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Zimbabwe Auctioning Marange Diamonds

Zimbabwe is trying new ways to generate income from diamonds, planning to auction more than 300,000 carats of goods Thursday, local media reported. The diamonds were mined at the Marange diamond fields, which has been the center of a brutal government crackdown that has claimed the lives of some 200 villagers.

The Mbanda Diamonds Mining, which holds a license to mine diamonds in Chiadzwa, will hold a three day auction at the recently converted diamond processing facility at the Harare International Airport.

The auction is the first of two such selling opportunities, the next one will be held next week, according to Mbada chairman Robert Mhlanga.

The Zimbabwean government will receive the bulk of the proceeds - a 50 percent weekly dividend, a 10 percent royalty fee, a 15 percent tax and a five percent resource depletion fee.

Mbada Diamonds has fenced a 1,000 hectares area in Marange, building a water infrastructure, housing and an airstrip at the mining concession.

In 2008, the government drove off African Consolidated Resources (ACR), which was licensed to explore and mine in the Marange area and illegal miners started to dig for diamonds. Fearing the loss of revenue, Zimbabwe's government sent troops to the region, which violently drove off the miners and subsequently forced local villagers to mine on behalf of the army.

Villagers are now facing relocation. According to Mhlanga, Mbada is currently in the midst of constructing a housing project for relocated families from Chiadzwa and Marange areas.