14 November 2008
NAMDEB says the current global economic turmoil and downturn has affected the profitability of the company negatively.
Namdeb, a joint venture between the Namibian Government and De Beers, warned of a "challenging and unpredictable" diamond market in the year ahead.
In a cautiously grafted statement issued yesterday, Namdeb's Group Manager: External Affairs and Corporate Communication, Hilifa Mbako, said the company is already facing serious challenges, because of commodity prices that have fallen sharply.
This is coupled to a rapid decline in share prices of major mining companies.
Hinting at possible effects of the international economic slowdown on Namdeb's workers, Mbako said, the company's "actions will be taken in consideration of ensuring that the consequences of our decisions will have minimal impact on our employees, communities and the country at large.
He said all employees have been informed of the unpredictable global economic situations.
"We will continue to communicate through the appropriate Namdeb structures as this situation unfolds," Mbako assured the workers.
Referring to major jewellery consumer markets, Mbako said these are now in a recession, which is "likely to be deep and long".
Although saying that the impact will be short term, he said "our environment will continue to be challenging and unpredictable".
Mbako listed the challenges as consumers "probably" reducing discretionary spending, that would impact on jewellery sales, retailers reducing inventory levels and high debt levels in cutting centres affecting the cash-flow situation of the buyers of rough stones.
"We need to recognise that the world has changed around us and take action now to ensure we have a future."
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