ZImbabwean Diamonds Minister Mpofu, Kasukuwere attack indigenisation law critics

Mines and Mining Development minister Obert Mpofu and Indigenisation minister Saviour Kasukuwere Thursday attacked critics of indigenisation laws and said some of them were being used as mouthpieces of Western countries.

The two were addressing the Parliamentary Portfolio Committee on Mines and Energy on indigenisation in the mining industry.

Mpofu said Zimbabwe’s diamonds had enriched countries like Israel and India, saying the Reserve Bank of India was even built using diamond money from Zimbabwe when Zimbabweans were not benefitting from their natural resources.

“In dealing with issues of indigenisation, we should not be mouthpieces of detractive interests because we are the only country in the world which has not benefitted,” said Mpofu.

“We have enriched neighbours and sometimes I get emotional to hear colleagues challenging the measures that government has taken to empower Zimbabweans,” he said.

Mpofu attacked Australia and Britain saying they were at the forefront of banning Zimbabwe from selling diamonds, yet they were the major beneficiaries.

“We had De Beers for 15 years in Chiadzwa and have records of more than 100 000 tonnes of diamond ore taken to South Africa and yet you hear people making noise about diamond transparency. We need to know who is looting our resources,” Mpofu said.

Mpofu said those who had mining claims but were not putting them to full use stood to lose them.



“Government will apply the work it-or-lose-it principle on mining claims. If one does not work, he will lose the claims. We have people who own two thirds of the Great Dyke but are only exploiting a tenth. What this has done is to block new investment and is holding the country to ransom and denying the people of Zimbabwe what belongs to them,” he said. Kasukuwere vowed there was no going back on indigenisation and urged companies to engage the government.

“Mpofu is under fire with the Kimberley Process because we want to share the honey. Investors are welcome but we are not going to sit and allow a situation where we are exploited,” said Kasukuwere.

http://www.newsday.co.zw/article/2011-05-13-mpofu-kasukuwere-attack-indigenisation-law-critics

Zimbabwe may sell diamonds to launch gold-backed currency

HARARE (Commodity Online): Zimbabwe may sell diamonds for gold, so that it can have a gold-backed currency, according to a recent proposal from the governor of Zimbabwe’s central bank.

The Zimbabwean dollar is no longer in active use after it was officially suspended by the government due to hyperinflation. The United States dollar, South African rand, Botswanan pula, Pound sterling, and Euro are now used instead. The US dollar has been adopted as the official currency for all government transactions with the new power-sharing regime, says Wikipedia.

But the central bank of Zimbabwe—Reserve Bank of Zimbabwe (RBZ)—believes that the US dollar is no longer stable.

According to Dr Gideon Gono, RBZ Chief, the inflationary effects of United States’ deficit financing of its budget may impact foreign countries and would lead to a resistance of the green back as a base currency; cited newzimbabwe.com.

Writing in a blog in New Zimbabwe, Gilbert Muponda, an entrepreneur based out of Zimbabwe has welcomed the proposal of a gold-backed Zimbabwean currency. He has applauded the proposal of the central bank governor to sell diamonds for gold.

The country is a resource hub: It sits on gold reserves worth trillions. It has the world’s second largest reserves of platinum, has got alluvial diamonds that can fetch the nation $2 billion annually and even boasts of chrome and coal deposits.

But the government’s protectionist measures have kept the mining companies at bay. The government wants the foreign miners to sell controlling stake in ventures to local blacks, which is obviously frowned up on by all. The companies, given the uncertain situation, have refrained from investing further in expansion activities in Zimbabwe.

The country cannot access foreign credit as the ZIDERA Act passed by the United States in 2001 blocks US entities from trading with certain Zimbabwean institutions and individuals This has forced the US representatives in lending agencies like World Bank, IMF, IFC, and ADB to take an unfavorable stance when it comes to Zimbabwean credit requests.

Naturally, the risk premium goes up and the banks play it in the back foot.

“The events of the 2008 Global Financial Crisis demand a new approach to self reliance and a stable mineral-backed currency and to me, Gold has proven over the years that it is a stable and most desired precious metal,” the RBZ Chief was quoted by newzimbabwe.com as saying.

Well said!

http://www.commodityonline.com/news/Zimbabwe-may-sell-diamonds-to-launch-gold-backed-currency-2011-05-20-39184-3-1.html