Zim records US$ 6,8bn forex earnings in 2019
BOTSWANA plans to conclude negotiations with De Beers on a diamond sales agreement by the end of April to replace the 10-year deal that expired last month.
The government wants to see more gems cut and polished within the borders of the world’s second-biggest diamond producer, creating jobs and boosting the state coffers, according to Lefoko Moagi, the minister of mineral resources, green technology and energy security.
An agreement is crucial for both parties. Botswana accounts for more than two-thirds of De Beers’ production, while the country relies on the gems for 90 percent of its exports and wants to derive as much benefit as possible from its mineral wealth.
“We are looking at April, not beyond, for all of this to happen and be successfully concluded,” Moagi said in an interview from his office in Gaborone, the capital.
“We now want further to move into the value space; the bottom end of the business, which involves your valuation, your pricing, cutting and polishing, marketing, selling and jewellery making.”
De Beers remains “fully focused on continuing to be a dedicated partner to the people of Botswana, and to delivering on our commitments,” the unit of Anglo American Plc said.
Botswana already owns 15 percent of De Beers and has a 50 percent stake in the Debswana mining company.
As part of the existing agreement, De Beers moved diamond sales to Botswana from London, and the government secured the right to sell 10 percent of Debswana’s production independently.
The talks take place as coronavirus hurts demand for commodities including diamonds. China accounts for about 14 percent of global consumption of polished gems, making it the biggest market outside the US, according to figures from De Beers.
“We are worried” about the potential impact on the diamond market,” Moagi said.
De Beers is monitoring the situation closely, and it’s too early to say what the impact on demand could be, the company said.
Gems worth $846 million exported in 2018 was dwarfed by the $5,1 billion of rough stones.
The landlocked southern African nation is one of Africa’s success stories, largely thanks to its diamonds and the prudent management of the resource.
At independence from Britain in 1966, Gross Domestic Product (GDP) per capita was $70, making it one of the world’s poorest nations.
Just 12 kilometres of roads were paved, according to the World Bank. By 2018, GDP per capita had climbed to $8,259, higher even than its more developed neighbour, South Africa.
Botswana now has 7 000 km of paved roads.
While the nation’s economy grew 3,5 percent in 2019 after averaging nearly four percent from 2016 to 2018, unemployment at 18 percent is still high, especially for youths, according to the African Development Bank.
The government wants to boost employment in the diamond sector through a new deal with De Beers said Moagi.
“What more really we need is to see jobs coming through, we want to see young people participating in these jobs,” he said. — Mineweb.
ZIMBABWE received US$6,8 billion in foreign currency receipts for the year ended December 31, 2019 with the bulk of the receipts coming from export proceeds, latest figures from the 2020 Monetary Policy Statement show.
This was, however, a 4,4 percent decline from the US$7,2 billion that was received in 2019.
Notably the biggest source of foreign currency declined after export proceeds decreased by 11 percent to US$3,9 billion from US$4,4 billion prior year comparative.
NGOs’ support was also nine percent lower to US$521 million from US$570 prior year comparative.
The country, however, got a boost after loan proceeds increased 12 percent to US$1,7 billion from US$1,5 billion prior year. The bulk of the loans were extended to the agriculture sector.
Diapora remittances increased marginally by 2,6 percent to US$635,4 million although market watchers suggests more could have come through informal channels.
A major worry is, however, the decline in Foreign Direct Investment (FDI), which comes at a time the country is making duce notes in larger denominations to improve efficiency and convenience to the public.”
The cash in circulation at the moment amounts to about 3,2 percent of total deposits. — New Ziana. efforts to attract investment into the country
According to the Central Bank, Foreign Direct Investment declined to US$259 million in 2019 from US$717,1 million in 2018.
Similarly, net portfolio investment inflows declined significantly from US$54,7 million in 2018 to US$3,7 million in 2019.
“The decline in both FDI and portfolio investment was, in large part, due to heightened perceived country risk,” said RBZ governor Dr John Mangudya.