UK-ZAMBIAN GEMSTONE PARTNERSHIP HAILED BY HIGH COMMISSIONER
LUSAKA, ZAMBIA, June 23, 2015 – The partnership between the Zambian government and British gemstone exploration, mining and marketing company Gemfields plc has been commended by British High Commissioner James Thornton.
Lufwanyama-based Kagem Mining – the world’s largest emerald mine – is owned 75 percent by Gemfields and 25 percent by the Zambian government and generated US$56 million (approximately K500 million) in corporate tax, royalties and dividends payable to the state since Gemfields took over operations in 2008.
“The capital required for investment in the mine was I gather raised in London and it seems to me that this mine is a very good example of a British company investing responsibly here in Zambia and setting an example for other companies. What you need for a foreign investment is for it to be win-win; it has got to work for the country where the investment is taking place and it has got to work for the company concerned which needs to make a rate of return. The good thing about Gemfields is that under its stewardship Kagem has returned to profitability; is paying dividends to its shareholders, being both Gemfields and the Zambian government and has created jobs and I think that’s excellent,” said Mr Thornton during a tour of the mine this week when he inspected mining operations at the pit, saw secondary exploration sites and visited the company’s emerald sort house.
“It is a phenomenal operation and I am pleased that Gemfields is a British company which is leading the way in terms of the way it grades stones and is organising structured auctions; and seems to have been very successful in raising the value of emeralds,” he added.
In March 2015 Gemfields was the largest mining company listed on the Alternative Investment Market (AIM) of the London Stock Exchange where it is a constituent of the AIM50 index. It was also the 18th largest mining company listed on the London Stock Exchange as a whole in terms of market capitalisation.
Since Gemfields took over operation of the mine in 2008 it has invested US$60 million in turning Kagem from a long history of making loss to one where it has been able to increase achievable prices on the global markets tenfold and contributed more than K2.436 billion (US$324.9 million) to Zambia’s direct foreign earnings.
To date, Gemfields has held 18 auctions of emerald and beryl produced from Kagem that have generated revenues totalling US$325 million.
Kagem has generated more than US$40 million in corporate taxes payable to the government in the last three years, along with US$12 million of mineral royalties and US$4 million as the government’s share of dividends, explained Kagem’s Director of Operations CV Suresh.
The workforce has doubled in the last six years, and the company now employs 658 staff, all of whom are permanent and pensionable.
Gemfields and Kagem are at the forefront of developing the international market for Zambian emeralds by investing in exploration, mining, sales and marketing in order to develop a competitive, reliable and trusted source of ethically produced gemstones while pioneering new environmental, social and safety standards in the coloured gemstone sector.
As a British company Gemfields is also a founding member of the British Chamber of Commerce Zambia.