AUREX Holdings is targeting to absorb the mandated 10% marketshare set aside by government to the local diamond cutting industry after commissioning a plant worth $2 million.
BY TATIRA ZWINOIRA
The plant went operational at the end of May and was financed by a loan from CBZ Bank, with the security backed by the Reserve Bank of Zimbabwe (RBZ), Aurex’s major shareholders.
CBZ Bank relationship manager Foster Mxoli confirmed the loan and the security coming from the central bank “as major shareholders of Aurex Holdings”.
Speaking to NewsDay on the sidelines of a tour of their diamond cutting and polishing plant, Aurex general manager Paipa Munhumutema said government set aside the 10% in order to grow the local diamond cutting and polishing industry.
“This plant has just been commissioned and we have just started cutting and polishing the diamonds. The government has set aside 10% of diamonds to be cut and polished locally but you find that the current local diamond polishers cannot absorb that amount. This is a new plant that we have come up with so we might be absorbing all of it we are just starting now but you might find a time where we can absorb all of it,” he said.
“We actually have enough supply of our stocks for our factory and we think there is enough capacity and supply from the local market that warrants the setting up of the diamond cutting industry. The challenge that we have is to develop a market for our diamond cutting industry.”
Munhumutema said the reason why it was difficult for local diamond cutters to operate was due to competition from international companies and that being owned by RBZ gave his company a national advantage.
Aurex Holdings used the loan to acquire state of the art equipment for the new plant from Sahajanand Laser Technologies of India in March this year to automate 75% of the production process. The other 25% of the work will be finished manually.
The new cutting and polishing factory can accommodate 50 polishers in a single shift.
The need for value addition in the diamond cutting and polishing industry stems from an increased amount of the gem being sold unprocessed to export markets and thus at a lower value.
However, Aurex have discovered that when diamonds are sold to the export market when processed the value of the diamonds goes up 10% to 15% over rough diamonds.
Munhumutema said they signed a Memorandum of Understanding with the Zimbabwe Consolidated Diamond Company, which will culminate in a boost in sales.
He said the old equipment would be used to train 28 polishers at a time.
Aurex Holdings has 8 retail stores and 124 staffers across the country.