By February 1, 2019

Angola Is Turbocharging Its Economy Through Mining

By February 1, 2019

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Angola, in a feat to renew the face of its mining industry, has gone back to the drawing board and the quarries to boost its economy. The Southern African country commenced its maiden diamond auction yesterday, which recorded huge participation as 35 companies bade for seven high carat stones.

Angola’s government has established an initiative that foreruns the reinstatement of its commitment to innovation and transparency in the country’s diamond industry. With the aid of a sealed system through which participants electronically submit their biddings, other parties are kept in the dark as per their competitors’ bids, which is a right move in the direction of transparency.

Diamond producers have long tendered their dissatisfaction with the bidding process, pointing out that they usually don’t get back the true worth of their precious stones. The newly-introduced sealed system is not just an innovative breakthrough, but a great way to ensure fairness in the transactions.

Prior to this, producers sold their stones via an opaque government marketing to buyers selected by the government. The process often resulted in prices lots of papers below the stones’ international prices. The new system will also help the Angolan mining industry raise awareness regarding the quality of the stones mined in the country while diversifying its economy from being solely dependent on oil.

A 2014 ENDIAMA research showed that traffickers in Angola produced more than USD 140 Mn worth of diamonds in the year’s first seven months, while government efforts in the same space amounted to less than USD 130 Mn. The government’s massive crackdown – Operation Transparency – advertently and inadvertently shoved 400,000 migrants off the Angolan territory amidst other repercussions.

October 2018, Zambia.com reported that more than 30,000 diamonds were seized by the government in various provinces an Angola. The seizure was one of the first signs of the country’s transparency operation which began in late 2017. The raid also led to the recovery of 150 vehicles and USD 80 K worth of cash. Over 800 people were detained by the Angolan police, peddlers who were believed to be illegal aliens thwarting the country’s mining industry.

Forthwith, there will be a mining project in the municipality of Nambuangongo in Angola Bengo Province. Expected to commence this August, the project will be digging for gold deposits with an annual production of 450 kilograms of gold expected. According to Diamantino Azevedo, the Minister of Minerals and Oil in Angola, the country’s economic diversification would be fostered by the implementation of macroeconomic policies favorable to the sector.

With extensive diamond reserves estimated at 180 million carats, Angola is the fifth largest diamond producer in the world. In 2013, it’s total rough diamond production was 9.4 million carts with a value of USD 1.28 Bn. While the country comes third in diamond production in Africa after the DRC and Zimbabwe, Angola has pledged to nitro-charge its mining efforts and per carat value to become among the world’s top three by 2021.

Featured Image: Breakbulk

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