Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Despite being the world’s fourth-largest diamond miner, Zimbabwe is still one of the poorest countries in the world. Now things can only get worse.
Diamond mining firms operating in Zimbabwe’s Marange deposit are expected to cut around 400 jobs this week as it has become economically unviable for them to dig any deeper for the precious stones.
According to AllAfrica.com, Chinese firms Anjin and Jinan are among the miners that have already ceased operations and will be shutting down mines because Marange has run out of alluvial diamond deposits. These rocks are those close to the surface and so easily extractable through open cast mining.
The news doesn’t come as a surprise. Late last year the country’s Mines Minister, Walter Chidhakwa, acknowledged the issue and warned the existing miners had neither the expertise nor the resources to search for new deposits underground the country’s current major diamond source.
Some experts believe that Marange is the largest diamond discovery in generations but the find has been dogged by allegations of human rights abuses and corruption going right to the heart of Robert Mugabe’s government.
If more firms follow Anjin and Jinan’s steps, the southern African nation’s economy, which is counting on its diamonds to boost its weak economy, may never recover from the impact, experts believe.
The Marange fields, 400 km east of the capital Harare, have been a constant focus of controversy ever since 20,000 small-scale miners invaded the area in 2008, being violently removed later by soldiers and police.
They are controlled by the government’s affiliate Zimbabwe Mining Development Corporation (ZMDC), which has partnership agreements with seven private entities, most of which are speculated to have ties with Zimbabwe ex-military and political officials.
The country, one of the world’s top diamond-producing nations, holds about 25% of the world’s reserves of opencast extractable diamonds.
Image: Zimbabwe’s diamonds miners, screenshot from VOAvideo.
4 Comments
Gary
What’s become of the 100’s Millions $$ worth that have been taken out over the last years? If it is such a large rich deposit, one would have thought that money would have been put aside for exploration and the necessary mining equipment required to go deeper?
miket
South Africa had better get ready for the next wave of illegal immigrants !
drift123
You are talking about the country of zimbabwe. It is not a normal country.
It is almost as if it goes out of its way to impoverish the average person.
The 100’s millions of diamond were probably smuggled out of the country into safety deposit boxes around the World.
Whenever the population starts to get agitated about a lack of jobs or food the government just blames the descendants of Dutch and English Farmers.
The zimbabwe population seems to be easily mislead so as the saying
goes, “People get the kind of government they deserve”.
With Namibia breaking ranks with De Beers, the price of diamonds will come down in price since the genius of De Beers was to limit the amount of diamonds on the
World market (as best they could) which kept the price of diamond high.
LAMB
This comes as no surprise to anyone who has worked in Zimbabwe – MUGABE and friends are notorious for their exploitation of the land and the people living there. While Mugabe bad mouths the Dutch & English, it is those very people who have worked hard to establish viable industries only to have MUGABE and friends take it away and destroy it through their greed. This bunch just do not know how to nurture the resources of their own country – they deserve what they get.