Diamond firms mull tie-up

via Diamond firms mull tie-up | The Herald 31 December 2014 by Conrad Mwanawashe

SATOMBO Mineral Age, a wholly owned indigenous diamond cutting and polishing company intends to partner mining companies in the value addition of rough diamonds following a $2 million investment in state-of-the-art processing equipment.

The company, which specialises in processing rough diamonds into faceted gems, says value addition of rough diamonds will result in the creation of employment in line with Government’s economic blueprint the Zimbabwe Agenda for Sustainable Social Economic Transformation. To spur beneficiation, the country reserved a minimum 10 percent quota of all rough diamond exports for local cutting and polishing.

Zimbabwe is currently one of the major producers of diamonds in the world.

However, most of the diamonds are exported in raw form, thus depriving the country of employment opportunities as well as potential revenue to the fiscus.

While appreciating the removal of royalties on rough diamonds sold to firms licensed to cut and polish diamonds with effect from January 2015, Satombo chief executive officer Mr Martin Mufanebadza urged Government to set up mechanisms to ensure locally owned companies access rough diamonds at zero cost in partnership with miners. “As locally owned companies, our resources are limited as we cannot access lines of credit and this affects our capacity to compete on tenders for rough diamonds,” said Mr Mufanebadza.

In the 2015 National Budget Statement, Finance and Economic Development Minister Patrick Chinamasa, said Government has also licensed three firms to undertake diamond cutting and polishing.

Although Government set aside 10 percent of rough diamonds mined in the country for local players, the price of the gems have been too high for indigenous companies. “We are proposing partnerships with diamond producers in an arrangement where we get diamonds at zero cost, value add and share the proceeds with the miners,” said Mr Mufanebadza.