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C O N F I D E N T I A L SECTION 01 OF 03 HARARE 000024 SIPDIS AF/S FOR B. WALCH DRL FOR N. WILETT ADDIS ABABA FOR USAU ADDIS ABABA FOR ACSS STATE PASS TO USAID FOR E. LOKEN AND L. DOBBINS STATE PASS TO NSC FOR SENIOR AFRICA DIRECTOR B. PITTMAN E.O. 12958: DECL: 01/09/2019 TAGS: PGOV, PREL, ASEC, PHUM, ECON, EMIN, RS, ZI SUBJECT: MILITARY EXPANSION FUELS DIAMOND CHAOS IN CHIADZWA REF: A. IIR 6 926 0058 09 B. 08 HARARE 1016 C. 08 HARARE 1035 Classified By: Ambassador James D. McGee for reason 1.4 (d) ------- SUMMARY ------- 1. (C) On January 7, poloff met with Newman Chiadzwa, the tribal chief of the Chiadzwa region that contains the diamond-rich Marange fields, to discuss violence in the region as well as recent developments in the turbulent Marange diamond trade. Chiadzwa described how the military expansion in Chiadzwa in late November has been displacing the police and diverting the diamond flow from the Reserve Bank of Zimbabwe to the Zimbabwean military. This has not deterred the continued brisk diamond trade involving foreign buyers, including most prominently the Lebanese. END SUMMARY. ------------------------------------ Shootings Continue as Bodies Pile Up ------------------------------------ 2. (C) The tribal chief of Chiadzwa, Newman Chiadzwa, met with poloff in Harare on January 7 and confirmed that military and police shootings in Marange are continuing, as security forces tighten their control over the diamond-rich area. This was seconded by a report we received from a human rights group in the region (REF A). According to the report, during police and military Operation Hakudzokwi, (Shona for "you won't come back") which was aimed at clearing individual panners from the area, over 200 bodies turned up at Mutare Provincial Hospital Mortuary, Old Mutare Mission Hospital, Sakubva District Hospital, and private mortuaries. Many of those bodies arrived with fatal gunshot or dog bite wounds and were tagged "BID Marange" or "brought in dead from Marange." 3. (C) Chiadzwa shared that his village is located only 200 meters from the diamond site and many of his people have been killed, beaten, and arrested for dealing in diamonds. The villagers had entrusted their diamond findings to Chiadzwa because he owned a safe and they thought his tribal status would be respected; however, the police forced him to turn over the village's diamond stash to the security forces. Chiadzwa is now in hiding in Harare. He also told us he had been harassed, arrested, and beaten after his nephew Shuah Mudiwa beat out ZANU-PF incumbent Christopher Mushohwe for the Mutare West parliament seat in March 2008. (NOTE: Mushohwe was subsequently appointed governor of Manicaland on August 25 and some sources have cited his anger towards the Mutare West constituency as a reason for the military expansion and campaign of violence in Chiadzwa. END NOTE.) ---------------------------------------- Military Expansion Displacing the Police ---------------------------------------- 4. (C) Chiadzwa confirmed that the military has increased its numbers in the region and now exceeds the police presence by a large margin. He suspected the increase stemmed from concern that the power-sharing negotiations between ZANU-PF and the MDC might culminate in the awarding of the Home HARARE 00000024 002 OF 003 Affairs ministry--which includes the police department--to the MDC. This would result in a tremendous loss of wealth and patronage that helps to maintain the Mugabe regime. Therefore, he believed that the military, which would remain under ZANU-PF control in the event of an agreement between the two parties, was seeking to consolidate its authority. 5. (C) Digging by panners, according to Chiadzwa, is continuing in Marange largely under the supervision of the military. The typical practice is for soldiers to supervise and escort groups of panners as they dig. Then at the end of the day, any diamonds found are apportioned between soldiers and diggers. Chiadzwa said that military helicopters fly in daily and transport many of the diamonds to bases near Harare, where presumably they are taken by senior military commanders. -------------------------------------- Gono May Have Been Cut Out of the Deal -------------------------------------- 6. (C) Prior to the military expansion in late November, it was well known by locals that Reserve Bank of Zimbabwe (RBZ) governor Gideon Gono had representatives in Mutare buying diamonds with bundles of freshly-printed Zimbabwean notes (Ref B). Chiadzwa claimed that the military has now barred Gono's operatives from the region and that diamonds are no longer being sent to the RBZ. All diamond purchases are now being conducted solely in foreign exchange. (NOTE: According to an article in the state-controlled newspaper, the Herald, Tendai Makurumidzi, a well-known Gono buyer who uses the alias "Gonyeti" was arrested sometime in November and had three of his vehicles seized. END NOTE.) Chiadzwa explained that it used to be common to see 4x4 vehicles leaving Chiadzwa, but now the roads have deteriorated to the point that access is only possible by foot or helicopter. Vehicular access to the greater area is also being controlled by police and military roadblocks, according to Chiadzwa. ----------------------- Foreign Buying Unabated ----------------------- 7. (C) While Gono's access to diamonds may have been compromised, Chiadzwa said that many diamonds are still being sold to foreign diamond buyers in Mutare and over the border in Mozambique by a mix of panners, police, and soldiers. In particular, Lebanese buyers have set up shop in large numbers in Mutare and typically pay for the diamonds with U.S. dollars. In order to operate safely, the Lebanese have formed profitable relationships with senior military and police officials in the region. Marginally more reputable buyers from Europe and other regions prefer to stay in Chimoio in Mozambique. Chimoio affords these buyers protection from Zimbabwean police and soldiers who commonly seize cash, diamonds, and vehicles from them in Mutare, but that safety is offset by higher diamond prices. ------- COMMENT ------- 8. (C) We previously reported on a meeting between Gono and the Russian diamond monopoly ALROSA (Ref C) in November. Recent press reports, corroborated by Embassy sources, HARARE 00000024 003 OF 003 indicate that Mugabe is planning a trip to Russia in January to discuss mining investment opportunities. With the GOZ desperate for forex, such a trip could involve discussion of a Chiadzwa diamond deal between Zimbabwe and Russia. END COMMENT. MCGEE