The recent agreement signed between the government and De Beers, the renowned diamond mining company, has been widely regarded as a significant milestone for the country.
This deal promises to bring additional revenue, technological advancements, and employment opportunities, offering numerous benefits to the nation.
During a press conference held in Gaborone, Minister of Minerals and Energy, Mr Lefoko Moagi, highlighted the key aspects of the new Sales Agreement.
According to the agreement, the Okavango Diamond Company (ODC), wholly owned by the government, will now receive 30 percent of Debswana’s production, a joint venture company between De Beers and the government, as opposed to the previous allocation of 25 percent.
Mr Moagi emphasized the government’s commitment to enabling its citizens to have access to these valuable resources, which influenced the decision to increase the allocation.
Initially, the ODC was granted 15 percent, and over time, this percentage has gradually risen to 25 percent.
As per the new 10-year agreement, the ODC will eventually receive 50 percent of the production by the agreement’s conclusion.
Notably, the new agreement allows the ODC to independently sell its production to De Beers’ clients, known as sightholders.
Mr Moagi emphasized that the ODC is now responsible for developing its own client base, moving away from solely relying on De Beers for sales.
To enhance sales operations, the ODC will introduce contracts and spot sales, departing from the previous practice of conducting auction sales that did not guarantee consistent sales.
Mr Moagi stressed that the ODC would create its own price book, as De Beers has its own, asserting the country’s right to determine how its diamonds are sold without being bound by De Beers’ price book.
In addition to diamond sales, Mr Moagi highlighted another crucial aspect of the agreement: the establishment of the Diamond Capital Fund.
He clarified that this fund goes beyond being a Corporate Social Responsibility (CSR) initiative. It will serve as a financial resource for projects in agriculture and energy sectors, managed collaboratively by both parties and eventually handed over to the government.
