Zambia has reinstated a 15% export duty on emeralds, effective 1 January 2025, reversing its 2019 suspension of the levy. The reintroduction aims to bolster government revenue from the gemstone sector, a significant contributor to the nation’s economy.
The 15% export duty was initially imposed in January 2019 to increase state earnings from the mining industry. However, it faced criticism for potentially deterring investment and hindering the competitiveness of Zambian emeralds in the global market. In response, the government suspended the duty in January 2020 to stimulate growth and attract foreign investment in the gemstone sector.
Gemfields, a leading producer of coloured gemstones and operator of the Kagem emerald mine in Zambia, has expressed concern over the duty’s reinstatement. The company, which owns 75% of Kagem in partnership with the Zambian government holding the remaining 25%, fears that the renewed levy could adversely affect the industry’s sustainability and its appeal to investors. In 2023, Kagem contributed approximately 31% of its revenue to the Zambian government through mineral royalties, corporation tax, and dividends. Between 2009 and 2023, the mine reported cumulative emerald sales revenue of $1.1 billion.
The reintroduction of the export duty places Zambian emerald exporters at a competitive disadvantage compared to producers in other countries. For instance, in 2019, it was reported that exporters in Colombia and Brazil faced lower export duties of 2.5% and 2%, respectively.
The Zambian government has not yet provided detailed reasons for reinstating the export duty. However, it is likely part of broader efforts to increase national revenue from natural resources. The impact of this policy change on the gemstone sector’s growth and investment attractiveness remains to be seen.
Industry stakeholders, including Gemfields, are expected to engage with the government to discuss the potential implications of the export duty and explore avenues to mitigate any negative effects on the sector. The outcome of these discussions will be crucial in determining the future trajectory of Zambia’s emerald industry and its position in the global market.
