Botswana Closes Landmark Diamond Sales Deal with De Beers

On Tuesday, the Botswana government finalised a landmark diamond sales agreement with De Beers, concluding seven years of negotiations in a deal set to reshape the country’s economy.

The agreement strengthens Botswana’s stake in diamond sales through Debswana, the joint venture between the government and De Beers, a subsidiary of Anglo-American. As the world’s leading diamond producer by value and the second-largest by volume after Russia, Botswana stands to gain significantly from this new arrangement.

Diamonds are the backbone of Botswana’s economy, accounting for about 80% of exports and nearly a quarter of the country’s GDP, according to the International Monetary Fund. However, a recent slump in diamond prices and demand has taken a toll, fueling economic uncertainty and becoming a major issue in last year’s national elections. The newly elected government, led by President Duma Boko, championed the deal as a critical step toward securing Botswana’s economic future.

Under the 10-year agreement, Botswana will receive 30% of Debswana’s diamond sales for the first five years, rising to 40% in the following five years. A potential five-year extension could eventually lead to an even 50-50 split. In return, De Beers has secured a 25-year extension on its mining licenses in Botswana, extending them from 2029 to 2054.

Botswana has been the location of some of the most extraordinary diamond discoveries in recent years. In 2023, Canadian mining company Lucara unearthed a staggering 2,492-carat diamond—the second-largest ever recovered and the largest in more than a century. In 2021, Debswana made headlines with a 1,098-carat diamond, its largest find to date. These discoveries have reinforced Botswana’s status as a global leader in diamond production.

AFRICANEWS/S.S