SA firms 'in shady Zim deals'

Harare - Controversy deepened on Monday over the Zimbabwean government's handling of the Chiadzwa diamond field in the eastern Zimbabwe, with revelations of serious irregularities by the mines minister and the South African companies involved.

A parliamentary committee heard on Monday of the attempted illegal sale of 300 000 carats of diamonds by officials of a South African-based company that was supposed to be in partnership with a Zimbabwe state mining company.

Also revealed were allegedly unprocedural appointments by Mines Minister Obert Mpofu to the board of the joint venture company, and the theft of 27 high-quality diamonds by top executives of a second company also working the diamond fields in partnership with the state mining company.

Chiadzwa is regarded as the most prolific diamond find of the century, and a potentially massive boon to the once prosperous country that fell into economic ruin in the last decade.

MPs were told at a public hearing Monday that Mpofu had chosen two South African-based companies, Reclam and Core Mining, to go into partnerships with the state-owned Zimbabwe Mining Development Corporation ZMDC. This company then formed locally registered companies Mbada Diamonds and Canadile Miners.

Mpofu was supposed to appoint five members to represent ZMDC on Mbadas board, said ZMDC chief executive Dominic Mubaiwa, but he chose a Zimbabwean ex-military officer who is in partnership with Reclam.

Another director was identified as Mpofu's personal assistant in the mines ministry, and a third has been named in the local press as the wife of Mpofu's brother.

MPs said their research into Canadiles board members and had turned up the names of diamond smugglers from the Congo and mercenaries from Sierra Leone.

In early January, Mubaiwa said, he was surprised to see Mhlanga on local television announcing that 30 000 carats of Mbada diamonds were going to be auctioned the next day, even though its stones could only be legally sold by the state minerals marketing body.

MPs said Chiadzwa was being run by bush jungle management and that the arrangements with Mbada and Canadile would not bring any earnings to the country.

Said committee chairperson Dan Chininga-Chindori: "The country is starving, the government has no money, and you are playing around with our assets."

- Sapa