Botswana, De Beers finalises diamond sales agreement
The government of Botswana has finalized transformative diamond sales agreement with De Beers. Under the new deal, Botswana’s portion of diamonds from Debswana, a joint venture between the government and De Beers, will rise from 25% to 50%. Additionally, Botswana will receive $712 million in development funding as part of a 10-year arrangement initially outlined in 2023.
Mining license extension
The agreement also grants Debswana an extension of its mining licenses until 2054, replacing the previous expiration date of 2029. Negotiations for the deal had been ongoing since 2018 but gained momentum after President Duma Boko, who took office in October, made it a priority.
Botswana, recognized as the world’s leading producer of rough diamonds by value, heavily relies on the industry for national revenue. However, President Boko has raised concerns about limited job creation within the sector. Although diamond production accounts for 80% of the country’s exports, economic diversification efforts have struggled to gain traction. Despite a relatively high per capita income of $7,820—higher than that of South Africa and Gabon—employment opportunities remain scarce.
The deal also comes as Anglo American explores options for De Beers, including a potential sale or stock market listing. Analysts caution that weak global diamond prices could present challenges to such a move. Botswana remains a critical supplier for De Beers, contributing 70% of its rough diamonds annually. Additionally, the government maintains a 15% stake in De Beers, emphasizing the long-standing strategic relationship between the two parties.
