WINDHOEK – Namibia Diamond Trading Company, the Namibian government’s joint venture diamond sorting and trading company with De Beers, will by the end of this year call for the application of new ‘sight holders’ – the select group of diamond companies that would receive preference to buy Namibia’s rough diamonds in bulk.
The much revered ‘sight holder’ status is a long-term contract of about three years that the Namibia Diamond Trading Company (NDTC) give to a select few diamond polishing and cutting firms, who would on a regular basis be invited to buy freshly mined rough gems to cut and polish in the country.
This would be the third call for the supply contracts since the establishment of the NDTC in 2007. The current supply contracts end in March 2015, and NDTC Chief Executive Officer, Shihaleni Ndjaba, says the process to call for new applications for new supply contracts would start towards the end of the year. For now though Ndjaba says it is too early for NDTC to say how many sight holders it would eventually contract. “We have to determine [that when we look at] the applications we will receive and at the forecast of the rough diamonds that would be available [from mining],” he said.
The selection has in the past attracted criticism from both the unsuccessful diamond cutting firms in the country, as well as from the government unhappy with the successful diamond cutting firms who, it has been alleged, instead of cutting and polishing the diamonds locally as intended, ship the quality rough gems outside Namibian borders, while cutting and polishing inferior gems from outside. “We only consider reputable companies and reputable individuals,” said NDTC Manager for Sales and Marketing, Richard Steenkamp.
NDTC yesterday invited New Era Publication Corporation’s Chief Executive Officer, Dr Audrin Mathe, Chief Commercial Officer Roy Klaasen, as well as Chief Financial Officer Immanuel Awene to visit the NDTC diamond sorting and valuation operation at the Windhoek office.
Ndjaba, explained that besides being compelled to involve local shareholders, sight holders are also tasked with creating Namibian brands during the value addition process of the diamonds. These brands are then marketed locally and internationally.
The purpose of NDTC is to make diamonds available for sale in Namibia for local manufacturing, in order to create local Namibian brands and support the government’s efforts of job creation and value addition from its diamond resources. Sight holders purchase the authorized diamonds from the NDTC, which sorts and values the stones, to add value by cutting and polishing the gems for the retail market. Steenkamp explained that while some local cutting and polishing factories criticise NDTC’s stringent requirements, requirements are much more stringent internationally. Previous criteria included the requirement that an applicant should have had a turnover of US$15 million in the previous financial year and should have purchased US$5 million worth of rough diamonds during the previous year. In January 2007 the Namibian government and De Beers signed a diamond sorting, valuing and marketing agreement. Under the agreement, Namdeb’s production in Namibia would be sold through the DTC until 2013. The agreement included the formation of NDTC, a 50/50 joint venture between the government and De Beers, to recognise and formalise the two shareholders’ efforts to develop a sustainable local downstream diamond industry in Namibia. NDTC, which employs a 100 percent Namibian staff, sorts and values in excess of one million carats annually, and incorporates state-of-the-art sorting equipment designed and manufactured by De Beers UK. Namdeb Holding’s production is sorted and valued at NDTC before bit is exported to De Beers UK for aggregation. Ten percent in the value of Namibian diamonds is sold to local sight holders. Once aggregated, a mix of diamonds is then returned to NDTC to be sold locally.
NDTC is the primary vehicle for growing the diamond manufacturing industry in Namibia and is driving the creation of a sustainable downstream diamond industry in the country. This they do by providing maximum long-term value from diamonds through world-class sorting, valuing and sales practices in Namibia and maintaining and developing employment opportunities and broadening the local skills base in Namibia. “These ‘rough’ precious stones enter a series of processes or the ‘diamond pipeline’ in which the NDTC plays a pivotal role in determining their value,” explained Ndjaba.
By Edgar Brandt