Zim diamonds can fetch $400m: Antwerp

HARARE - Antwerp World Diamond Centre (AWDC) says Zimbabwe can earn over $400 million from its Marange diamonds annually, resulting in an increase of $60 million in royalties per year.

This comes as the country’s diamonds are selling at heavily-discounted prices of about $50 per carat compared to market highs of around $450.

The country has earned $80 million from 1,1 million-plus carats sold following resumption of diamond auctions, with about $10 million going to Treasury.

Ari Epstein, AWDC’s chief executive, last week told legislators at a ZimAsset seminar that Zimbabwe can generate tens of millions in additional revenues by tendering rough diamonds in Antwerp.

“Results from the recent tenders held in Antwerp have demonstrated the immense buying power and benefits the world’s leading diamond-trading platform has to offer.

Performance zoomed past expectations, as on average, the sales in Antwerp generated prices that were 30 percent above the producing companies’ expectations and an astonishing 50 to 60 percent higher than prices fetched in Zimbabwe and other diamond centres,” he said.

Epstein revealed that for the first time in four years, a transparent and appropriate return on investment for the government has been achieved.

Prior to trading in Antwerp, Marange goods were sold in Zimbabwe but also in other diamond centres, at an average price of $47 per carat, resulting in an average return on investment for the Zimbabwean treasury of $7,05 per carat.

“By contrast, Antwerp, due to its unparalleled critical mass of buyers, achieves an average price of $80 per carat, or $12 per carat in royalties for the Treasury.

‘If all sales were to go through Antwerp, Zimbabwe would gain more than $400 million in extra revenues, resulting in an increase of $60 million of royalties per year. Naturally, the total sum of money flowing back to Treasury would be exponential of this figure,” he said.

Since the European Union lifted sanctions on the Zimbabwe Mining Development Corporation (ZMDC) last year in September, the country has earned $80 million in two auction sales.

Later this month, Zimbabwe is expected to start selling its Marange diamonds to the hub of the diamond trade network in Dubai.

The Dubai Diamond Exchange has already confirmed that it will host its first rough diamond tender for diamonds from Zimbabwe at Almas Tower between March 23 and 30. 

However, in an apparent tussle for Zimbabwe’s gems, Epstein said he wants all the country’s diamonds to be sold only in Europe.

“We have created a break-through by opening up the market for Marange goods and creating real added value in a fully transparent manner. We are now willing and able to help Zimbabwe to develop further by sharing our expertise and knowledge on how the country can yield more benefits from its resources,” he said.

 

Comments (1)

Can somebody please explain to me how we end up getting 60 million USD from diamond sales of 400 million USD.

Roland Dube - 18 March 2014

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