Mining & Trade News

A Call for Pragmatic Reform in the Gemstone and Gold Subsectors

Introduction

The recent bans on the exportation of raw gemstones and other minerals — most notably the 12 February 2025 directive — have reignited debate across Malawi’s mining sector. While the government’s stated goal is to promote value addition and maximize domestic beneficiation, the practical realities show unprepared systems, limited capacity, and unintended harm to the Artisanal and Small-Scale Mining (ASM) subsector.

Emotion Over Evidence:

The Gemstone Dilemma

When the export of raw gemstones was prohibited, the aim was to push for local processing and job creation. However, the implementation was reactive, with limited sector consultation and little recognition of the technical, financial, and structural readiness required. The September/October 2025 extension of this ban to all unprocessed minerals deepened the crisis, especially within a gemstone value chain that is fragile but full of potential. A few small processors and entrepreneurs - myself included - have demonstrated that value addition does pay off, through better prices, job creation, skill development, and increased credibility in international markets. However, challenges persist, including:

•  Lack of cutting, polishing, and grading   equipment.
• Shortage of skilled gem cutters and   valuers.
• Absence of gemstone certification and   regulatory standards. Unstructured markets with limited local   demand. Irregular production that impedes   consistent supply.

The True Art and Science of Gem Valuation

It is important to understand that gemstone processing and valuation go beyond mere cutting or polishing. The value of a gemstone reflects a combination of qualitative factors, including rarity, origin, market and fashion trends, craftsmanship, historical significance, and certification through credible laboratories.

“In today’s global gem trade, trust is the new market currency.”

Unfortunately, Malawi currently has very little of that trust due to inconsistent systems and the absence of internationally recognized certification mechanisms.

Tikuyenera kudekha komanso kuyika ndondomeko zoti zitipititse patsogolo komanso kupindulira dziko — surely not khambakamwa ayi!

We must be patient, structured, and deliberate if we truly want to position Malawi as a credible player in the global gemstone arena.

A Needed Reality Check: Credibility and Global Perception

Let us be honest with ourselves — at times, we have become a laughing stock in the global gemstone community. Having been privileged to work with world leaders in the ethical gemstone trade and as part of the Ethical Gem Show and Chicago Jewellery Transformative Family through my work with Virtu Gem (USA), I have seen firsthand how credibility, transparency, and responsible partnerships define market success.

The ongoing Columbia Gem House (CGH) case — involving Malawi’s purported $309 billion claim — illustrates serious misunderstanding of global gemstone market realities. Consider that Gemfields, the world’s leading ruby producer, has generated around $1 billion in revenues over 13 years — roughly 70% of global premium ruby output. The total global ruby and emerald market is estimated at just $1–2.5 billion per year, making Malawi’s claim economically implausible.

This lawsuit risks damaging our global reputation before we have even established a significant presence. My sincere advice to government is simple: engage, not antagonize. Build bridges with global players like CGH — they bring expertise, ethics, and access to high-value markets, particularly the U.S., the world’s largest gemstone destination. Sustainable value addition is impossible if we isolate ourselves from such critical relationships.

A Smarter Approach: Capacity Before Control

Rather than an outright export ban, Malawi needs a tiered policy approach. Institutions like the Export Development Fund (EDF) could lead gemstone processing initiatives and training programmes while ASMs continue limited exports under transparent frameworks. That way, we promote structured growth rather than pushing small miners into survival mode. Ultimately, the growth of this subsector hinges on building trust, technical expertise, and internationally recognized systems — not blanket prohibitions.  

The Gold Story: Policy Contradictions and Missed Lessons

Parallel to gemstones, the gold business in Malawi has experienced rapid growth. Reports indicate over 90 gold hotspots, with estimated daily output of around 10 kilograms. Through the EDF, the Reserve Bank of Malawi (RBM) has positioned itself at the center of domestic gold trading since 2021, reportedly acquiring about 500 kilograms in total.

However, these official figures raise concerns. Either production estimates are inflated, or significant quantities of gold are being traded illegally, as RBM’s buying prices cannot match parallel market rates.

Adding to the confusion, gold has been removed from the Reserved Mineral Licence (RML) framework - effectively stopping licensed dealers from trading in gold to “protect” RBM from competition - while the same bank buys from unlicensed miners. This contradiction undermines formalization, transparency, and investor confidence.

No genuine investor - local or foreign - will commit to gold mining when they cannot export or access foreign currency. Our policies, though well-intentioned, may be chasing capital out of Malawi instead of attracting it.

Towards a Formalized Gold Economy

Malawi can learn from models such as Tanzania, whose smart regulation and government-private cooperation have turned gold into one of its major forex earners. Malawi should:

1.  Reinstate gold under dealer licences  (RMLs) for structured private sector   participation.
2. Enforce a partial retention scheme,  requiring that 20% of gold be sold to RBM before export — balancing national interest and market freedom.
3. Establish licensed gold markets in all  major hotspots in collaboration with  Federation of Artisanal and Small-scale  Mining in Malawi (FASMIM), Mining and Minerals Regulatory Authority (MMRA), Reserve Bank of Malawi  (RBM), Malawi Revenue Authorit  (MRA), and local councils.
4. Implement a robust certification and  traceability system for legal sourcing. 
5. Adopt digital oversight tools rather  than over-policing artisanal players.

If managed effectively, gold could easily contribute 40–50% of Malawi’s foreign exchange earnings, making it one of the country’s strongest economic levers.

“We need systems, not suppression — structure, not reaction. The potential is clear if only we let capacity lead policy.”

Building the Foundation: Systems that Work

Both the gemstone and gold subsectors require deliberate, systemic reform. Moving forward, Malawi should:

• Establish training and processing   centers for gemstone cutting, polishing,   and gold refining.
• Promote Public–Private Partnerships  (PPPs) to build value-addition facilities  and markets.
• Create a Gemstones & Precious Metals   Certification Authority aligned with   international industry standards.
• Transition policies gradually, engaging   stakeholders throughout the process.
• Encourage research, innovation, and   global partnerships to strengthen   confidence and credibility.

Conclusion

Malawi’s mineral wealth can transform lives and drive structural industrialization — but only through credible systems, realistic policies, and collaborative leadership. Emotion-driven bans may appear patriotic, but they risk killing opportunity and trust. We must invest in skills, certification, and partnerships, grounding policy in practicality rather than passion. That is how Malawi can move from being a reactive observer to a respected participant in the global gemstone and gold trade.

Leave a Comment

Comments