Wednesday, April 24, 2024

Jubilation over songs of “mine to finger”

Botswana is to add to its strong position of being the largest diamond producing country to a multi-faceted, sorting, marketing, aggregating, cutting and manufacturing country starting from Tuesday this week.

The new move will break the 350 years of London’s dominance on the aggregation, distribution and marketing of diamonds across the world.

“This could herald a new era in the whole of the diamonds and commodities markets. It will mean that a lot of volume of activity from all the De Beers diamonds from Canada, Namibia and South Africa will be aggregated here,” De Beers Botswana’s
Head and a board member of DTC Botswana, Sheila Khama, said in an exclusive interview with The Sunday Standard.
The new sea-change will mean that Botswana will start selling diamond to the value of US $ 370 million from April this year, which will increase to US $ 5.500 million by next year.

But the plan has severely been criticized by the billionaire diamond magnate, Lev Leviv, who rubbished diamond beneficiation as “a ploy aimed at punishing the Jews who belong to the Holy Land of milk and honey.”

However, he has been joined by the more cautious Indian cutting and polishers who say with the rough diamond spike, which has already cost them 150, 000 jobs, it is likely to add another tool of 100,000 out of a work force which was around 700, 000.

The new developments are expected to contribute close to three percent of Botswana’s Gross Domestic Products (GDP) out of the selling of rough alone, but the figure will edge up if government taxes and value of polished goods is to be taken into consideration.
“Add value of polished, the contribution will be higher,” she said, adding that “that shows that we are moving from being a centre of mining into a centre of sorting world-wide.”

However, the new twist will mean Botswana will have to compete with other established centers, such as Antwerp and Ramat Gan, Dubai, New York and Mumbai, which have a lot of history in cutting, polishing and jewellery manufacturing behind them. The oldest will be the private sector friendly nations, such as Antwerp, Dubai and Ramat Gan and some of the major centers across the world.
“In 2011, the 16 factories will have to be re-evaluated in terms of the quality of goods and the business plan. In that valuation, there has to be 60 percent of the government’s aspiration,” Khama added.

The new developments will leave 17 Chatham Street in Central London solely to deal with clients’ relations, financial affairs and technological development of De Beers as the diamond leading miner in the world. De Beers has scaled-down its dominance from 90 to 40 percent of the world’s diamond control but Alrosa, a Russian government’s sponsored outfit, is likely to take over the mantle if De Beers does not find many huge deposits, such as Orapa and Jwaneng, in the near future. Last month, the Alrosa Chief Executive told the Israeli Rough Diamond Conference that it still has rich reserves that would last for another 45 years.
“We have to ensure that the manufacturers do get the economically cuttable goods here and how much can we cut here?” she asked.

“If the producer country succeeds, then the whole industry will succeed. But we have to dig in our heels and that means that the whole industry is going to benefit,” she said.


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