become more transparent.
Some doubt remains about whether the violence is really over. (In 2011, for instance, the BBC reported that the Zimbabwean army was running torture camps near the diamond fields.) But what this latest report from PAC makes clear is that corruption is very much still a problem.
Most of the private companies chosen to mine the Marange diamond fields have ties to Zimbabwe’s military establishment and Mugabe’s political allies. These companies are required to hand over some of their profits to the Zimbabwean treasury, but it appears that some or most of the money that should be paid to the government is being illegally funneled back to the same people who have been stealing it all along.
It’s hard to know exactly how much government revenue is disappearing. The Ministry of Mines, run by Mugabe loyalist Obert Mpofu, releases very little information about how the private mining companies were selected, about the contracts in place, or about the diamonds being produced.
However, the signs of corruption are difficult to ignore. For instance, Mpofu himself has suddenly grown very wealthy. According to PAC, he has gone on a personal shopping spree, spending at least $20 million in cash over the past three years. PAC believes that Mpofu has put at least $2 million into his cattle ranching business and that recent purchases may include 11 houses, a supermarket, and two cruise boats.
Is any of this very surprising? Not really. Mugabe’s government has always been corrupt. And if he and his allies would kill and torture people to control the Marange diamond fields, then they are definitely capable of corruption too.
Perhaps what is most remarkable is that the international community seems so powerless to do anything. The Kimberley Process went ahead and began certifying Zimbabwean diamonds as “conflict free” in 2011 even though everyone knew that Mugabe and his allies were looting diamonds. Mugabe and his friends clearly think that they can get away with stealing billions of dollars in Zimbabwe’s diamond wealth without any major repercussions.
Probably Mugabe and his friends are right – for now. The Kimberley Process was founded to deal with the narrow problem of diamonds that finance civil wars. We do not have much confidence in the ability of the Kimberley Process, which is composed of 74 member countries, to tackle a problem like government corruption.
But over the long term, we believe that major changes in the international diamond supply are inevitable. Consumers in the United States and around the world are gradually recognizing that a diamond with an unsavory history – or just an unknown history – is far less desirable than a diamond with reliably ethical origins.
Eventually, the world diamond supply is going to become much more like Brilliant Earth’s diamonds are now – fully traceable back to their country of origin and mined in a way that benefits local communities and helps countries to build a brighter future. And as norms in the diamond industry change, dictators like Robert Mugabe will have to change too.