Friday, December 4, 2020

Botswana/De Beers Diamond sales deal…not yet Uhuru

While there has been so much talk on the imminent diamonds sales agreement between the Botswana government and De Beers Mining Company in the business corridors, there is less information to share at this stage.

The Botswana government, while admitting that the talks are due, has said that nothing official and concrete is on the table yet.

Cornelius Dekop – Permanent Secretary (PS) in the Ministry of Minerals Resources this week told a special committee of Parliament that some aspects of the discussions are yet to be finalized on the government side.

Dekop was however quick to mention that the Botswana government will negotiate in good faith for the benefit of the country.

While the diamond sales agreement is to be done with De Beers, Dekop said that the government will still have to explore all options as the matter is the back bone of the Botswana’s economy. It has previously been reported that the Botswana government is also considering engaging in talks with Russians should the De Beers agreement hit a snag.  

In the meantime, Dekop said that discussion between Botswana and De Beers remains confidential adding that he is also restricted from sharing the information by the stock exchange listing rules as some De Beers subsidiaries prohibit the sharing of market sensitive information. De Beers’s mother company ÔÇô Anglo American is listed in a number of stock exchanges across the globe.  Anglo American owns 85 percent of De Beers and the remaining is held by Botswana’s government while Debswana Mining is a 50-50 joint venture between the Botswana government and De Beers.

In May 2018, hardly a month after taking office ÔÇô the President Mokgweetsi Masisi hinted on the position of the government after he said it will push  for the industry to create more jobs and is “dead determined” that more diamonds be cut and polished in Botswana.

“We have had a wonderful relationship with De Beers and we expect that relationship to be even more cemented,” Masisi told Bloomberg in May 2018. “There is a way of actually achieving a win-win for both, and that’s what we desire.”

Presently, De Beers sells diamonds at invitation-only sights held 10 times a year at its offices in Botswana. The company sets the prices and its handpicked customers, known as Sightholders, are not able to negotiate.

RELATED STORIES

Read this week's paper

COVID-19 Money Lessons to Share with Kids (II)

At stated in the last edition, discussing money issues with our kids can be stressful, especially during this period. However, the good news is,...