South African diamond miner De Beers and parent company Anglo American had their day in front of the South African parliamentary committee that is considering the proposed Diamond Amendment Bill.

 

On Wednesday each of the two companies made a presentation to members of the Parliamentary Portfolio Committee (PPC) on Minerals and Energy. And while Anglo made several statements that have prompted strong and bitter responses in its bid against the bill, De Beers tried a softer approach, asking to continue consultations before enacting the bill.

 

The new Bill calls for a 15 percent export tax on goods miners choose not to leave or sale in South Africa and for setting up a state company that will buy rough diamonds from miners and sell them to local diamond polishers.

 

"The Bill in its present form will have an adverse impact on employment, growth and investment in the mining industry," warned Anglo American's head of regulatory affairs, Tebello Chabane.

 

"It will directly discourage further investment in the exploration and mining of diamonds in South Africa," he added.

 

This prompted parliament member Christopher Molefe of the ruling African National Congress to accuse Anglo of lining its pockets at the expense of the disadvantaged.

 

"Why are you against (the bill)?" he asked "Is it because for many years, for a 100 years perhaps, you did nothing about skilling us?"

 

Diamond Trading Company managing director and De Beers s.a. Managing Director-designate, Gareth Penny, warned of the impact on bottom-line results. "We are not against the Bill, but many of our mines will be faced with enormous challenges," he said. "The 15% export duty will have impact on profitability."

 

De Beers urged the committee to consider suggested amendments to the Bill. The proposed amendments include the introduction of a separate and concurrent Money Bill to deal with export duty regime and the inclusion of State Diamond Trader (SDT) regulations. 

 

De Beers has also proposed a range of initiatives it believes will help ensure the achievement of the goal of a successful yet transformed industry under the new legislation, including:

Beneficiation Charter and Scorecard;

Client Criteria to lead transformation;

Commitment to Supply the Local Industry;

Commitment to Supply Smaller Players;

Strategy to grow the Local Industry; and

SADC Aggregation.

 

“We plan to work constructively with Government to address these issues in order to foster a successful yet transformed diamond industry in South Africa.”