Angola is the fifth largest diamond producer in the world and the third biggest in Africa. With diamond reserves estimated at 180 million carats, Angola could be on track to become the top producer and the government is putting plans in place to get there.
1. In a bid to fully reform the country’s diamond industry, the government has ended the monopoly of the state-owned company SODIAM EP as the diamond trade body in Angola. SODIAM now controls only 60% of industrial diamond production sales, although it still fully controls the sale of semi-industrial and artisanal production.
SODIAM chairman, Eugenio Pereira Bravo da Rosa, and Angola’s Minister of Mineral Resources and Petroleum, Diamantino Pedro Azevedo, recently visited Dubai Diamond Exchange (DDE) to learn from their business model. The government is considering replacing SODIAM with a diamond bourse – a more transparent and open diamond sales environment.
2. The celebrated privatisation program taking place in Angola will encompass Endiama EP. The state-owned company is the public body responsible for conveying diamond mining rights in Angola. Endiama is due to be partially privatised and listed on the Angolan stock exchange, BODIVA, with its initial public offering expected by 2022.
3. The third measure to boost private investment in the industry, is the opening of diamond cutting factories in the country. In 2019, two cutting plants were established:
i. Stone Polished Diamond factory, which began operations in February 2019 and is owned by SODIAM (10%), MWS Empreendimentos e Servicos Lda (60%) and South Africa-based Rez Diamonds Pty (30%).
ii. Pedra Rubra opened in September 2019 and is owned by SODIAM, India-based KGK Group, Unpolished Stone Trading Lda and the Radiance Diamonds Comercio e Exploracao de Diamantes Lda, the latter being owned by UAE-based Prime International DMCC.
These series of measures are part of Angola’s efforts to move out of recession and reduce the public debt burden by diversifying away from oil. Due to the country’s natural richness, diamonds are potentially an obvious alternative to diversify the economy and encourage foreign and domestic investors.
