De Beers targets Angola’s reformed diamond sector

ANGOLA – World’s largest diamond producer De Beers Group, has applied to conduct exploration activities in north-eastern Angola following substantive and consistent reforms implemented by the country’s government that enable the country’s diamond endowment to “underpin transformative socioeconomic growth for local communities”.

Following the mineral rights application submission, De Beers and the government of Angola will open discussions in an effort to agree to a mineral investment contract, which would establish legally binding terms and conditions to be met by both parties for activities in north-eastern Angola.

The move comes after the country passed “substantive and consistent reforms” in its diamond mining sector that will drive “transformative socio-economic growth for local communities,” the mining giant said in a statement.

“Angola has made significant progress towards creating a stable and more predictable investment environment in which the people of Angola can directly benefit from increased foreign direct investment. As a result of this – and with De Beers’ recognized Building Forever framework for creating lasting positive socioeconomic impact for communities, our innovative FutureSmart Mining programme that is transforming mining technologies to deliver a significantly reduced environmental footprint, and our proven record of establishing responsible and mutually beneficial partnerships in the region – we look forward to positive and transparent discussions with the government about the possibility of future investment.”

“In line with the Organisation for Economic Cooperation and Development Due Diligence Guidance for Responsible Supply Chains, we believe that responsible foreign investment by the private sector can be an important catalyst for social change in countries working to reform their economies. Should we discover an investment opportunity in the region, we will apply the same proven governance, social impact and environmental framework that has contributed to long-term and sustainable socio-economic development in the neighbouring countries of Botswana and Namibia,” said De Beers CEO Bruce Cleaver.

Untapped potential

As the world’s sixth-largest diamond producer and the third in Africa, Angola’s diamond production is a key source of GDP, the government said.

Angola produced 8 million carats in 2020, a 15.4% decrease from 2019’s 9.4 million, according to the country’s Ministry of Mineral Resources and Petroleum.

In a bid to diversify its revenue stream away from overreliance on oil, Angola enacted reforms to its mining sector geared towards improving the regulatory environment.

The reforms included a new model for governing the sector, and the creation of the National Agency for Mineral Resources tasked with regulating, inspecting and promoting diamond mining.

The move expands the miner’s sprawling operations across Southern Africa. De Beers renewed its 10-year diamond sales agreement with Botswana last year.

The London-based firm also signed a new 20-year deal with the government of Namibia in October with perks to help their joint venture Namdeb to weather the storm of the Covid-19 pandemic.

After a tough year, Africa’s diamond industry is regaining its sparkle after the pandemic decimated consumer markets, paralyzed supply chains and led to the closure of mines.

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