Diamond deal signed, sealed and delivered

THE diamond sales agreement between Government and diamond giant De Beers has finally been signed and has been extended to 2013.

The Namibian diamond industry hopes the revised deal will bring benefits to their businesses and Namibia’s economic development. The agreement, signed between the Minister of Mines and Energy Erkki Nghimtina and De Beers Group Chairman Nicky Oppenheimer at a hotel in Windhoek yesterday, will also usher in a new company – the Namibia Diamond Trading Company (NDTC).Nghimtina announced that 16 per cent of Namdeb’s production would be supplied directly to local cutting and polishing companies, and the NDTC would handle the sorting, valuing, selling and marketing of diamonds from Namdeb – a 50-50 venture between Government and De Beers.Namdeb produced two million carats of diamonds last year, and the company aims at 2,8 million carats per year from 2010.Sixteen per cent of two million would translate to 320 000 carats a year for the Namibian market.Expectations are that the level of turnover from the Namibian diamond beneficiation industry could reach up to N$2 billion by 2009.THE NDTC Although exact details of NDTC’s operations could not be given yet, it was made clear that a board of directors was being selected and more would be revealed once they had been appointed.Gem dealers who attended the signing ceremony told The Namibian that this new company was a welcome move which would see much-needed development in the local diamond industry and value addition to local gems for export.It would also boost economic development through job creation.There were, however, reservations among some about the lack of information on NDTC’s operations.Kombadayedu Kapwanga, the Chief Executive Officer of LLD Diamonds Namibia – Africa’s biggest diamond cutting and polishing plant – said although directly supplying companies like his with diamonds was a ‘step in the right direction’ some questions were still unanswered.He said it was not yet clear whether local companies would get 16 per cent of Namdeb’s entire production or whether it was 16 per cent of ‘cuttables’ only – that is gems larger than 1,25 carats.Another important issue, according to Kapwanga, was that of prices.He said local companies still had to be told the price at which they would purchase the stones from NDTC.He said that costs would determine the viability of the whole process.In the past LLD has complained of struggling to find enough diamonds to polish at the Windhoek-based factory.Local economist Robin Sherbourne could also not comment much on whether the local industry would benefit.He felt it was first necessary to understand the full operations of the NDTC and the new process.”It seems like a step forward towards diamond cutting and polishing, value addition and branding of Namibian diamonds, ” he said.NEW PLAYER A new player on the scene, Trau Bros Namibia, which also specialises in cutting and polishing, welcomed the new agreement saying the company wanted to be part of Namibia’s economic development and was excited about working on Namibian gems which would be marketed internationally.Trau Bros, a Belgian company, has been in the business for more than a century and has international operations in places like New York, London, Antwerp, Monaco and the United Arab Emirates.Trau Bros Namibia is a subsidiary of the Belgian-based international firm and is to start operations by March 1 at its factory in Windhoek’s Northern Industrial Area.The head of the Namibian operations, Alain Petrfreund, said: “We chose Namibia to be our African hub as it is a safe environment.”Addressing the gathering at the signing, Nghimtina summed it up by saying: “For the local factories and the diamond industry in general, the opportunities available under this new arrangement can only be beneficial if we commit ourselves to hard work and reinvesting our returns into infrastructure and technical skills of our labour force to ensure that our businesses become success stories.”The agreement, signed between the Minister of Mines and Energy Erkki Nghimtina and De Beers Group Chairman Nicky Oppenheimer at a hotel in Windhoek yesterday, will also usher in a new company – the Namibia Diamond Trading Company (NDTC).Nghimtina announced that 16 per cent of Namdeb’s production would be supplied directly to local cutting and polishing companies, and the NDTC would handle the sorting, valuing, selling and marketing of diamonds from Namdeb – a 50-50 venture between Government and De Beers.Namdeb produced two million carats of diamonds last year, and the company aims at 2,8 million carats per year from 2010.Sixteen per cent of two million would translate to 320 000 carats a year for the Namibian market.Expectations are that the level of turnover from the Namibian diamond beneficiation industry could reach up to N$2 billion by 2009. THE NDTC Although exact details of NDTC’s operations could not be given yet, it was made clear that a board of directors was being selected and more would be revealed once they had been appointed. Gem dealers who attended the signing ceremony told The Namibian that this new company was a welcome move which would see much-needed development in the local diamond industry and value addition to local gems for export.It would also boost economic development through job creation.There were, however, reservations among some about the lack of information on NDTC’s operations.Kombadayedu Kapwanga, the Chief Executive Officer of LLD Diamonds Namibia – Africa’s biggest diamond cutting and polishing plant – said although directly supplying companies like his with diamonds was a ‘step in the right direction’ some questions were still unanswered.He said it was not yet clear whether local companies would get 16 per cent of Namdeb’s entire production or whether it was 16 per cent of ‘cuttables’ only – that is gems larger than 1,25 carats.Another important issue, according to Kapwanga, was that of prices.He said local companies still had to be told the price at which they would purchase the stones from NDTC.He said that costs would determine the viability of the whole process.In the past LLD has complained of struggling to find enough diamonds to polish at the Windhoek-based factory.Local economist Robin Sherbourne could also not comment much on whether the local industry would benefit.He felt it was first necessary to understand the full operations of the NDTC and the new process.”It seems like a step forward towards diamond cutting and polishing, value addition and branding of Namibian diamonds, ” he said.NEW PLAYER A new player on the scene, Trau Bros Namibia, which also specialises in cutting and polishing, welcomed the new agreement saying the company wanted to be part of Namibia’s economic development and was excited about working on Namibian gems which would be marketed internationally.Trau Bros, a Belgian company, has been in the business for more than a century and has international operations in places like New York, London, Antwerp, Monaco and the United Arab Emirates.Trau Bros Namibia is a subsidiary of the Belgian-based international firm and is to start operations by March 1 at its factory in Windhoek’s Northern Industrial Area.The head of the Namibian operations, Alain Petrfreund, said: “We chose Namibia to be our African hub as it is a safe environment.”Addressing the gathering at the signing, Nghimtina summed it up by saying: “For the local factories and the diamond industry in general, the opportunities available under this new arrangement can only be beneficial if we commit ourselves to hard work and reinvesting our returns into infrastructure and technical skills of our labour force to ensure that our businesses become success stories.”