Zimbabwe’s diamond mining industry has appealed for urgent government intervention, including sharp cuts in royalties and licensing fees, as plunging global diamond prices and rising operating costs threaten the viability of local producers.
The Chamber of Mines of Zimbabwe (CoMZ) has formally requested Treasury to reduce diamond royalties from the current 10% to as low as 2%, arguing that the sector can no longer sustain the existing fiscal framework amid worsening market conditions.
Speaking on behalf of the industry, CoMZ Chief Executive Officer Dr Isaac Kwesu said diamond producers have come under severe pressure following a dramatic decline in international prices, with average values reportedly falling from about US$72 per carat to US$22 per carat.
The downturn has already triggered significant operational challenges across the country’s major diamond producers.
Anjin Investments has suspended mining activities and placed its operations under care and maintenance, while grappling with wage obligations. Murowa Diamonds has scaled back production amid financial constraints and labour-related challenges. Meanwhile, state-owned Zimbabwe Consolidated Diamond Company (ZCDC) has approached Parliament seeking additional working capital support and fiscal relief measures.
To cushion the industry, miners are proposing the replacement of the flat royalty regime with a price-linked sliding-scale system that would allow royalties to decline during periods of weak market performance and increase when prices recover.
The Chamber argues that such a framework would help preserve production, protect jobs and improve the sector’s competitiveness against regional producers.
Beyond royalties, the industry is seeking substantial reductions in regulatory charges, including a review of annual registration fees for X-ray diamond sorting machines. Producers want the fee reduced from US$50,000 to US$10,000 per machine, saying the current cost structure is adding pressure to already strained operations.
Diamond miners have also called for changes to the foreign currency surrender requirements, arguing that the retention of a portion of export earnings in local currency limits access to the United States dollars needed to pay for imported equipment, consumables and electricity.
The industry’s difficulties come against the backdrop of a deepening global crisis in the natural diamond market. Analysts attribute the downturn to weakening demand in major consumer markets, rising inventories and growing competition from lab-grown diamonds, which have gained significant market share in recent years.
A slowdown in luxury spending in China and subdued demand in other key markets has further weighed on prices, leaving many producers around the world under financial strain.
The Chamber warns that without timely fiscal intervention, more mining operations could be forced to scale down production or suspend activities, with implications for employment, export earnings and government revenues.
While the Ministry of Mines and Mining Development has acknowledged receiving the industry’s submissions, government is yet to announce whether it will grant the requested concessions. The proposals are expected to feature prominently in discussions ahead of the 2027 National Budget. 
