(IDEX Online News) – South Africa's State Diamond Trader made a loss of almost $200,000 in the financial year to March and is expecting a loss of more than $1 million for the 2014 financial year, the state-run body told MPs.

 

MP Kennett Sinclair, a member of the select committee on economic development, said the reports by the trader’s officials were of concern.

 

“Serious red flags need to be raised in terms of the sustainability and profitability of the public entity, which is supposed to be a catalyst for transformation and growth of the local diamond beneficiation industry,” Sinclair said, as cited by Business Report.

 

The issue of skills transfer through in-house training was a serious challenge, with only four trainees out of a target of 100 currently with the trader, MPs heard.

 

The SDT's sales dropped to $29 million in fiscal 2013 from $45 million in 2012 while fiscal year 2014 sales are forecast at $34.5 million.

 

The SDT's mission is to promote the growth of the country's diamond beneficiation industry through equal access to rough diamonds. By law, the SDT may purchase up to 10 percent of the run of mine production from all diamond producers operating mines in South Africa.