Zimbabwe's diamond conference was rocked by controversy Tuesday over the Kimberley Process, the world diamond trade regulatory body, whose chairwoman was publicly asked to resign because she is American.
Gillian Milovanovic, the American chairwoman of the Kimberley Process, came under a barrage of criticism from African delegates at the Zimbabwe Diamond Conference for allegedly not doing enough to persuade the U.S. government to lift trade restrictions on Zimbabwe's state-owned diamond mining companies.
South Africa's Kimberley Process monitor Abbey Chikane accused Milovanovic of having a conflict of interest because she is American. Chikane alleged Milovanovic has failed to follow African delegates wishes to promote the trade of diamonds dug up from Zimbabwe's notorious Marange field in Europe and the United States.
The state-run Zimbabwe Mining Development Company and Minerals Marketing Corporation of Zimbabwe are on the U.S. sanctions list, because of evidence of the Mugabe government's state violence and human rights violations.
"There is a danger of having a chairmanship that will fragment the organization because you are conflicted ... you are then supposed to recuse yourself," Chikane said to Milovanovic in front of the conference.
"When South Africa takes over the chair next year we will solve these issues," said Chikane, who is chairman of the South African Diamond Board.
Zimbabwe Mines Minister Obert Mpofu told Milovanovic that most traders and investors at the conference, mostly of Indian and Arab origin, were "scared" of her presence at the conference, which was sponsored by President Robert Mugabe's government.
"They are coming to me whispering, scared that they will be heard by the Americans who will interfere with their accounts," Mpofu said. "But it will not stop us from what we are doing," he said, referring to Zimbabwe's diamond trade with India and Dubai, which has been criticized for alleged corruption through price fixing.
Other delegates from Africa, India, Israel and Dubai told Milovanovic that because of U.S sanctions against Zimbabwe, the Kimberley Process is unwittingly promoting the illicit trade of Zimbabwe diamonds and creating the same conflict diamonds it is trying to prevent from being traded.
Milovanovic told the delegates that she would not respond to their criticism.
"You are looking for something very dramatic from all this but you are not going to get it," she said. "I'm not a dramatic person by nature."
Milovanovic said her position on the Kimberley Process had no power to influence the U.S. imposition of sanctions against Zimbabwe.
The U.S Embassy said U.S. sanctions against Zimbabwe's state-owned mining companies are separate from the Kimberley Process. Michael Gonzalez, the political and economic officer at the embassy in Harare, said the American sanctions against Zimbabwe's mining companies have nothing to do with the Kimberley Process but are a bilateral issue. He said Washington has imposed sanctions because of its concerns over state violence.
Zimbabwe's "attorney general and security chiefs must start honoring the president's calls to end violence so the sanctions can be removed," said Gonzalez.
Mugabe's government staged the conference in the resort city of Victoria Falls to gain international credibility for Zimbabwe's huge production of diamonds in the Marange fields in eastern Zimbabwe. But the Mugabe government's efforts to win respectability have been overshadowed by allegations that $2 billion of diamond proceeds have been stolen by Mugabe's cronies. Zimbabwe government officials denied the charges of corruption in the report by the Partnership Africa Canada, a group campaigning against conflict diamonds.
Since 2006, Zimbabwe has mined Marange — one of the world's largest diamond deposits — producing rough stones worth an estimated $2 billion per year. Yet the report charges that the funds have not reached the Zimbabwean treasury to help the impoverished country. Instead the diamonds have enriched Mugabe's close associates and an international ring of traders, according to the report.