Government Ignores Court Order On Diamond Claims

Rough diamonds from Marange: the Zimbabwe government is riding roughshod over a court decision for their company, ZMDC, to vacate the diamond claims owned by Africa Consolidated Resources (ACR). The company now says it will prosecute the new partners that the government have brought in to develop the fields together with ZMDC. It appears diamonds will be the curse of Zimbabwe, with the Marange Diamond Fields openly being carved up now. There are specific areas that are known by the locals as belonging to specific politicians. These areas have been fenced off. Under such circumstances, there is no hope that the law will actually prevail. Mugabe knows the language of intimidation and force very well.

Harare, Zimbabwe, 22 November 2009

The Zimbabwe government-owned Zimbabwe Minerals Development Corporation (ZMDC) is refusing to comply with a High Court Order for it to vacate the Marange Diamond Fields and let the owner of the claim, Africa Consolidated Resources, move back in to start operations.

This was said by ACR themselves in a circular to shareholders of that company and reported on in the state media today.

ACR, which has just raised an additional ten million British Pound Sterling for diamond exploration in London, says it now pushing for the Court Order to be enforced.

Says ACR:

"The company has continued to make representations to the Zimbabwe Government that it is willing to cooperate in developing in an orderly manner, a diamond mining corporation at its claims on the Marange diamond fields and it is the desire of the company to enter into arrangements to benefit both the company and the people of Zimbabwe.

The company is aware that the State-owned ZMDC has failed to vacate the diamond fields as instructed by the High Court and has entered into a joint venture with a third party with the aim of establishing a commercial mining operation. It is the intention of the company to seek the enforcement of the High Court ruling, to defend any appeal of that ruling and to litigate against any third party engaging in illegal mining and prospecting activities within the company's claims."

Meantime, the Zimbabwe government is saying it has appealed the matter to the Supreme and will not vacate until the matter is settled in that highest court of the Zimbabwe.

But, to show that there is no intention whatsoever to move out by government, ZMDC has now gone ahead and partnered with two South African investors to start mining the diamond field in Marange. US$50 million is reported to have been spent already on acquiring equipment for the mining operation at the diamond field.

Does this sound like the doings of a company (or government) that has any intention of obeying the courts is the Supreme Court rules against them?

Mugabe is confident that, with Chief Justice Chidyausiku presiding at the Supreme Court, he will win through. He is intending to use the same argument that he used on the land reform exercise: that this was a project to correct historical imbalances in the way Zimbabweans benefit from their own natural resources and it can not, therefore, be a matter that anyone can appeal on to the courts.

Chidyausiku was brought in by Mugabe after former Chief Justice Anthony Gubbay was hounded out of his chambers, told by Mugabe's government that "hi safety can not be guaranteed" and led by the nose to sign his own resignation letter (Mugabe could not fire him even if he had tried, we still have a nominal independent judiciary that he prefers to control discreetly than be actively seen to be weeding out independent-thinking judges).

On the upside, though, even ACR acknowledge that the environment in Zimbabwe has now improved dramatically and will continue to do so.

What they are referring to, of course, is not the general standards of living of ordinary Zimbabweans, which remains parlous. Instead, they speak of the fact that, previously, they could not even dream of exploiting their diamond claims because of the unpredictability of the Zimbabwe dollar as well as policies that did not allow them to sell directly outside the country.

They had to go through the Reserve Bank, which could raid their accounts any time and tell them to go and complain to someone who cared if they protested.

Now, they can put their funds into their own accounts, there is no requirement for "retention", there is no need to account for every penny that they will want to withdraw to buy equipment and for other capital expenditure.

It is just that, now that things have changed, they are not allowed to mine their own diamond claims any more!

Good luck, then, to ACR, on their court cases!