De Beers Finalize Diamond Agreement with Botswana

February 27, 2025

(3 Minutes Read)

This new deal enhances the government’s stake in diamond sales through Debswana, the joint venture with De Beers, a subsidiary of Anglo-American.

The Botswana government finalised a significant diamond sales agreement with De Beers. It marked a pivotal moment for its economy after seven years of negotiations. This new deal enhances the government’s stake in diamond sales through Debswana, the joint venture with De Beers, which is a subsidiary of Anglo-American.

The agreement is expected to bolster Botswana’s economic landscape, as the nation is recognised as the largest producer of diamonds by value and ranks second in volume, following Russia. Diamonds play a crucial role in Botswana’s economy, contributing approximately 80% of the country’s exports and accounting for a quarter of its GDP, as reported by the International Monetary Fund. However, the recent downturn in diamond prices and demand has severely impacted the economy, becoming a focal point during last year’s national elections.

The newly established 10-year sales agreement stipulates that the government will receive a 30% share of Debswana’s sales for the first five years, increasing to 40% in the subsequent five years, with a potential five-year extension that could lead to a 50-50 split. In exchange, De Beers has secured a 25-year extension of its mining licenses in Botswana, extending from 2029 to 2054.

President Duma Boko, who took office following the recent elections, emphasised the importance of this agreement, expressing confidence in its potential to foster a prosperous future for Botswana.