Hope for Teemane Diamond Company�s reopening
Onalenna Kelebeile | Thursday April 16, 2015 18:00
This was said by Member of Parliament for Serowe North, Kgotla Autlwetse, in the backdrop of advanced talks to re-open the factory.
The diamond cutting and polishing company, previously owned by Diarough, closed down early this year due to commercial pressures, which led to over 300 job losses.
Autlwetse, who is also the assistant minister of education and skills development, said they were working around the clock to ensure the company resumes operations.
It could be operated by the company, which had been operating Teemane Manufacturing Company or any other interested company.
“I am very hopeful that out talks will bear fruit as we are still in talks with potential companies,” he said.
The legislator, however, said he was not at liberty to disclose the identity of the companies he was talking to; noting that they did not want to count their eggs before they had hatched.
The closure of Diarough, which was the biggest employer in Serowe, spelt economic doom for the employees’ and their dependents.
Autlwetse confirmed that the workers had received their terminal benefits from the company, but noted that although there had been a few disgruntlements regarding the benefits, these were minor issues that could be addressed in due course.
The legislator called on government to assist the company with logistical support to prevent the closure of Diarough operations to save jobs, earlier this year. The company had been operating in Serowe since the 1990s.
Efforts to get comment from former general manager of Teemane, Mervin Lifshitz proved fruitless.
Due to depressed polished prices set against high rough prices, cutting and polishing companies globally are currently facing difficulties, with the 20 local manufacturers’ situation exacerbated by the comparatively higher labour costs.
High labour costs in Botswana’s fledging diamond cutting and polishing industry have always been perceived as a possible threat to the beneficiation efforts, as it renders local polished diamonds uncompetitive on the global market.
It is estimated that diamond cutting costs $12 (P114) to $25 per carat in India, $20 to $30 in China while in Botswana it costs between $60 and $65 per carat. The 20 local cutting and polishing firms buy rough diamonds from De Beers, before cutting and polishing them for sale on the global market where polished diamond prices are said to be ‘very low’ compared to the high prices of rough charged by De Beers.
The combination of high rough prices and market-induced strain on the cutting and polishing business in Botswana has recently triggered severe cutbacks in an industry that employs around 3,700 people. TMC’s closure brought the number of local redundancies in the past six months to over 500, dealing a blow to the beneficiation efforts.
In November last year, Motiganz Botswana retrenched 100 workers while Leo Schachter, another De Beers Sightholder also laid off 50 of its 250 workforce in January this year.
“The local cutting and polishing business is uncompetitive on the global market. Some of the companies operating in Botswana are making losses but continue to operate here because they need to secure supply for themselves and their parent companies abroad,” an industry insider said.