BUSINESS

Kagem transparency impresses IDC

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Kagem transparency impresses IDC

August 10, 2018 LUSAKA, ZAMBIA – Industrial Development Corporation (IDC) Chief Executive Mateyo Kaluba has welcomed efforts by Kagem Mining to ensure transparency in the gemstone sector. Gemfields continues to be instrumental in putting Zambia on the world map as a competitive, reliable and trusted source of responsibly sourced gemstones, with a successful auction of commercial quality gemstones in Lusaka last week. Speaking during the company’s auction of lower quality emeralds in Lusaka last week Mr Kaluba said: “It’s been very insightful to see how the markets work and see the interface between what we mine at Kagem and the markets. It’s also interesting to see how much pride the staff of Kagem have in their product, and to know that we have some of the biggest international buyers following Zambian gemstones. It gives us confidence that this is a viable sector and also gives us the confidence that the resources that are declared and made from gemstones are competing at the best market price that they can get. It’s been an honour to see how the market works.”

The Zambian government – through IDC – owns 25 per cent of Kagem Mining in Lufwanyama, in partnership with London-based Gemfields. This week’s auction attracted some 22 international buyers and offered 21 lots weighing a total of 579kg (2,895 carats) of lower quality emeralds from Kagem, the world’s single largest producing emerald mine. The auction generated total revenue of US$10.89 million with an overall average value of US$4.21 per carat. Solid demand resulted in 90% of the offered carats being sold.

Following the official opening of the auction by Kagem chairman Dr Sixtus Mulenga. Mr Kaluba inspected the emeralds on offer.  “It’s one thing to see an emerald on someone but also learn to appreciate the process and the dynamics is very insightful,” he said. “We have to make sure that Kagem continues to grow. Their model is excellent and it maximises value. “There should be more Zambia skill around the area of gems so we have a better understanding and appreciation of how the market works. Sometimes there is a lot of misinformation out there because people don’t really understand the dynamics of the industry and the more skills and knowledge we have, Kagem can play that critical role to ensure that is a dominant component of the mining sector.
Gemfields’s 30 auctions of emeralds and beryl mined at Kagem since July 2009 have generated US$538.39 million in total revenues, of which US$91 million has been paid in taxes and royalties to the government.

The proceeds of the auction will be fully repatriated to Kagem in Zambia, with all royalties due to the Government of the Republic of Zambia being paid on the full sales prices achieved at the auction.  Sean Gilbertson, CEO of Gemfields, commented on the auction: “Given the difficulties experienced by the India gemstone sector this year, the strong results from this auction underscore the enduring vigour of consumer demand for responsibly sourced Zambian emeralds and the accelerated recovery that this demand facilitates. While the Indian emerald trade is not out of the woods yet, we take significant comfort from these Lusaka auction results. We thank the very hardworking Gemfields and Kagem teams, our customers and our partners in Kagem, the Industrial Development Corporation of Zambia and look forward to furthering the Zambian emerald sector’s prominence internationally”.

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