1. Steinmetz Diamond Group
Who is the Steinmetz Diamond Group
Track record in Southern Africa
Diamond Industry – today
South Africa - concerns

2. Steinmetz Diamond Group

3. Steinmetz Southern Africa
South Africa
Namibia
Ascot Diamonds
B.E.E.
Partners
B.E.E.
Partners
B.E.E.
Partners
40%
30%
30%
ABT Diamond
Cutting Works
Giyela Diamonds
Namcot Diamonds

4. Group’s track record Ascot Diamonds formed in 1988
ABT Diamonds (one of the first local BEE partnerships in the industry) was established in 1997 – specialises in Fancy Cuts (in house training).
Combined Assets in excess of R1 Billion
Namcot Diamonds was formed in 2000
Giyela Diamonds formed in 2003
Employment level at present is 430 in Southern Africa & the largest employer in South Africa

5. Diamond Industry - today
Employment by cutting center
India
800,000
China
25,000
Thailand
7,000
South Africa
2,300
Israel
< 2,000
Belgium
< 1,000
New York
200
Labour costs varies from US$ 8 pc to US$ 200 pc

6. South Africa – Concerns
Strong Rand increasing labour costs
Value Added Tax
Free trade activities restricted

7. South Africa – Concerns
Deferment of payment of Export Duty (Section 64)
The design and manufacturing process of large & special stones is seldom completed in one step.
It is often required to temporarily export the stones due to
high degree of difficulty
specialised process such as lasering, cleaving etc
professional opinions
seeking potential buyers
or any other partial processes that will assist in maximising the outcome

8. South Africa – Concerns
Deferment of payment of Export Duty (Section 64)
We believe that if Section 64 is removed it should be replaced by a
method that will allow the Regulator (New Diamond Board) to judge
each deferment case on its merits so as not to
DISADVANTAGE THE LOCAL INDUSTRY

9. South Africa – Concerns
Beneficiators not allowed to sell/export rough (Section 40 permit)
Not all beneficiators rough requirements are alike
The % of suitable rough bought by a beneficiator varies dependent on the source
Leftovers from the sawing process (fragments) are also categorised as rough

10. South Africa – Concerns
Beneficiators not allowed to sell/export rough (Section 40 permit)
The removal of s40 permits affects both new entrants & existing beneficiators alike
It is not economically viable to manufacture the full range of rough in South Africa (10% rule of thumb)
Often, factories specialise in specific ranges of rough
(i.e. 1 shoe does not fit all)

11. South Africa – Concerns
Beneficiators not allowed to sell/export rough (Section 40 permit)
The inability of any beneficiator to dispose of non economical rough/ fragments or any other non suitable goods will impair the beneficiator financially and unfairly disadvantage it.
The government should not put the industry at such a disadvantage to its international competitors.
Currently s40 permits are controlled & issued by the Diamond Board & we suggest that the new regulator should have the similar powers to control this matter.

12. South Africa – Concerns
Funding of and Representation of State Diamond Trader (Section 17)
No information with regards to the proposed regulations of the State Diamond Trader is available
The possibility of private funding & combined with board representation may lead to a conflict of interest
The funding of the State Diamond Trader should remain with government

13. South Africa – Concerns
Other Issues
It is crucial for an industry to have a consistent suitable supply of rough in order to be sustainable and grow.
Non South African Goods
The bill should address the issue of Export Duty on Non SA goods
It is silent at present

14. South Africa
Thank you