In a historic move poised to reshape the diamond industry, the Botswana government has signed a transformative 10-year sales agreement with De Beers, the world-renowned mining company. The deal, finalized on Tuesday after seven years of negotiations, marks a significant step forward for Botswana’s economy, which relies heavily on its diamond resources.
Under the new agreement, Botswana’s share of diamond sales through Debswana—a joint venture between the government and De Beers—will increase to 30% for the first five years and rise to 40% for the subsequent five years. The deal also includes an option for a five-year extension, during which the sales share will be split equally at 50-50. In exchange, De Beers has secured a 25-year extension to its mining licenses in Botswana, ensuring its operations will continue until 2054.
Botswana, a southern African nation known for its vast diamond reserves, is the world’s largest producer of diamonds by value and the second-largest by volume, trailing only Russia. Diamonds account for approximately 80% of Botswana’s exports and contribute a quarter of its GDP, according to the International Monetary Fund.
However, the country has faced economic challenges in recent years due to declining diamond prices and demand, which played a pivotal role in last year’s national election. The ruling party, in power since independence from Britain 58 years ago, was ousted in a dramatic shift largely driven by economic hardships tied to the diamond industry’s downturn.
Despite these extraordinary discoveries, the diamond market’s volatility has impacted Botswana’s economy. Debswana’s total sales for the first nine months of 2024 stood at
This new agreement not only strengthens Botswana’s economic footing but also underscores the enduring partnership between the nation and De Beers. As the diamond industry evolves, Botswana remains a key player, with its rich resources and commitment to sustainable growth continuing to shape the global market.
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