HARARE (Commodity Online): Zimbabwe’s dubious distinction as a source of blood diamonds has again come under scrutiny and the country is now facing trouble as far as diamond companies are concerned.

Some private diamond firms have already started banning the country’s diamonds.

Zimbabwe got the taste of the things to come when a major diamond firm, Rapaport Group, banned all diamonds from Zimbabwe’s Marange fields because of severe and continued human rights violations.

However, the government said security troops are being withdrawn from diamond fields they have occupied after the beleaguered government was threatened with expulsion from the global diamond market.

Rapnet diamond trading network also called on other major diamond manufacturing and trading bodies to do the same.

The withdrawal was demanded by the Kimberly Process, a global watchdog established in 2003 to monitor the trade in so-called conflict diamonds that armed groups involved in Africa's perpetual wars use to buy weapons.

Without the certification of that organization, which is supported by 70 diamond-producing countries, Zimbabwe, driven to bankruptcy by President Robert Mugabe’s excesses, would not be allowed to deal in diamonds on the international market.

Kimberly investigators have accused the Zimbabwe military of running illegal syndicates that smuggle Marange diamonds into Mozambique.

Kimberly gave Mugabe until June 2010 to introduce reforms to comply with global regulations, despite the recommendation of its own investigators that Harare should be suspended for six months.

Mugabe, the guerrilla hero who drove out the ruling white minority from the former British colony of Rhodesia in the 1970s to become president in 1980, needed the funds from illegal diamond sales to buy the loyalty of his 25,000-strong army to stay in power.

In June, Human Rights Watch accused Zimbabwe’s military of using revenues from illicit diamond sales, smuggled out or illegally sold through the Reserve Bank.