By Julius Zheng •
1 April 2020
Kagem emerald mine in Zambia. All images courtesy of Gemfields
Gemfields CEO Sean Gilbertson
Rough emeralds from Kagem mine
Mozambique rubies from Gemfields
Sean Gilbertson, CEO of coloured gemstone miner Gemfields, talks about the relevance of sustainable mining in the jewellery industry.
How crucial is a long-term and steady supply of gemstones such as rubies, sapphires and emeralds to the jewellery sector?
Gilbertson: Significant improvements in the supply chain, especially in terms of reliability, consistency, and responsible and transparent sources of goods have instilled renewed confidence in rubies and emeralds, and enabled high-end jewellery brands to create extraordinary capsule collections that they would typically have spent years collecting.
The recent discovery of rubies in Mozambique in 2009 has been a real gamechanger. Mozambique has fast become the world’s number one ruby exporter, yielding record-breaking auction results for Gemfields.
Interestingly, people often forget that the well-known laws of supply and demand apply to “efficient markets,” a term that can’t yet be used in the coloured gemstone sector. Gemfields’ Kagem emerald mine in Zambia is a case in point: Today it produces an estimated 25 per cent of world emerald supply. Over the last decade, its production has tripled while prices have increased more than six-fold.
What is your take on responsible mining?
Gilbertson: We believe that gemstone deposits in Africa do not belong to large mining companies or to artisanal miners, but to the host country itself. It’s not a question of small or large-scale mining; it’s about how we act as custodians of a country’s natural resources, optimise the prices these goods can achieve, and ensure that the greatest proportion possible can be repatriated to the host country.
How does Gemfields work with African governments to promote sustainable mining?
Gilbertson: Gemfields owns 75 per cent of the Kagem emerald mine in Zambia and the Montepuez Ruby Mining in Mozambique. We work with local partners in both nations. For Kagem, we partner with the Zambian government through the Industrial Development Corporation.
Proceeds from all Gemfields auctions are fully repatriated to our ruby mine in Mozambique and our emerald mine in Zambia, with taxes due to the respective governments paid on the full sales price achieved at auction. Of the US$1 billion in total auction revenues generated by Gemfields since 2009, about US$200 million, or 20 per cent, was paid in taxes to the governments of Mozambique and Zambia. This means that those countries, for the first time, are receiving fair participation in their coloured gemstone resources.
We also work collaboratively with the governments and local communities around our mines to identify projects that enhance the lives of the local community with a focus on health, education and livelihood as well as supporting Africa’s rich wildlife through conservation efforts.