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Zim losing millions through gemstones smuggling- CNRG

Staff Writer

Much of Zimbabwe’s coloured gemstones are smuggled out of the country while most of the gemstone dealers are unlicensed. The illicit mining and trade of gemstones is attributed to corruption and poor regulation of the sector which is governed under the Precious Stones Trade Act Chapter 21:06 and Statutory Instrument 256/2019.

The Minerals Marketing Corporation of Zimbabwe, which is mandated to regulate marketing of gemstones has been far less efficient compared to gemstone marketing systems in neighbouring countries such as Zambia.

The authorities have been reluctant to close the loopholes and review the regulatory framework as the current weaknesses benefit those with access to mining and export licences who are invariably the politically connected. The dealers, that are protected by politically connected miners with licences, supply foreign buyers who come through Zambia and Mozambique. These actors form part of the international syndicates that supply gemstones to destinations in Asian countries.

Despite an endowment of highly diversified mineral resources, with high commercial profitability, the economic and social developmentin Zimbabwe is still lagging behind. Among these mineral endowments are gemstones, comprising diamonds, emeralds and ‘semi-precious’ coloured stones, all which have enormous economic potential for Zimbabwe and worth over 20 billion dollars. Mining in Zimbabwe has now become one of the largest economic activity responsible for 60% of the country’s export earnings and 16% of the national GDP.

While Zimbabwe has set a USD12 billion mining industry target by 2023, the country is grappling with corruption illicit activities and leakages of minerals, which is feeding international organised criminal syndicates. Whereas a lot of focus has been on leakages of diamonds and gold, as precious minerals, the illicit trading in and smuggling of semi-precious stones has been going unchecked.

Zimbabwe is losing millions of dollars in potential revenue through well-orchestrated international trafficking syndicates smuggling these semi-precious minerals or gemstones. The policy and security loopholes that characterise the mining sector have equally affected the gemstone industry.

The Centre for Natural Resource Governance conducted a study to investigate the existence, scale and nested nature of illicit coloured gemstone dealings in Zimbabwe in order to reveal the corruption and its links to international syndicates. Information gathered through the research informed the recommendations outlined herein, that are meant to curb leakages of coloured gemstones and illicit financial flows in the gemstone industry.

The study employed a mix of self-reporting approaches of primary data collection, observation and desk review as a form of secondary data collection for purposes of understanding the context and synthesizing existing information on Zimbabwe’s coloured gemstone industry.

Physical visits and observations were made to Hurungwe, Mutoko, Mudzi and Mberengwa districts, where in-depth interviews targeting miners, dealers, households and community leaders were conducted. Discussions with key informants in the law enforcement and gemstones sectors also provided explicit details of some of the activities. The Covid19 Lockdowns restricted focus group discussions and any other interactions with large groups of people during data collection.

Based on the findings the study recommended the need for government to meaningfully liberalise gemstone trade and mining to allow ownership of these mineral resources by local communities who should appreciate the benefit of marketing the stones through formal channels. Accountability of mineral resources can be improved if data on mining and export revenues is accessible by all interested individuals and institutions.

Read Full Report : https://www.cnrgzim.org/_files/ugd/e33f9c_64e4cc465c9a4e7cb319aff2ba604098.pdf?index=true

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