TRALAC - Trade Law Centre

South African jewelry manufacturing facility to benefit from AGOA

Monday, 01 September 2008

Source: Idex Online

A R100 million ($13 million) broad-based black economic empowerment (BEE) jewelry manufacturing company has been established in Kimberley, South Africa. Gold Chain Technology will manufacture solid and hollow gold and silver chains, fish-hooks, clasps and tags, predominantly for export.

The facility, which was enabled in part by the Industrial Development Corporation (IDC) with R14.5 million ($1.88 million) in development finance, is a joint venture between Italian-owned Q-Quality International, BEE investment company Solandra Investments and a Northern Cape community trust.

IDC stated in a release that the project is part of “maximizing the government’s aim for beneficiating South Africa’s raw materials” and that the investment “essentially creates a new industry within the Northern Cape in line with the stated objective for funding projects in partnerships.”

Production will be 94 percent gold and 6 percent silver with a budgeted 85 percent destined for the U.S. market and the balance to 22 identified markets. The African Growth and Opportunity Act (Agoa) eliminates the 5.7 percent import duty payable into the U.S., “effectively giving,” IDC said in a release, “South Africa a competitive advantage over Europe.”

The facility plans to train 460 people in jewelry manufacturing and design within five years. The bulk of the skills are to be transferred from Italian technicians to locals with several future trainers acquiring machinery and equipment training in Italy.

In addition, IDC noted, the Northern Cape Government and De Beers will establish and academy to promote the jewelry profession. Students from this academy will be absorbed by Gold Chain Technology.