The Gemstones sector has initiated a phased re-opening process in line with global demand that is mostly driven by the vast Indian market.
The Covid-19 pandemic has had a far reaching impact on the gemstone sector with only about two companies remaining in operation at half capacity. Only the large scale mines have manage to keep some of their operations running
Currently only Grizzly mining limited is operating at half capacity while Kagem Mining suspended its critical operations since March last year due to the detrimental impact stemming from the pandemic.
As a result of the Covid-19 pandemic all but critical operations at the mine have remained suspended since March 30, 2020 but now Kagem has since started reopening its principal operations in a phased manner starting in the second week of March 2021.
Emeralds and Semi-Precious Stones Mining Association of Zambia (ESMAZ) said not much has been happening in the gemstone sector since last year except for a few companies that have been operating at half capacity.
Speaking in an interview with the Zambian Business Times- ZBT, ESMAZ president Victor Kalesha said due to the pandemic, companies are failing to sustain their operating capital as Indian buyers, who are the largest buyers, have not been able to travel as a result of the lockdown in that country.
“The sector is not doing well due to the effects of the outbreak of Covid-19, there’s literally not much that has been happening in the gemstone sector except for a few companies that have been operating at half capacity level.
“As usual, the Indian buyers are the ones that are more connected to the gemstone sector in Zambia, so if they are not coming, it means there is limited to no money flow for operations especially for the small scale miners who are almost closing down because some of them cannot even pump water on their own due to lack of funds,” Kalesha said.
He disclosed that currently, over 500 gemstone licenses have been issued across the country but only about one per cent were operational due to lack of operating capital and equipment. Kalesha appealed to the Government to find a window which it can use to support or empower the small scale miners to ensure that they do not completely close down.
“We have been facing a challenge of lack of operational capital and equipment, at the moment we are using pick and shovel, but it’s not ideal. So we are lobbying the government to find a window to empower the local miners in the gemstone sector” he said.
“We are also appealing to Zambian owned banks and financial institutions to be flexible in terms of giving out loans to Zambian entrepreneurs especially the local miners. Our members are unable to access loans because of the exorbitant interest rates and steep collateral requirements.
The banks, which in Zambia are mostly foreign owned are not willing to engage local miners and give loans because they feel that emerald and gemstones mining is a risky business,” he added.
