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South Africa joins international diamond marketing campaign

South Africa's Cabinet has approved the participation in a global effort to promote the marketing of actual diamonds. This is in response to the growing appeal of lab-grown gemstones. The initiative will be funded by a 1 percent levy on annual revenue of diamond companies.

Natural diamond prices have fallen in recent years, due to the increasing demand for synthetic gems and the global macroeconomic volatility.

De Beers, a division of Anglo American, and the leading African producers, as well as trade associations and De Beers, signed an agreement in June to work together on promoting natural diamonds and driving global demand.

The Natural Diamond Council spearheads this initiative. Signatories plan to dedicate 1% of their annual revenue from rough diamond sales for funding.

South Africa did not sign the agreement at first, but Minister Khumbudzo ntshavheni announced on Thursday that the cabinet approved the Department of Mineral Resources and Petroleum to participate in international agreements designed to help diamond-producing nations better market and promote natural diamonds worldwide.

Ntshavheni stated that "for this to become a reality, the cabinet has approved that the diamond sector be asked to contribute 1% from their annual revenue generated by rough diamond sales in order to support marketing South Africa's actual diamonds for economic growth and to create jobs."

Synthetic diamonds, with their reduced environmental impact and competitive pricing, are becoming more popular among younger ethically-conscious consumers. This shift is forcing traditional diamond mines and retailers to reconsider their strategies.

South Africa is the 6th largest diamond producer in terms of volume. In 2024, its diamond production fell 0.9% to 5.8 million carats. Total sales were 13 billion rand (731.45 millions dollars), down 21% since 2023.

At a Tuesday meeting with diamond producers, Mines Minister Gwede Mantashe stated that "lab-grown diamonds are eating our dinner".

"I am convinced that marketing natural diamonds as a necessary action."

(source: Reuters)