Zimbabwe’s government-controlled diamond miner has launched a retrenchment exercise to avert collapse following a brutal global price crash that has rocked the gems industry, the Zimbabwe Independent can reveal.
Internal documents show the Zimbabwe Consolidated Diamond Company (ZCDC) has begun laying off workers to stay afloat — barely a decade after authorities injected US$80 million to build an institution meant to help the country ride out economic turbulence.
ZCDC was created after seven privately controlled miners were expelled from the world-famous Marange diamond fields in 2016, amid allegations of industrial-scale looting.
In an interview with the Independent, a ZCDC spokesperson confirmed the sweeping job cuts, saying the company had to make hard choices between keeping the affected workers — reportedly around 200 — or allowing a strategic state enterprise to crumble under the weight of falling revenues.
“Diamond prices have gone down on the market,” the spokesperson said.
“The company had to choose between closing and maintaining operations at a reduced rate whilst awaiting price recovery,” he added.
Global market prices for natural diamonds have plunged by 26% since 2022, while synthetic, lab-grown alternatives — now flooding jewellery markets — are retailing at 74% less than their 2020 prices, industry data showed.
This trend, which has hit several mineral markets, has been partly driven by geopolitical tensions since 2022. On the diamonds front, a global supply glut has severely undermined demand.
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Industry giant De Beers — listed on the Johannesburg Stock Exchange — disclosed in December that it was holding an unsold stockpile worth US$2 billion, illustrating the extent of the industry-wide meltdown.
By year-end, De Beers had slashed output by 20%, and its parent company, Anglo American, moved to sell off the historic diamond unit.
ZCDC is one of a few state-owned entities still propping up government finances amid intense economic headwinds, and troubles at its operations may signal problems for government.
Documents seen by the Independent said retrenched workers have been ordered off ZCDC’s Chiadzwa operations.
“Today's meeting was about notification of employees who have been identified for involuntary retrenchment,” a memo from management written two weeks ago said.
“The identified employees will be served with notification letters today that they will sign. These employees will leave the ZCDC premises…reason being the nature of our core business, as well as trying to avoid incidents and injuries.” But the move has already provoked outrage.
Workers interviewed by the Independent accused ZCDC of unfair practices.
“The decision to retrench employees has been marred by unfair practices, prioritising workers from distant towns (to stay) while local employees, who have been the backbone of this company, face unjust dismissal,” employees said.
“Close to 200 local employees have been retrenched. Local workers have invested their time and efforts into the company. They have also contributed significantly to the local economy,” one worker added.
ZCDC was born out of a sweeping government overhaul in 2016, which saw the closure of all private diamond operations over allegations they had looted what the late former President Robert Mugabe estimated at US$14 billion worth of gems. The new state entity inherited equipment from the expelled firms and launched operations with a generous capital injection.
Yet the firm has also faced troubles.
As revealed by the Independent in July 2024, ZCDC was fined US$1,73 million by tax authorities for failing to remit dues in 2022.
Auditors also flagged multiple compliance failures, including missed transfer pricing deadlines and chronic delays in VAT and income tax payments.
“The late payment of taxes during the year was mainly due to cash-flow challenges, which the company faced in 2022,” management said in its response to the findings.
ZCDC’s struggles reflect broader distress across Zimbabwe’s mining sector.
According to the Chamber of Mines of Zimbabwe (CoMZ) 1 216 jobs were lost in 2024, a fourfold increase from the previous year.
At the CoMZ annual conference in Victoria Falls this May, the industry body said:
“As at December 31, 2024, records showed that at least 49 160 workers were employed in the mining industry, with a vast, but unknown number of unregistered small workers also operating largely in gold mining.”
A total of 69 mines retrenched employees in 2024 — up from 42 in 2023 — as skyrocketing costs and poor earnings battered firms across the board. While gold, platinum group metals and chrome recorded increased production in 2024 — pushing total mineral exports up 9% to US$5,9 billion — diamonds bucked the trend.
Industry data shows the average price of a one-carat natural diamond plunged from over US$6 000 in 2022 to under US$4 500 in 2024.
Younger buyers in the US and Asia are now gravitating toward cheaper, environmentally friendly lab-grown alternatives — a shift that may permanently reshape the industry.
