The South African government is looking to use the African Growth and Opportunity Act (AGOA) and an existing free trade agreement with the EU to give the country's small-scale diamond beneficiators access to new markets, miningmx.com reports.

Deputy Minister Godfrey Oliphant told parliament last week that most of South Africa's diamond beneficiators have to sell their polished diamonds to one of the five major polished diamond wholesalers operating in the country.



According to Oliphant, these wholesalers are accused of driving down polished diamond prices, which hurts the manufacturers' profit margins.

Oliphant further noted that South Africa was one of the few countries involved in the entire diamond supply chain, from exploration and mining through retail, and said it was "worrying" that it remained "a small player in the downstream sector… with a disproportionately small and underdeveloped beneficiation strategy."

The deputy minister also touched on another issue for smaller diamond manufacturers – an uncertain supply of rough diamonds – and said that his department was working with the State Diamond Trader and producers to ensure that there was a consistent supply of rough product.