Angolan diamond production up, but revenues increase at significantly slower rate

Angola sold just over 9.44-million carats of diamonds last year, earning $1.299-billion, the National Diamond Commercialisation Company of Angola (Empresa Nacional de Comercialização de Angola) – better known as Sodiam – has reported. This represented a year-on-year increase of 12.3% in production and 6.2% in revenues.

At the presentation of these figures, in Luanda, Angolan State Secretary for Geology and Mines Jânio Correia Victor described them as “satisfactory results”. He explained the smaller increase in revenues, compared with the rise in production, as being due to a fall of about 10% in diamond prices in international markets.

Regarding last year’s final quarter, Angolan diamond production totalled three-million carats, sold at an average price of $136.40 per carat and bringing in revenues totalling $409.77-million. Compared with the same period in 2018, these numbers represent an increase in production of 7.5% but a fall in revenues of 10.2%.

Victor forecast that national diamond production would continue to increase this year. He expected an output of 14-million carats, “to comply with the goals established in the National Development Plan (2018–2022)”.

Also during last year, Angolan law enforcement’s anti-illegal diamond trafficking and anti-illegal immigration initiative, Operation Transparency, resulted in the seizure of 6 579rough diamonds and 19 vehicles in the province of Lunda Norte alone.Significant quantities of cash were also seized, comprising $275 000, three-million Angolan kwanzas and 80 000 Congolese francs. These statistics were released in a report of the Provincial Civil Protection Commission. (Lunda Norte is in north-east Angola and is bordered by the Democratic Republic of Congo (DRC) on both its north and east.)

The operation also resulted in the detention of 147 379 foreigners with ‘irregular’ immigration status. Of these, 147 006 were from the DRC and 158 were West Africans. They were repatriated to their home countries.

In another report issued this month, Angola’s General Tax Administration (Administração Geral Tributária – AGT) revealed that it had collected $178-million (89-billion kwanzas) in tax revenues from the country’s mining sector during the period 2015 to 2019. This tax income was almost entirely from the diamond mining sector, gathered within the framework of both the general tax regime and the special tax regime. It was also the result of the measures determined by government regarding the country’s diamond commercialisation policy.

In his presentation opening a mining-sector taxation seminar, AGT CEO Cláudio Pauline dos Santos noted that 472 mining-sector companies were registered on his agency’s database and paid tax. “Of these companies, 131 are active in the diamond sector, representing almost a third of the total,” he pointed out. “It’s value-added, since this appears to have an enormous potential for the collection of taxes for the State.” He highlighted his agency’s role in the oversight of the diamond sector, as these companies had to operate in conformity with the law and regulations, as well as with the strict norms of international transparency.

The seminar ran for five days and was focused on discussions and the exchange of expertise between experts from various organisations. These included the Intergovernmental Mines, Minerals, Metals and Sustainable Development Forum and the African Tax Administrations Forum, as well as the AGT.