Botswana and De Beers have signed an agreement to continue their prosperous diamond mining partnership, addressing concerns that the relationship was deteriorating. Under the new joint mining agreement, Botswana will immediately receive a 30 percent share of the rough diamonds extracted, up from the previous 25 percent. This share will further increase to 50 percent within the next ten years. The interim agreements were signed by a Botswana government official and the CEO of De Beers, solidifying the partnership that supplies De Beers with the majority of its diamonds and provides Botswana’s government with a substantial portion of its revenue.
The specific details of the deal are still being finalized, as confirmed by government officials and representatives from De Beers. However, one of the key concerns raised by the Botswana government regarding the diamond share in the joint mining venture has been addressed. Previously, Botswana received 25 percent of the rough diamonds, while De Beers claimed the rest. Now, Botswana’s share will immediately increase to 30 percent, with a future target of 50 percent within a decade.
In addition to the revised diamond share, De Beers has committed to investing up to $825 million over the next ten years to support the development of Botswana’s economy. The agreement also includes the establishment of a diamond trade academy within Botswana to provide training to local individuals in various skills related to the diamond industry, as confirmed by government officials.
Botswana’s government, the world’s second-largest diamond producer, considers these agreements a significant victory for the nation of 2.4 million people, asserting that they will help achieve long-term development goals. Lefoko Fox Moagi, the Minister of Minerals and Energy, expressed excitement about the transformative nature of these agreements during the signing ceremony, alongside De Beers CEO Al Cook. Moagi emphasized that the agreements align with the aspirations of the Botswana people.
Earlier this year, President Mokgweetsi Masisi of Botswana publicly criticized the De Beers deal, claiming that his country was being exploited. He demanded a higher share of rough diamonds, exceeding the previous 25 percent, and urged De Beers to invest in expanding other sectors of the diamond industry within Botswana, such as cutting, polishing, jewelry making, and retail sales.
Botswana’s officials aimed to secure a fairer deal and reflect a broader demand from African countries to maximize their benefits from natural resources, which historically have been prone to theft, corruption, and mismanagement.
According to Mr. Cook, Botswana government officials were clear about the need for De Beers to invest in sectors beyond diamonds and contribute to the knowledge-based economy while prioritizing the country’s people. He believes that the agreed-upon deal fulfills those requirements.
The government also announced the extension of the sales agreement, which determines how diamonds are allocated, until 2033. Separately, De Beers’s mining license was extended to 2054, ensuring the company’s long-term presence in the country.
While diamonds have undeniably transformed Botswana, making it an upper-middle-income country with substantial infrastructure and economic output, the World Bank ranks Botswana as one of the most unequal nations globally. Botswana citizens and government officials argue that they should benefit more from the diamonds found in their land to address persistent social issues.
