AllAfrica.com, Africa
March 24 2005

Nam Diamonds Aplenty, But Few to Polish

New Era (Windhoek)
March 24, 2005
Posted to the web March 24, 2005

Catherine Sasman
Windhoek

Israeli-based LLD Diamonds Namibia appointed its first Namibian
managing director, Kombadayedu Kapwanga, on 21 March, and he will
take over the reins of the local company from Yaaqov Adir.

The company, which is currently the biggest diamond cutting and
polishing factory in Africa, complained that it at times finds it
difficult to buy Namibian diamonds for value addition. It is
currently the only cutting and polishing plant that adds value to
Namibian diamonds, which it buys from the Samicor marine diamonds
ploughed from along the coastline. Namdeb’s cutting and polishing
factories get their diamonds from the London open market.

The company, which is currently challenging Namdeb’s monopoly in
diamond mining and cutting and polishing, is a subsidiary company of
the Leviev Group/Samicor.

While the Leviev Group holds 70% shareholding in Samicor, government
holds 10%, 10% by various black economic empowerment groups, and 4%
by Samicor employees. The Leviev Group, however, wholly owns LLD
Diamonds, putting in N$100 million investment into the company over a
period of 10 months.

The LLD factory started its operations in June last year with 250
trainees. It currently has 430 trainees, whose training programme
will come to an end shortly. The company thus anticipates starting
with production soon thereafter. It has its markets in Japan, the USA
and Europe, with seven marketing agents globally. The factory was
designed to employ up to 550 people. The Leviev Group has deployed 67
Armenian trainers to oversee this training.

“The localisation of managing the company will mean that management
will know more about the local employment and environmental
conditions,” said Kapwanga from his office yesterday.

Kapwanga said that the factory has resulted in a spin-off effect in
the SADC region, where countries like Botswana, South Africa and
Angola are considering opening their own cutting and polishing
plants. Currently, there are already 27 Angolans trainers and 40
trainees being trained at the Wind-hoek factory.

The LLD Diamonds Namibia company has been given a diamond cutting
licence as per the Diamond Act, and Samicor given a number of
prospecting and mining licences. Equally, Namdeb has an exclusive
prospecting and mining rights, as well as a cutting licence under
Namgem.

“It is time that we do value addition to our diamond products instead
of exporting our raw materials,” said Kapwanga, adding that where the
company falls short in supplies of Namibian diamonds for its factory,
it is forced to buy diamonds from the Leviev Group factories in
Russia or from the Katoma diamond mine in Angola.

“Why do we have to settle importing from Russia and Angola while
Namibian diamonds, the best in the world, are exported to the UK?”
questioned Kapwanga.

The Ministry of Mines and Energy, in response, pointed out that the
government has “an agenda”, whose roots are growing and stabilising,
to maximise revenue from diamonds, in addition to value addition and
manufacturing. “In fact, government policy and a pro-active
legislation were the catalysts for the creation of Samicor and the
coming to Namibia of LLD Diamonds,” the ministry pointed out. This,
the ministry stated, is “unheard of in some of our neighbouring
countries that produce many more carats, been independent for many
more years and are now trying to emulate Namibia”.

The ministry stated that the Namdeb licenses are protected as per
agreements between its shareholders – the government and De Beers.
More, the Namibian laws protect the licenses, as well.

“In the near future, the government shall enter into negotiations
with its partners on a myriad of issues. It would therefore be unfair
and prejudicial to government, at this critical juncture, to be
coerced to prematurely tip its hand and disclose issues that would be
thrashed out at the negotiating table,” the ministry responded when
asked what plans the government has in mind to maximise value
addition in the country, and how much the country is losing out for
exporting its rough diamonds to the Central Selling Organisation.

“The government has plans that it is busy fine-tuning. These plans
would be finalised once the new government sits comfortably in its
place, and once the new Minister Erkki Nghimtima is fully briefed and
has sufficiently acquainted himself with the issues and the industry.
When the time comes the industry and the nation will be informed of
results and developments.”

From: Emil Lazarian | Ararat NewsPress