By Enyichukwu Enemanna
South Africa’s cabinet on Thursday approved the country’s participation in an international effort to enhance the marketing of real diamonds, in response to increasing appeal of lab-grown gems.
This comes as the 30% tariff imposed on the Southern African nation by the United States commences on Friday.
US is South Africa’s largest trade partner after China. Washington and Beijing have the largest demand for diamond.
Pretoria had sought to reach a deal with Washington in a last-minute effort to overcome the tariffs which analysts believe will cause massive job loss but President Donald Trump’s administration insisted that the August 7 deadline for the trade policy to take effect remains.
Diamond market has in recent years struggled as a result of rising consumer demand for the cheaper synthetic gems, in addition to global macroeconomic volatility which has led to free fall for the price of the high-valued mineral resource in international market.
But in June, representatives from leading African producer nations and trade bodies signed an accord aiming to join efforts to promote natural diamonds and drive global demand.
South Africa was not part of countries that signed the accord, but Minister in the Presidency Khumbudzo Ntshavheni on Thursday announced that cabinet had approved the Department of Mineral Resources and Petroleum’s participation in international agreements aimed at helping diamond-producing countries better promote and market natural diamonds globally.
Parties to the accord intend to allocate 1% of the annual revenue generated from the sale of rough diamond to fund this initiative, spearheaded by the Natural Diamond Council.
“For this to be realised, cabinet has further approved that the diamond industry be requested to contribute 1% of their annual revenues generated from rough diamond sales to support marketing of South Africa’s real diamonds to enable economic growth and job creation,” Ntshavheni said.
Heritage Times HT understands that South Africa is the world’s 6th-biggest diamond producer by volume.
Its diamond production however dipped t0.9% to approximately 5.8 million carats in 2024, with total sales of 13 billion rand ($731.45 million), down 21% from 2023.
“Lab-grown diamonds are eating into our dinner,” Mines minister Gwede Mantashe said at a meeting with diamond producers on Tuesday.
“I’m very convinced that the marketing of natural diamonds is a necessary intervention.”
Lab-grown diamonds are real diamonds produced in a controlled laboratory environment, mimicking the conditions under which natural diamonds form.
They are different from the natural diamonds which are mined from the earth, as against lab-grown diamonds, largely created through advanced technological processes.
