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Africa Vera
Brian MacGarry
Gesuita dello Zimbabwe
1 per cent makes a big difference

Two diamond-producing countries offer contrasting ways of dealing with powerful multinational companies.

Botswana was pitifully poor when it became independent and for some ten years after that. Then they discovered large deposits of diamonds. Its government had followed the best kind of conservative economic policies, the most important part of which was avoiding falling deep into debt, so they were well prepared to make good use of their new wealth.

But first, to maximise income from the mines, they made a deal with De Beers, the company who controls the legal worldwide market in diamonds. They wanted De Beers' expertise and were ready to give them a share of the profits, but they did not want to be dominated by them. They set up a mining company in which De Beers and the Botswana government each held 50% of the shares.

When you are dealing
with a company as big as De Beers, you need to negotiate both cautiously and shrewdly. Botswana's leaders succeeded in doing this, so that in reality, and not just on paper, neither party could overrule the other. That meant that both had to make compromises, but Botswana has gained a lot from this arrangement. It can now afford an independent Press and radio stations, freeedom for opposition politicians to campaign on radio and Tv at election times and freedoms for ordinary citizens which they did not allow in the early years of independence.

Botswana now has one of the highest per capita Gdps in Africa and, although the gap between the incomes of the rich and poor is still wide, extensive free social services, especially medical, educational and the food relief that is so often needed in a drought-prone country spread the benefits of diamond wealth.

Neighbouring Zimbabwe
discovered large diamond deposits much more recently, when Mugabe's Zanu-Pf party was conducting a noisy and often violent campaign to «indigenise» foreign-owned businesses, though chinese and nigerians are not considered foreign. All businesses must be at least 51% locally-owned.

Zanu-Pf have always shown that if they control 51% of anything, they believe this gives them the right to ignore the wishes of the other 49%. As a result, for years there has been negligible investment in a country that was 30 years ago, second only to South Africa in industrial development. Now Zimbabwe is one of Africa's six poorest countries, depending on imports of food and even of such simple products as matches. Their diamonds are sold at a discount and, since Zanu-Pf restored their sole control of government last July, government has received no revenue from the diamond mines. Nobody will risk their money by investing it in Zimbabwe and, whether we like it or not, development is very slow without some investment from outside.

So Mugabe remains ideologically pure, at least in his public pronouncements, while his country starves. Who would have thought demanding 1% more could make such a difference between two countries?