The Trajectory of Zimbabwean Marange Diamond Revenue Remittances from 2006 to 2013

Abstract

This study attempts to analyze Marange diamond revenue remittances in Zimbabwe from 2006 to 2013. The case of Mbada Diamond Company was used. The information gathered would either validate or nullify the belief that diamond revenues have not been fully attained to date. The Public Choice Theory propounded by Buchanan will help in explaining why such results have been attained in diamond revenue remittance. This paper was compiled after reviewing some government publications, National Budgets, journal articles as well as employing questionnaires and unstructured interviews. The research found that diamond revenue remitting in Zimbabwe particularly Marange fields were still lagging behind the expectations since the start of mining in 2006. Of the expected billions of diamond revenues only about US$971 million to US$1.6 billion is believed to have trickled into the Consolidated Revenue Fund (CRF) since 2006. The Marange diamond revenue remittances have proved to be trailing their expectations since the first formal sale was conducted in 2010. This was due to a plethora of challenges which includes weak legislative frameworks, corruption, informal diamond trading, technological incompetence as well as the imposition of economic sanctions to the Zimbabwean economy. The study makes some recommendations as to how the diamond revenues could be fully attained and such remedies among others include internal capacity building, passing of a diamond bill, nationalization of mining companies, introduction of a local mineral beneficiation scheme, multi-collaboration of various ministries in diamond revenue collection and subsidizing the mining of diamond to increase productivity. Zimbabwe’s diamond revenues if managed properly, would reduce government external debt, promotes economic development and improves service delivery in the public sector.