Zimbabwe to consolidate all diamond mining companies in the country

15 March 2015 (Last Updated March 15th, 2015 18:30)

Zimbabwe has announced plans to consolidate all diamond mining companies, including Rio Tinto's Murowa diamond mine.

Zimbabwe has announced plans to consolidate all diamond mining companies, including Rio Tinto's Murowa diamond mine.

Zimbabwe Mines Minister Walter Chidhakwa told Reuters that the companies will be merged into one big firm, which the state will own 50% of the shares in.

Chidhakwa said: "We are very clear, this is a regulatory matter and we have said to them the only way you can participate in diamond mining in Zimbabwe is by being in this company."

"This is a regulatory matter and we have said to them the only way you can participate in diamond mining in Zimbabwe is by being in this company."

The Murowa mine, which is 78% owned by Rio Tinto, increased diamond output by 7% in 2014 to 344,000 carats.

According to Chidhakwa, companies that did not wish to merge would be given compensation and allowed to leave.

President Robert Mugabe's government is pursuing indigenisation, a black economic empowerment programme that requires foreign-owned companies, including mines, to sell 51% of their shares to Zimbabweans.

The government previously said it aims to improve transparency, which included plans to consolidate some of the diamond companies that are operating in the Marange area to the east of the southern African country.

The minister told a parliamentary portfolio committee that the new entity would include seven miners in Marange.

He added that he already advised all diamond mining companies of the position.