Namibia's central bank governor Johannes !Gawaxab called on Wednesday for an extension to a royalty discount granted to Namdeb to help the diamond miner through a protracted global market downturn, marked by falling demand and a supply glut.

The rising popularity of lab-grown diamonds and a shift away from the precious stone among younger consumers are also weighing on rough diamond prices.

In 2021, Namibia cut its royalty rate from 10% to 5% until 2025 to help Namdeb, a joint venture between De Beers and the Namibian government, extend its land-based operations to 2042.

"It is important to support Namdeb during these difficult times," !Gawaxab said during a press conference after the central bank cut its main interest rate by 25 basis points to support Namibia's weakening economy.

"As a country, it is important we support not only the companies, but its employees as well," he added.

Extending the royalty relief would provide Namdeb with the necessary space to weather the economic storm currently sweeping through the diamond sector, he said.

De Beers argued at the time the discount was granted that, given the age of the mines, it was becoming difficult to maintain viable and profitable operations.

"Domestic diamond mining companies remain cash-strapped due to debt servicing obligations, falling revenue and key investments to enhance efficiency. As a result, the industry is facing headwinds in the medium-term," !Gawaxab said.