Johannesburg - One of the major criticisms of the mining and resources sector in Africa over the years has been that it simply extracts resources without benefiting the countries in which it operates.
According to the De Beers Group beneficiation manager, Kagiso Fredericks, the key to unlocking a sustainable future for the diamond industry lies in one word: beneficiation.
He said beneficiation was a process that improves the economic value of the rough diamonds mined, which included cutting and polishing diamonds, jewellery manufacturing, marketing and distribution.
"There are a couple of reasons why developing a bigger local beneficiation industry is important."
For one, South Africa’s economy benefits from keeping more of the downstream value-generating activity around mining diamonds in the country.
"Local beneficiation allows communities and broader society to benefit directly from the diamonds that are mined in their own backyards, and it is a driver for the empowerment of historically disadvantaged South Africans because it enables the development of new entrepreneurs in downstream and sidestream industries.
"Accessing the industry is not easy as it is a highly regulated industry, and for small businesses to succeed as benefactors, they need help with access to funding, business strategy, and networking opportunities as much as they need access to smaller, more affordable parcels of rough diamonds."
Fredericks said a year ago that De Beers and several key industry players, including the SA diamond and precious metals regulator, the SA Diamond Manufacturers Association, the SA Diamond Dealers Club and the State Diamond Trader, partnered to launch a small beneficiation customers (SBC) pilot programme with seven identified businesses in need of assistance.
"The objective of this programme was to broaden the supply and access of rough diamonds to small South African-owned beneficiation companies.
"The pilot project has proved to be extremely productive, with the company now rolling out the project as a regular programme.
"South Africa is a rich source of rough diamonds, and aside from helping to up-skill the industry, it is important for us as diamond producers to afford small beneficiation customers access to affordable parcels of rough diamonds."
He added that to help emerging businesses access affordable rough diamond parcels, De Beers is offering SBCs parcels of diamonds consisting of a mix of diamonds from its mines in Namibia, Botswana, Canada and South Africa.
"It’s also helping these small businesses gain access to international markets, and although Africa is a top producer of diamonds, the US market accounts for half of global consumption, followed by China and India. South Africa only consumes small amounts of beneficiated products.
"To help SBCs gain access to markets, De Beers Group has created a series of exhibitions to give participants in the Enterprise Development Programme and alumni from Shining Light Awards the opportunity to sell their diamond products.
"De Beers’ partnership with the State Diamond Trader takes local businesses to exhibitions such as the Jewellery & Gem World, the world’s biggest B2B buying event, and the Jewellery Council of SA exhibition, ShopJewellex," said Fredericks.
The Star