An agreement in principle has been reached between Botswana’s government and one of the world's leading diamond companies, De Beers. According to a joint communique released on June 30 by the country's government and the diamond group, the agreement covers a new 10-year sales contract for the production of rough diamonds and new 25-year mining licenses until 2054.
"The transformational new agreements between Botswana and De Beers reflects the aspirations of the people of Botswana, propels both Botswana and De Beers forward, and underpins the future of their Debswana joint venture through long-term investment," the statement reads.
The country's president, Mokgweetsi Masisi, commented on the development on Twitter by saying "Done Deal!" and thus made the agreement public.
Distribution of Shares
Botswana's authorities and De Beers said they were still working out the details of the deal. It was noted that a tentative deal between the parties will preserve the terms of the most recent sales agreement, which expired on 30 June.
As it stands under the last agreement, Botswana's state-owned diamond trader received 25% of the rough stones mined in a joint venture with De Beers, which kept the remaining 75%.
This unit generally accounts for about two-thirds of the group's annual production. According to the government, as the agreement is still an interim one, there is a possibility that the share will eventually increase to as high as 50%.
Earlier, Mokgweetsi Masisi criticized the partnership with De Beers, highlighting that his country would never back down on demands for an improved deal. According to the president, the government is not going to afford other countries to "get rich" at the expense of the nation, "leaving us in poverty."
De Beers, owned by the UK’s Anglo American holding company with operational headquarters in South Africa, has been active in Botswana for more than 50 years.