Botswana and De Beers Finalize 10-Year Diamond Sales Agreement

Botswana and De Beers have secured a 10-year diamond sales agreement enabling Botswana to sell 30% of rough diamonds initially, increasing to 50% by 2035. This strategy aims to reverse the decline in diamond revenue. The deal is expected to foster stability in the diamond sector and is set to be signed by the end of February, with a potential for a five-year renewal.

Botswana has successfully concluded a significant 10-year sales agreement with the South African diamond company De Beers. This deal emerged after extensive negotiations that commenced in 2019. Initially, Botswana’s government will have the authority to sell 30% of the rough diamonds derived from their joint venture, with the provision for this percentage to rise to 50% by 2035.

The new agreement is anticipated to help address the decline in Botswana’s diamond revenue, which has decreased from $7 billion annually to $4.2 billion in 2023 due to falling global demand. Both De Beers CEO Al Cook and the World Diamond Council have expressed their approval of this arrangement, indicating a strong commitment to long-term stability within the diamond industry.

Botswana’s Minister of Minerals, Ms. Bogolo Kenewendo, indicated that the agreement will be officially signed before the end of February. Additionally, the deal includes an option for a five-year renewal upon its expiration, ensuring continued collaboration between Botswana and De Beers.

In summary, the finalized 10-year diamond sales agreement between Botswana and De Beers signifies a critical step towards enhancing Botswana’s diamond sales strategy. By allowing the government to sell a growing percentage of rough diamonds, this deal aims to stabilize and potentially increase revenue in the face of declining demand. With the backing of industry leaders and a structured renewal option, the partnership is poised for future success.

Original Source: www.africa.com