18 February 2010

Zimbabwe: When Diamonds Become Pawns in a Power Game


Harare — AS the national economic empowerment agenda begins to take root in our country against the backdrop of continuing illegal sanctions whose main thrust was maliciously extended and expanded on Tuesday by the European Union to derail and sabotage the GPA under pressure from the British government with support from Prime Minister Morgan Tsvangirai's MDC-T, two hostile developments have emerged as the evil centre-pivots of the new campaign against the national empowerment agenda.

The first of these developments is the self-evidently malicious media hullabaloo over Mbada Diamonds which is an empowerment joint venture arrangement facilitated by Marange Resources, a subsidiary of the Zimbabwe Mining Development Corporation and two South African- based investors, namely the New Reclamation Group as well as Core Mining and Minerals.

The malicious media hullabaloo over this strategic partnership of immense national interest has been made worse by the ongoing but clearly ill-timed and badly conducted public hearings on Mbada Diamonds by the Mines and Energy Portfolio Committee whose thrust and tone have needlessly if not dangerously opened up the malicious floodgates to the publication of reckless, false and even defamatory information about the joint venture arrangement.

Along with the malicious media hullabaloo around Mbada Diamonds which seeks to undermine Zimbabwe's empowerment drive that is in support of the country's economic turnaround initiatives, there has been a second and equally malicious development highlighted by the campaign by some elements in the inclusive Government led by Prime Minister Tsvangirai against the lawful implementation of the landmark Indigenisation and Empowerment Act whose guiding regulations were gazetted two weeks ago by the Minister of Youth Development, Indigenisation and Empowerment, Saviour Kasukuwere.

These two ill-fated developments constitute a clear and present threat to Zimbabwe's national and security interests and therefore require urgent examination to stop the rot before the smell engulfs the whole nation to the detriment of all of us.

Consider the Mbada Diamonds saga. What on earth is wrong with a 50 percent-50 percent joint venture arrangement to mine and market diamonds by a wholly Zimbabwean national entity, Marange Resources, and two foreign investors -- the New Reclamation Group and Core Mining and Minerals -- with financial, technical and management capacities not available in the country? Is it not obvious that such a venture is a model for national economic empowerment from the start?

Anyone familiar with the record should know that Mbada Diamonds is not a fly-by-night initiative and those in national leadership in Government, Parliament, industry or even the media who are not familiar with the record should not sweat to get it because it is there for the asking.

In this regard, the Government of Zimbabwe deliberated and decided on the joint venture leading to the creation of Mbada Diamonds between July and August 2008.

After an implementation interruption for a year or so which was clearly due to the then political impasse in the country, the inclusive Government subsequently undertook to execute the joint venture in June 2009 with the Minister of Mines and Mining Development, Obert Mpofu, naturally taking the lead to do the needful.

The record will also show that, in support of its subsidiary -- Marange Resources -- ZMDC set up a due-diligence select committee of its board comprising its chairperson G. Mawarire, finance and investment committee chair A. Ndlovu, technical committee member M. Tsomondo and chief executive D. Mubayiwa.

This select committee of the ZMDC board exercised its due diligence on the two Government-approved strategic partners of Marange Resources -- the New Reclamation Group and Core Mining and Minerals in South Africa -- between August 4 and 6, 2009.

Although there has been a lot of dust kicked up by some irresponsible quarters bent on confusing matters and harming our national interest, the fact is that the board's select committee's due diligence report on the two strategic partners for Marange Resources was overwhelmingly favourable on five scores: (a) financial capacity, (b) technical capacity, (c) management systems, (d) business plan and (e) understanding of the operational works on the ground in Marange by the two partners.

The New Reclamation Group was found by the ZMDC select committee to be particularly strong in financial, technical and management terms including the production of a viable business plan.

With a strong background in the key area of scrap metal and despite not having prior experience in diamond mining, New Reclamation demonstrated a strong financial base with a positive balance sheet.

It also demonstrated serious understanding of Marange geology through the expertise of one of its staff members, a Mr James Abson, who is a well known and a highly experienced expert in diamond mining who previously worked in Marange with De Beers.

Core Mining and Minerals has extensive diamond mining experience with mines in Kimberly, South Africa, including alluvial diamond operations in Vaal Bosh which are similar to the Marange imperatives.

The malice of the media hullabaloo over Mbada Diamonds has been exposed by the fact that, instead of focussing on the financial, technical and management capacities of the strategic partners of Marange Resources as investors, a lot of hot air has been generated about alleged but unproven indiscretions by Minister Obert Mpofu by people who clearly have vested interests and who are apparently acting as foreign agents doing terrible things that are harmful to our national economic interests.

For example, while little has been said about the true position of the two strategic partners of Marange Resources and the unchallenged viability of Mbada Diamonds on what it is actually doing on the ground, a lot has been alleged and insinuated against Minister Mpofu personally.

Some of the hopeless insinuations have been that the Minister engaged Dr. R. Mhlanga on ethnic grounds when the truth is that Dr. Mhlanga, whose experience in the sector speaks for itself is from Manicaland province while Minister Mpofu is from Matabeleland North.

There have also been widespread reports and endless rumours that Minister Mpofu allegedly appointed a sister in law, one S. Mpofu, to the board of Mbada thereby raising the spectre of corruption.

Yet the truth is that Ms. S. Mpofu is a former wife of Japhet Mpofu, a former hotelier and now farmer who comes from Matobo in Matabeleland South and who is most definitely not related to Minister Mpofu save for the commonality of their surnames as Zimbabweans. The notion that every Mpofu out there must be somehow a blood or family relative of Minister Mpofu is too primitive for comfort in 2010.

Why such trivial insinuations and false allegations have risen to regular bar talk, boardroom gossip and even purported news dissemination just boggles the mind.

This is because Mbada Diamond is a serious national initiative undertaken by the Government of Zimbabwe with the participation of serious foreign investors who, while they have the financial, technical and management capacities to complement ZMDC's experience through Marange Resources, also have a reputation to protect as international business players. What investor out there is happy to be an open political book of political football?

This vital point has been lost to the Parliamentary Portfolio Committee on Mines and Energy which has succeeded in creating a nationally embarrassing circus over Mbada Diamonds well before the tabling of its report before the House of Assembly.

That is a shame because it undermines the important role of legislative oversight that the Committee chaired by Honourable Chindori-Chininga does not seem to understand at all.

The difference between legislative oversight and a circus is like that of day and night. It is wrong for Parliament to seek to prejudge or even micromanage the executive branch of Government through its portfolio committees. Given that our country is under illegal and malicious economic sanctions imposed by the US and the EU, and given that ZMDC itself was included under those illegal sanctions, and further given that Zimbabwe's detractors do not want the country to benefit from any diamond mining so as to deny it the ability to raise resources for various public purposes including the salaries of civil servants, it is unthinkable that the Mines and Energy Portfolio Committee has allowed itself to become a willing weapon against Zimbabwe's economic interests represented by Mbada Diamonds.

If those hearings in Parliament are necessary under the pretext of oversight, why are they not being held in camera to protect their integrity and the national interest?

Why has the committee allowed patently false and highly personalised reports to be published without correction in advance of the committee's report?

Above all, who in that Committee really believes that the ongoing circus emanating from its hearings will promote joint ventures in Zimbabwe with foreign investors?

Is it not obvious that those hearings are almost in fact scaring away prospective foreign investors who may rightly or wrongly view these ill-advised hearings as mafia type tactics employed by competing interests in mining and some foreign governments that are working with dark political forces in the country that have a hidden plot against the national empowerment agenda?

The fact that this hullabaloo against a solid empowerment initiative such as Mbada Diamonds is happening at a time when Prime Minister Tsvangirai and his MDC-T cronies, who support the illegal Western economic sanctions against Zimbabwe despite being in Government, are waging their cacophonic campaign against the lawful implementation of the landmark Indigenisation and Empowerment Act makes a bad situation worse.

There appears to be a well-orchestrated and decidedly destructive connection between the campaign to derail Mbada Diamonds largely emanating from the Energy and Mines Portfolio Committee in Parliament under a manifestly flawed cover of legislative oversight on the one hand and Prime Minister Tsvangirai's lawless campaign against the Indigenisation and Empowerment Act under spurious claims of promoting foreign investment on the other.

This destructive connection has exposed Tsvangirai's anti-Zimbabwe stance and has given yet another window into our understanding of his support for the illegal American and European sanctions that are devastating our country. It is now common cause that whenever there is an issue between foreign interests and Zimbabwean interests, Tsvangirai will be found on the side of those foreigners who do not want to see any foreign investment in Zimbabwe and who are generally opposed to national economic empowerment.

At least Zimbabweans now know why Tsvangirai is against national economic empowerment, what they do not know is why some comrades in Zanu-PF seem to be also in the same groove under the cover of nightfall. Time will tell.

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