Zimbabwe's Diamond Production Surges in H1 2017 After Capital Injection

Mining and Exploration
24/07/2017 13:55

Zimbabwe's rough diamond production surged to 1.1 million carats in the first half of 2017, compared to 690,000 carats produced in the entirety of 2016 (the newspaper NewsDay last month cited 2016 production as 961,000 carats), said Finance and Economic Development Minister Patrick Chinamasa. He attributes the sudden rise to the government's $30 million capital investment in equipment for Zimbabwe Consolidated Diamond Company (ZCDC), which has enabled the mining company to shift from low-vale alluvial mining to more lucrative conglomerate and kimberlite diamond mining. 

"The ongoing reforms in diamonds and the coal industry are already seeing the turnaround of these sub-sectors, providing impetus for higher growth in mining," said Chinamasa. A Reserve Bank facility enabled SCDC to obtain mining equipment from Belarus. The equipment has begun to enable ZCDC to transform its mining activities, according to the minister's statements. ZCDC is now mining concessions in Marange after having taken control of them from companies whose licences were not removed after the companies were said to have withheld proceeds from the government despite claims of massive earnings. Back in January of this year, the government announced it was seeking $300 million in investments, but has now invested its own resources.

Now, "There's a new arrangement with ZCDC that since we are capitalising it, automatically the diamonds belong to the fiscus," said Chinamassa. He said, "Every diamond output will come to the fiscus" through the Reserve Bank of Zimbabwe. This would, "Ensure that we get maximum realisation" on the proceeds from diamond mining in the country. Last May, Chinamasa said the government would inject $80m into the ZCDC, and in June Mines minister Walter Chidakwa told the Zimbabwe parliament yesterday that ZCDC still has 300 million tons of diamond ore to mine in Chiadzwa