Thursday, June 4, 2020

De Beers using Batswana as smokescreen

News that a senior executive who is a citizen of Botswana was recently fired by De beers after refusing to fudge and cook the figures relating to diamond beneficiation would come as a source of disappointment but not surprise for many people familiar with the history of De Beers.

As a company, it was only in the last few years that that De Beers announced reforms that would see the company put behind its checkered history and put in place new efforts to abide by good governance in all their business operations and dealings.

Judged by stories of how citizen employees are still treated, De Beers has still not fully succeeded in overcoming its past.

Botswana Government likes to talk of its partnership with De Beers as a boon.

In a way that is true.

But a large number of citizens who have come in direct contact with De Beers masters often speak a totally different, painful and unpleasant experience.

Botswana Government should make efforts to understand De Beers at both macro band micro levels.

At a macro level, it is known fact that De Beers only reluctantly and grudgingly accepted to the terms of the last Sales Agreement with Botswana Government that had relocation from London to Gaborone as its central feature.

In fact it is also an open secret at De Beers that the more than century old diamond juggernaut never forgave Botswana government for its steadfast demand for the relocation.

De Beers only gave in to the demand after it became clear that Botswana Government was quite willing, ready and determined to move on by way of looking for other potential partners if De Beers was not going to accede to demands to relocate to Gaborone.

It would seem like the real executives running De Beers are taking out these frustrations on citizens.

Admittedly, relocation was a big coup for Botswana Government.

But on its own, relocation was never going to be enough if its benefits did not cascade to micro levels. The biggest mistake that Botswana Government did following the gains it made at that last round of negotiations was to sit on the laurels and be too celebratory about potential benefits of relocation.

Yet years later, the gap between the Agreement as written on paper and the results as they manifest themselves on the ground should be a source of concern if not embarrassment for Botswana Government, especially as the same Government is once again on the verge of yet another round of negotiations with De Beers.

What Botswana Government needed to do following relocation from London was to continuously monitor that De beers was honouring its side of the bargain, especially that the cutting and polishing of rough was happening inside the country as the Agreement had envisaged.

According to the Agreement, these polishing factories have to cut at least 70 percent of their diamonds locally.

A strong sentiment from within the industry is that this has not been happening.

Yet instead of calling out these factories, De Beers is covering up for them, hence the sacking of an officer whose reports pointed out to these defects.

The sacking of the executive whose responsibility was to monitor that indeed cutting and polishing happened in Botswana is a clear example that De Beers cannot be taken at its word.

That it would be suicidal for Botswana to believe everything that De Beers says either ion meetings or in its reports without verifying.

All evidence points to the fact that since relocation, a growing number of polishing factories has been closing shop in Botswana.

It is important for Botswana government to understand why this is so, given the fact that Botswana had counted immensely on these factories in efforts to create employment and also maximize benefits from diamonds, especially the downstream side of the value chain.

De Beers, as it has done right from the beginning continues to take advantage of Botswana’s seemingly helplessness on operational matters.

At a practical level, De Beers literally gets away with murder. If there is one thing that De Beers is good at it has to be Public relations. When it comes to PR, De Beers is even better than diamond mining.

This ability has allowed the company to treat Batswana like some animated toys.

Recently the company paraded faces of several young Batswana women executives in full page spread adverts.

It was supposed to be a showcase of how the company is empowering women.

Yet in practical reality, these women, whose ability and talents are beyond reproach do not have any powers.

The power real power at De Beers continues to reside on faceless white executives many of them from the old era of the Oppenheimer families that many of us would best forget, where notwithstanding the publicly pronounced liberal outlook of this family, subtle racism reigned supreme.

This kind of tokenism, cannot be addressed by a Sales Agreement, not matter how well drafted.

Botswana government should demand that De Beers treats citizen employees with integrity.

It is not enough that De Beers employees are among the highest paid in the country when a senior employee from there can be sacked with a few lines letter without following due process and especially after they refused to do what could easily amount to criminality.

Currently Okavango Diamonds Company, a 100 percent Botswana Government owned company gets only 15 percent of Debswana rough.

There is no reason why this cannot be substantially increased under the new Agreement, especially in the face of efficiencies demonstrated by Okavango Diamonds against De beers.


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