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Israeli diamond mogul Lev Leviev offered the clearest support yet of African efforts to develop a thriving diamond manufacturing sector on the continent at the international jewellery conference in India.
"The old excuse that it is economically not viable to polish diamonds in Africa no longer holds water.

"Those who believe that cheap labour costs are the main factor in the success of diamond manufacturing are making a great error ," said Leviev.

African governments are in various stages of negotiations with diamond miners and manufacturers about cutting and polishing diamonds on the continent.

Beneficiation, the process of adding value to diamonds by polishing and cutting, is viewed as a means of compensation for the jobs the mining sector is shedding.

Governments are receiving mixed results because some major players prefer major diamond-cutting centres such as Antwerp in Belgium and Israel that have a supportive infrastructure like a diamond exchange and access to finance.

Other players prefer centres with low costs such as India and China.

Leviev said Africa's diamond-producing countries such as Namibia, Botswana, Angola and South Africa were "no longer prepared to give up their major natural resources to be exported to cheap labour-cost countries".

"They also want to benefit from the added value for their own economies and to give employment opportunities for their own populations," he said.

Leviev said his company had been manufacturing in South Africa and employed many workers.

He said the cost of producing one carat on the continent was about US$35 a carat (about R232) "but we believe that soon we will reach a higher level of production and a cost of $25 a carat.

"In Angola we will be opening a new factory and will have more than 500 local employees by the end of the year.

"In Botswana we have presented the government with a proposal to open a polishing plant that will give employment to 2 000 locals.

"In money terms we are talking about a multiple of 10. This means, for example, that 500 workers in Namibia produce an income the same as 5 000 in India. Or 2 000 in Botswana will produce the same income as 20 000 in India."

Minerals and Energy Minister Phumzile Mlambo-Ngcuka urged India, whose diamond tertiary sector is very advanced, to assist South Africa and other African countries in their efforts.

India is home to the world's largest diamond-cutting centre and almost 1 million people are employed in this industry.

Mlambo-Ngcuka said Africa also wanted to use its diamonds for development, peace and prosperity.

"We are looking to become a major international diamond-cutting centre and trading hub without taking anything away from you," she said.

Selekane said Indian cutters and polishers would be brought to South Africa to train locals and that entrepreneurs would be encouraged to invest locally.


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