South Africa Diamond Trader Seeks More Supply for Local Cuttersby
State should force producers to make more stones available
Country wants more raw materials processed locally for jobs
South Africa’s state-owned diamond-trading company said the government should force mining companies to avail a higher portion of their stones for cutting and polishing inside the country.
Local cutters and polishers don’t have sufficient opportunity to buy the range and volume of stones they need for local manufacturing, Dolly Mokgatle, chairwoman of State Diamond Trader, said at a conference in Johannesburg. Producers in South Africa, such as Anglo American Plc’s De Beers unit and Petra Diamonds Ltd., are already required by law to sell as much as 10 percent of their stones to the SDT.
“The tightening of any loophole which allow companies to remove vast amounts of diamonds from the country may be something to consider,” she said. “Export laws should be in place and implemented.”
South Africa, the world’s largest producer of platinum and chrome, is seeking ways to process more commodities locally to promote the development of new industries in a country where more than one in four is unemployed. The profits of miners have come under pressure as prices of rough diamonds that miners sell to cutters have fallen 17 percent this year.
The number of diamond cutters and polishers employed in South Africa has dropped to 200 from a high of more than 4,000, Ernst Blom, president of the World Federation of Diamond Bourses, said at the conference. South African legislation doesn’t provide tax or employment incentives for cutters and polishers such as those enjoyed by major centers such as Dubai, India and Israel, Blom said.
“We find ourselves struggling to find an economic model that can justify diamond cutting and polishing at home,” he said.