Botswana seeking a sparkling new De Beers deal

BOTSWANA’S President Mokgweetsi Masisi wants a new long-term diamond-sales pact with De Beers when the current 10-year deal expires in 2020 and for more gems to be processed locally.

The conclusion of an accord is crucial for both Botswana, which relies on diamonds for almost a fifth of its gross domestic product, and for the Anglo American unit that gets about two-thirds of its gems from the southern African nation.

Masisi, who is due to contest elections next year, is pushing for the industry to create more jobs and is “dead determined” that more diamonds be cut and polished in the country.

“We have had a wonderful relationship with De Beers and we expect that relationship to be even more cemented,” Masisi said in an interview at his office in Gaborone on Monday. “There is a way of actually achieving a win-win for both, and that’s what we desire.”

Botswana is the world’s biggest diamond producer after Russia, and most of its gems are mined by Debswana, a 50-50 joint venture between the government and De Beers. Anglo American owns 85 percent of De Beers, with Botswana’s government holding the balance. De Beers sells diamonds at invitation-only sights held 10 times a year at its offices in Botswana. The company sets the prices and its hand-picked customers, known as sight-holders, are not able to negotiate.

A former schoolteacher and vice-president, Masisi, 56, succeeded Ian Khama as the nation’s leader on April 1.

Masisi spoke in a boardroom on the third floor of the presidency’s unassuming offices in the capital, with his portrait and those of his four predecessors hanging on the wood-panelled wall behind him.

Masisi said preparations for the talks were at an advanced stage. – Bloomberg