Namib Desert Diamonds spent over N$11 million on consultants last year

12 June 2018 2 min. read
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Having been in existence for less than two years, Namibian public sector entity Namib Desert Diamonds (Namdia) has already recorded a substantial sum of expenditure on consulting support, as is evident from its reports on the 2017 financial year. The company has spent over N$11 million just on consultants, which is nearly half of its total expenditure since it was established. 

Born out of a Sales and Marketing Agreement between the government of Namibia and the De Beers Group of Companies, Namdia was established in 2016 with the primary objective of providing a price discovery mechanism to the government. To this end, the firm trades rough diamonds to build a commercial space for Namibian diamonds in the global market. 

Much like most of Africa, mining constitutes a major part of the Namibian economy, and the country’s reserves of diamonds ensure that the segment remains a lucrative one. Nevertheless, the last half a decade or so has been a turbulent one for the mining industries, as global prices of precious materials and other commodities plummeted in 2014, and have subsequently fluctuated.Namib Desert Diamonds spent over N$11 million on consultants last yearIn addition, state-of-the-art technological applications have now made their way into the mining sector, which the bigger industrial players will adopt at the earliest, thereby putting the rest of the mining sector under substantial pressure. As a modern-day organisation revolving around the mining sector, Namdia is in a position to keep pace with these developments and remain abreast with developments in the industry.

Big Four professional services firm Deloitte, for instance, has developed the notion of a digital mine for the contemporary era, which is endowed with digitised geological detection and identification of mineral deposits, autonomous mining equipment, real-time data capture and feedback, alongside a number of other features.

In order to leverage these latest applications, while simultaneously implementing a complex business strategy, Namdia has required extensive consulting support. Within a year of its establishment (FY 2017), the entity recorded total expenditure of just over N$ 23 million, more than N$ 11 million of which was deployed towards the employment of consulting services.

The amount spent on fees for consulting firms is significantly higher than funds deployed elsewhere, such as emoluments for directors hat amounted to N$ 4 million, total overseas travel costs of N$ 2 million, and N$ 3.8 million spent on salaries for the entire period. The firm’s overall profits crossed N$ 62 million, while N$ 29.5 million was paid in taxes.