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Africa Moyo and Ishemunyoro Chingwere
GOVERNMENT realised a measly $282 million in six years through taxes and dividends from diamond firms that operated in Chiadzwa, a move that eventually prompted the consolidation of the diamond sector in 2016 to boost State revenues.

Dividends generated $188 million for Government while taxes raked in $94,8 million.

This emerged during a Mines and Energy Parliamentary Portfolio Committee hearing on Monday.

Seven private firms – Anjin Investments, Marange Resources, Diamond Mining Company (DMC), Gye Nyame Resources, Kusena Diamonds, Jinan Mining Ltd and Mbada Diamonds – were licensed to mine diamonds at Chiadzwa.

Government, through the Zimbabwe Mining Development Corporation (ZMDC), had entered into a 50 /50 joint venture arrangement with the private investors in the diamond mining projects.

Portfolio committee chairperson Temba Mliswa pressed ZMDC to reveal the monetary value that accrued to Government from the Marange venture from 2009 to 2014.

Then ZMDC board chairperson Godwills Masimirembwa declined to answer the question and passed the buck to a finance official, who said in 2009, no miner declared a dividend since most of them were still setting up on the ground.

In 2010, diamond miners declared $51,8 million in dividends while $73,5 million was declared in 2011.

In 2012, $39,2 million was declared; in 2013 ($15 million) and in 2014 ($9 million) was declared.

“So in total, $188 million was received by the Zimbabwe Government while another $188 million went to the JV partners,” said the official, without explaining the plunge in the value of dividends declared over the period 2010 to 2014.

In terms of corporate tax, the miners paid $34,8 million in 2010; $11,4 million in 2011; $24 million in 2012; $17,8 million in 2013 and $6,9 million in 2014.

Cumulatively, the firms contributed $94,8 million in the period 2010 to 2014.

The revelations by ZMDC come despite claims by Mbada that it paid $472 million in royalties, dividends and other taxes between 2010 and 2015.

ZMDC said the dividends and corporate tax represented combined amounts paid by Mbada, DMC, Jinan and Marange.

However, a visibly incensed Mr Mliswa demanded to know why other companies did not contribute to the fiscus through taxes and dividends, to which the ZMDC finance official could not give a satisfactory explanation.

“The ones that contributed, like I said are Mbada, Jinan, DMC and Marange and these figures are based on audited financial statements.

“Mr chairman, we do not have the financial statements for those entities. The ones I am presenting are the entities that presented financial statements.

“We are not in possession of financial statements for those entities that did not pay tax, possibly the entities can present on their own,” said the official.

But the tirade from Mr Mliswa could only get worse as he was of the opinion that Government could have been prejudiced of millions of dollars in potential revenue since ZMDC exhibited signs of failure to whip the diamond mining firms into line.

It took the intervention of Mr Godwills Masimirembwa, who was ZMDC board chairperson at the time, to further breakdown what transpired.

Mr Masimirembwa said one of the companies, Rera Diamonds, had not started mining during the period under review “so they did not generate any money”.

“Kusena Diamonds were still carrying out exploratory work so to speak, they had really not started mining (while) Gye Nyame had started mining and stockpiling, but there were issues that happened, I think that they will speak for themselves exactly what happened, but the report we have is that one day, they were visited by police and keys to their box that contained diamonds were confiscated,” said Mr Masimirembwa.

It is alleged that the ZRP, which held 20 percent shareholding in Gye Nyame, dispatched eight heavily armed police to swoop on one of the shareholders, Itai Munyeza and demanded keys to the box where diamonds were kept.

Mr Munyeza told Parliament that he was force-marched to a building near the Central Vehicle Registry (CVR) in central Harare where the police details kept demanding the keys claiming they were wanted by former Police Commissioner General, Dr Augustine Chihuri.

It is understood that the diamonds were later sold but no one really knows what happened to the proceeds.

Zimbabwe is estimated to have hauled 16,9 million carats in 2013, representing 13 percent of global rough diamond supply; 12 million carats in 2012; 8,7 million carats in 2011, and 8,2 million carats in 2010.

The average price for the diamonds was $54 per carat while some were sold at about $100 per carat.