By: Nghiinomenwa-vali Hangala
Beyond the turbulent global diamond markets, the Namibian diamond cutting and polishing industry is facing policy uncertainty, particularly in relation to transitioning from the current Export Processing Zone (EPZ) regime to the Special Economic Zone (SEZ) regime.
This is according to the Namibia Diamond Trading Company (NDTC), which sells raw diamonds to the sightholders (processing companies).
Speaking at the inauguration of Ankit Gems Namibia’s new diamond processing factory, NDTC chief executive officer, Brent Eiseb, said the diamond beneficiation sector faces challenges that need urgent attention.
“The country’s diamond cutting and polishing industry faces significant challenges that, if not addressed adequately and timeously, have the potential to not only impact the long-term viability and sustainability of Namibia’s downstream beneficiation industry,” he stated.
Adding that if actions are taken, the current issues “could severely hamper our ability to unlock further opportunities in the diamond beneficiation space.”
Eiseb revealed that the biggest challenge the diamond downstream sector faces is the uncertainty regarding what will happen after the EPZ Act is repealed, before the implementation of the new policy.
He said in the absence of a clear transition mechanism or strategy, the policy vacuum would likely result in increased production costs, as the benefits under the EPZ regime would automatically fall away.
“Not only will this impact Namibia’s competitiveness as a diamond cutting centre relative to regional centres such as Botswana and South Africa, it will likely lead to downsizing, or worse-case, factory closures that will threaten hundreds of jobs in the Namibian cutting and polishing industry,” Eiseb explained.
The EPZ regime, established under the Export Processing Zone Act, has been a cornerstone of Namibia’s export-oriented industrialisation strategy, and it has mostly enabled Namibian diamond cutting and polishing companies.
For the period 2023 to date, NDTC has revealed that its sightholders have purchased approximately N$13 billion of rough diamonds from NDTC for value addition purposes.
While the latest rough diamond import and export data shows approximately 88% of the rough diamond carats the NDTC sold to its sightholders have been processed in Namibia.
Furthermore, the combined annual export value of polished diamonds from the Namibian cutting and polishing factories exceeded N$5 billion, contributing around 2% of Namibia’s GDP and an estimated 8% of manufactured exports.
The diamond downstream sector has created close to 1,200 direct jobs in Namibia’s cutting and polishing industry, according to NDTC statistics.
Furthermore, the industry supports over 3,000 indirect jobs through ancillary services such as security, logistics, catering, transport, and equipment maintenance.
In the same period (from 2023 to date), diamond sightholders have invested over N$530 million in infrastructure and technology in Namibia, shows the NDTC summary.
According to Eiseb, continuous investments are critical because they improve the competitiveness of the country’s cutting and polishing industry and also highlight the confidence that investors have in the Namibian diamond industry.
Ankit Gems Namibia Diamond Cutting and Polishing Factory employs over 150 employees with the new plant, with the company set to double that number to 300. erastus@thevillager.com.na
