Botswana’s President Mokgweetsi Masisi warned on Sunday that if discussions to renegotiate a sales agreement fail, his country may cut ties with diamond giant De Beers.
The country is Africa’s top diamond producer, and Masisi has urged the public to rally behind his government as it seeks a better deal.
A 2011 sales agreement controlling the selling of diamonds produced by Debswana — a 50-50 joint venture between the government and De Beers that sells off the majority of the gemstones — was slated to expire in 2021.
The parties agreed to extend it until June 30, 2023, citing the epidemic of coronavirus as the cause for the delay in concluding negotiations.
“If we don’t reach a win-win situation, each party will have to pack their bags and leave,” Masisi warned at a rally for his ruling Botswana Democratic Party (BDP) in his home village of Moshupa, about 65 kilometres (40 miles) from Gaborone.
Masisi said he was kicking off the campaign for the 2024 legislative election, and that Botswana was up against a “Goliath” in the negotiations.
De Beers sold 90% of the diamonds under the 2011 agreement, while Botswana auctioned 10% through its Okavango Diamond Company. Botswana’s participation was increased to 25% in 2020.
“We acquired insight into how the diamond market works, and we learned that we were receiving less than what we should have,” said Masisi, who spoke in both English and Tswana.
“We also realised that our diamonds are producing a lot of profit and that the (2011) deal had not been advantageous to us”.
“We’re raising the stakes because we want a bigger cut of our jewels. “It can’t go on as usual,” he cautioned.
Yes, De Beers is actually regarded as a luxury brand. Most people identify a luxury jewellery brand as one that creates pieces from high-quality gemstones and precious metals and charges a premium for them. This definition applies to De Beers.
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