JOHANNESBURG (miningweekly.com) – Mineral Resources Deputy Minister Godfrey Oliphant has urged diamond industry participants to remain committed to efforts to grow and sustain the industry in South Africa.

Speaking at the South African Diamond Producers Organisation (Sadpo) conference last week, he said this would yield positive outcomes that would move the South African diamond industry forward, while ensuring that South Africa becomes “the heartbeat of Africa’s beneficiation”.

The yearly Sadpo conference is aimed at collectively identifying growth constraints and recommending solutions to resolve those constraints in order to unlock the industry’s potential.

With special reference to the revival of South Africa’s minerals sector through ongoing support and refinements to progressive policies, Oliphant said South Africa, in terms of the attractiveness of its mining policies, now ranks fifty-sixth out of 83 countries surveyed in the latest Fraser Institute’s annual global survey of mining jurisdictions.

In terms of investment attractiveness, South Africa’s ranking has improved to forty-third out of 81 countries.

However, despite these improvements, he warned that the country still “has more ground to cover”.

In delivering his keynote address, the Deputy Minister reaffirmed the Department of Mineral Resources’ commitment to promoting and regulating the sector to ensure transformation, growth and development, as well as ensuring that all South Africans derive a sustainable benefit from the country’s mineral wealth.

“Our country faces a brighter [future] and more promising prospects . . . as we see more investment into our economy,” he said.

An example of this, Oliphant highlighted, was the commitment made by the mining sector at the Presidential Investment Summit, where the sector collectively pledged to invest almost R100-billion.

As part of government’s commitment to investing in the growth of the country, Oliphant said the DMR had developed key policies to promote and implement beneficiation of South Africa’s raw materials, especially diamonds.

He referred to the strategic policy document, titled ‘A Beneficiation Strategy for the Minerals Industry of South Africa’, wherein the strategic policy provides a framework for the orderly development of the country’s mineral beneficiation value chain.

The strategy identifies five key constraints to local mineral beneficiation, namely limited access to raw materials; the shortage of critical infrastructure; limited exposure to research and development; inadequate skills; and access to international markets. 

To overcome these constraints, the strategy proposes a four-pillar framework. Oliphant urged delegates attending the conference to “critically assess and promote this framework so that diamond beneficiation becomes a major driver in advancing the empowerment of historically disadvantaged individuals in our country, as it presents opportunities for the development of new entrepreneurs in the small and microenterprise businesses”.

He further urged all small-scale miners under Sadpo to comply with section 59B of the Diamond Act, which provides for the offer of diamonds produced in a production cycle to the State Diamond Trader (SDT).

“I believe there are engagements happening around this matter to identify challenges in complying with the Act and find sustainable solutions. The ease of doing business has proven to attract investment, in this regard, the South African Diamond and Precious Minerals Regulator is looking at reducing the red tape [with regard to] registration as a producer and authorised representative,” he elaborated.

The DMR is also looking to strengthen its relationship with diamond trading houses to which small-scale miners sell most of their production.

Additionally, the SDT continues to drive initiatives to increase participation and employment in beneficiation including raising the amount of suitable rough diamonds offered annually to ensure clients have security of supply.

The SDT prioritises historically disadvantaged South African clients, especially the youth and women, when allocating diamonds, Oliphant explained, highlighting that this will increase the amount of rough diamonds sold to previously disadvantaged clients to accelerate their growth and ensure that they are sustainable.

“We want to see at least 30%, by mass, of the rough diamonds sold by the SDT going to black clients by 2023. In addition, the entity will ensure that there is a constant stream of new black diamond entrepreneurs entering the sector through its enterprise development programme.”

Investment in state-of-the-art exploration technologies would enable new discoveries that conventional geological surveys could not find, Oliphant said, adding that research and development in modern diamond exploration techniques were critical in maximising the potential of finding more world-class diamond deposits.