The president of Botswana has threatened to pull out of its partnership with Diamond company De Beers if the company refuses to renegotiate a larger share for the Southern African country.
Botswana will not back down from its demand for a larger share of the diamonds produced by its joint venture with De Beers, President of Botswana, Mokgweetsi Masisi said on Thursday, 9th Mar upping the stakes in negotiations to renew a sales agreement that ends in June.
Debswana, a joint venture owned equally by Botswana and De Beers, mines diamonds. De Beers buys three-quarters of Debswana’s output, which was 24 million carats in 2022.
The remainder is sold to the state-owned Okavango Diamond Corporation (ODC), which was established under the current sales agreement in 2011 as Botswana attempted to market jewels outside the De Beers system.
70% of De Beers’ raw diamonds come from Botswana. Last month, Masisi threatened to withdraw from discussions to extend the sales agreement unless Botswana received a higher portion of the joint venture’s output. He made no mention of the magnitude of the stake requested.
The president of the Southern African country told reporters on Thursday that the 54-year-old joint venture agreement had deprived Botswana of the ability to market its own diamonds.
“Besides the fact that the diamonds are ours, it doesn’t make sense for us to continue to relegate ourselves to participating in the rough space only. So, it’s only logical that we want more and we are going to get more. But through negotiation,” the president stated.
De Beers CEO Al Cook said he saw Masisi in Gaborone on Friday 19thmorning and had a “good talk” with the president.
“It’s very clear that, front and foremost in the president’s mind is the interest of the Botswana people. We as De Beers want to play our role in a strong, strategic partnership. I’m very confident that this partnership will go forward in a very good way,” the CEO disclose to reporters.
According to De Beers, the government of Botswana obtains more than 80% of Debswana’s profits, including taxes and royalties.
The Anglo American Plc (AAL.L) company, which also owns mines in Canada, Namibia, and South Africa, sold $4.3 billion in raw diamonds in 2022, a 13% rise over sales in 2021. ODC’s sales in 2022 were $1.2 billion, up from $963 million in 2021.
