Namibia's diamond sector faces challenges amid global demand slowdown

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WINDHOEK, April 8 (Xinhua) -- Namibia is encountering challenges in its diamond sector, with sluggish global demand leading to declining prices, a senior official said Monday.

The demand for unpolished diamonds in major markets such as India and China has slowed, leading to downward pressure on prices, said Namibian Minister of Mines and Energy Tom Alweendo during a budget motivational speech to the parliament.

He also highlighted a potential risk posed by the Group of Seven (G7) countries. "We are also faced with a potential risk where the G7 countries require that all rough and polished diamonds destined for their markets be routed through Antwerp, Belgium," he said.

Alweendo expressed concerns that such a requirement could limit Namibia's export options, increase costs, and reduce competitiveness in the global diamond market. He revealed that Namibia is actively engaging with the G7 countries to reconsider their decision, emphasizing the importance of maintaining flexibility in diamond exports.

Alweendo, however, reported positive developments in Namibia's mining sector amid these challenges.

He noted an increasing influx of investment in exploration and mining activities in the country. "This is on account of an increase in both demand and prices for commodities such as uranium, gold, and lithium," he noted.

Several mining license holders, including Osino Resources, Bannerman Mining Resources and Reptile Uranium, are in preparatory phases for construction, signaling growth opportunities in the sector, he added. He said the government decided to prioritize in-country value addition for critical minerals like lithium before exportation.

According to Alweendo, the mining sector contributed more than 12 percent to the country's gross domestic product in 2022 alone. Additionally, for the 2022/2023 financial year, the sector contributed more than 3 billion Namibian dollars (about 162 million U.S. dollars) to the national fiscus. Enditem

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