Angola to Curb Sodiam's Control of Rough Sales

RAPAPORT... Angola plans to allow miners to sell up to 60% of roughdiamonds to companies of their choice, including to their own tradingdivisions, Reuters reported last week. The changes are part of the country's reforms to its diamondsector under President Jo??o Louren??o, who came to power inSeptember. Producers must currently sell through state-owned tradingcompany Sodiam. As a result, Catoca, Angola's largest diamond mine, lost anestimated $464 million over the past six years because Sodiam often sold goodsto politically connected buyers able to negotiate below-market prices, Reuterssaid. The new system will price rough diamonds according to abenchmark based on a sample of typical stones produced in Angola, the reportsaid, citing a draft presidential decree that could still change. The stoneswill also undergo an evaluation using a price list "in line with theinternational market." In addition, Angola will introduce sales that are open topre-approved buyers, similar to De Beers' sights. Exceptional stones will go upfor auction individually at separate events, the report said. Angola's government will also increase its oversight of thesector, which previously had a lot of freedom as state-owned diamond companiesSodiam and Endiama had significant influence under former president Jos?(C)Eduardo dos Santos, the report continued. Under the reforms, ministers will havethe power to appoint independent evaluators to intervene in disputes, and setmore transparent criteria for Sodiam's selection of buyers. That includesgiving priority to polishers and jewelry manufacturers over traders who resellthe diamonds.