Kagem creates transparent market for small-scale miners

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Zambia_03Small-scale emerald miners now have the opportunity to sell their emeralds at highly competitive market prices and with the added comfort of knowing that the entire process will be done in a fully transparent and legitimate way, thanks to a new purchasing scheme launched by Kagem Mining that aims to bring greater levels of disclosure to the industry and to ensure that the country receives the full benefits from its gemstone resources.

Deputy Minister of Mines, Energy and Water Development Hon. Richard Musukwa officially opened the Kagem Mineral Purchasing Office in the Mega Shopping Centre in Kitwe today and heralded the development as an important milestone in the move towards creating a market in which small-scale miners were able to achieve highly competitive prices for their emerald production, ensuring that these gems were appropriately processed within Zambia itself and improving the overall transparency of the local market for emeralds and beryl.

In recognising Kagem as a flag-bearer for fully auditable and maximised value in gemstone production, processing, marketing and sales, he said: “The government called on Kagem through Gemfields to continue to work with small scale miners to have a platform for them to trade in order to have full value from their minerals.”

The new buying centre will operate on a “willing seller-willing buyer” basis and will provide a point at which miners can bring their gemstones to be appraised by professionals. If a price is agreed then the gemstones will be sent to Kagem’s existing processing facility where they will be generally processed, washed, chipped, cobbed, cleaned, graded and sorted in accordance with the company’s proprietary grading systems – a system that has clearly added value to the emeralds that they have produced over the past few years.

Kagem will then aggregate the graded gems with other purchased material in order to create parcels of meaningful – and more valuable – size for onward sale at Kagem’s well-documented and highly transparent auctions.

“Given that Kagem’s marketing, sizeable investments and in-depth understanding of the global markets have allowed it to achieve the highest possible value and repatriation of much needed foreign earnings for their Zambian emeralds, we are confident that this facility will offer the highest prices available,” explained Kagem’s chairman William B Nyirenda, who emphasised that the centre in Kitwe would not sell gemstones.

The purchasing office was a “win-win development for all parties legitimately engaged in the Zambian gemstone industry”, he added.

“This is a transformative development because it provides immediate access to fair market prices for small scale miners and other emerald sellers who are today often taken advantage of by unscrupulous buyers. Moreover, government will be further assured that a greater proportion of Zambian emeralds will see royalties and taxes accrue at full value, all via a mechanism that is transparent and fully auditable.”

Ian Harebottle, Chief Executive Officer of Kagem and Gemfields plc, which owns 75 per cent of Kagem in partnership with the Zambian government, said: “Gemfields has been delighted to have government as a 25 per cent shareholder in Kagem, ensuring that government has direct insight into Kagem and the gemstone sector. Kagem has demonstrated that Zambia can benefit meaningfully and accurately from its gemstone resources by receiving royalties and taxes that fairly represent the international market value of the gemstones.”

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Start: 2019-07-01 End: 2019-07-31