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ZIMBABWE: Diamonds are Mutare's best friends

Photo: IRIN
Boom times
Mutare, 6 August 2008 (IRIN) - Diamonds have scripted a typical rags to riches story for Bonny, 35, who spent most of his life on the streets before the discovery of the gems three years ago, near the eastern Zimbabwe town of Mutare, transformed his life. "I have, over the last two years, acquired a fleet of 12 cars and several houses in Mutare and in the capital, Harare," Bonny told IRIN.

"When the diamond rush began, very few people believed the stones were precious. In fact, a company which had been doing some explorations here even went as far as to say the stones were worthless industrial diamonds," he said.

"We had nothing to lose because we had little to occupy our time as street dwellers. We collected as many stones as possible and when buyers started flooding in, we realised we had made a lot of money," Bonny said.

Most of the diamond fields are located in the Marange area, about 60km southwest of Mutare, the provincial capital, but wealth is a difficult condition to keep secret; before long, Zimbabwe's ruling elite arrived in a second diamond rush, bringing with them policemen and soldiers to seal off the diamond-producing area.

Entry to the diamond fields is gained by producing a national identity card, proving the bearer is a local resident, or a police clearance letter confirming that the bearer has legitimate business to conduct in the area.

The state-owned Zimbabwe Mining Development Corporation is responsible for mining the diamonds, which are marketed by another state entity, the Minerals Marketing Corporation of Zimbabwe (MMCZ).

The US government targeted both organisations with sanctions in response to the recent elections that were widely condemned as not free or fair, for "undermining of democratic processes and institutions in Zimbabwe".

An IRIN correspondent managed to enter the area after paying a soldier an "entrance fee" of R100 (US$13), and was guided around the diggings by Simeon Nyati, from the Marange area.

Militarised zone

"The whole area is like a militarised zone which can only be accessed by the powerful. There are checkpoints leading into and out of Marange, complete with sniffer dogs," he told IRIN.

"One of the vice-presidents has a big diamond field which is guarded by the military. During the presidential campaigns, President Robert Mugabe visited a diamond field, together with the First Lady, Grace Mugabe. We don't know the reason behind the visit, but one of the most heavily guarded fields is said to belong to the First Family," he alleged.

The diamond boom has made cellphones, a symbol of wealth, a common feature in these rural areas, but appearances were deceptive, resident and retired policeman Talent Makoni told IRIN, as the diamonds had seen the town's population of 150,000 balloon to nearly one million people, stretching the ability of Mutare to deliver services.
''Unfortunately, our clients are not the traditional tourists. They are diamond traders, who usually hire the services of local prostitutes and many actually pay using the scarce US dollar''

The diamond rush also has brought rising levels of crime - last year an official of the ruling ZANU-PF party was arrested after trying to persuade customs officials to allow a Lebanese woman carrying several kilograms of diamonds to board a plane - and sex workers were being drawn to the area to take advantage of the "free spending" diamond dealers, Makoni said.

A hotel employee, who declined to be identified, said they were always fully booked, even though tourism arrivals had declined. "Unfortunately, our clients are not the traditional tourists. They are diamond traders, who usually hire the services of local prostitutes and many actually pay using the scarce US dollar."

A police officer, who declined to be named, said: "There has been an upsurge in crime and corruption following the discovery of diamonds. Our cells in the city are full, and we are now holding some of the suspects in police cells outside Mutare. It is either that the suspect stole somebody else's diamonds, or sold another person fake diamonds."

Outside the town's courthouse there are often an unusually large number of people milling around. "Most of them are here to pay bail money for friends, relatives or spouses engaged in diamond trade," the officer said.

In many cases diamond exhibits used as evidence had been replaced by worthless pieces of glass, the police officer remarked. A visit to the local police housing revealed that despite their low pay, many officers had luxury electrical gadgets and television satellite dishes installed on their roofs.

Zimbabwe economy is in meltdown, with unemployment in excess of 80 percent and annual inflation officially at 2.2 million percent, forcing people to seek alternative ways of making a living.

"Cases of children dropping out of school are higher in Marange, where the diamond fields are found," said an official at the ministry of education, who declined to be identified. "The explanation from the children and their parents is that they see no need to pursue education when diamond panning can provide instant riches."

He said the public service had also lost many employees, who had opted for diamond trading "after seeing the change in lifestyles of other people in the city".  

The majority of shops in Zimbabwe, where even basic commodities are difficult to obtain, have empty shelves, but in Mutare the shop shelves are well stocked with groceries and electrical gadgets, mostly imported from neighbouring Mozambique and South Africa.

Foreign currency only

Widespread use of foreign currencies, such as South African rands, Botswana pulas, the Mozambican metical and the US dollar, instead of the increasingly worthless Zimbabwean dollar, had driven up the cost of living and the local hotels were now charging more than those in Harare, a local journalist, who declined to be identified, told IRIN.

"Transactions in most commodities and services, such as medical consultations, rentals, even purchasing firewood, are now done in foreign currency. Even commercial sex workers now demand payment in foreign currency," he said.

However, other residents said the proceeds from the diamond boom were not a curse but a blessing that had greatly improved their standard of living. Mutare's residential suburb of Murambi was until recently the most affluent in the city, until Murambi East sprouted nearby, where multi-storey mansions are being built on the side of the mountain.

Ephraim Milanzi, a taxi driver, said the profits from diamonds were trickling down to all levels of society and had created a source of employment for hundreds of residents.

"I resigned from the civil service just over three years ago and used to ply the border route when it was less lucrative. When the diamonds were discovered, business improved and I have increased the number of my taxis to four," he told IRIN.

"On average, we gross US$400 a day. Business improves a lot during public holidays. I am now building my second house in one of the prime residential areas."

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Theme(s): Economy,

[This report does not necessarily reflect the views of the United Nations]