Botswana Threatens to Walk Away from De Beers Deal

By John Jeffay / February 14, 2023 / www.idexonline.com / Article Link

(IDEX Online) - Botswana is threatening to walk away from its deal with De Beers unless it can agree "more favorable" terms.Both sides signed up to an agreement in 2011, whereby the government sells most of the country's rough production through Debswana, a 50-50 partnership with De Beers.But several attempts to renegotiate the deal have ended in failure.On Sunday Botswana's President Mokgweetsi Masisi (pictured) threatened to walk away from the deal unless De Beers agreed to more favorable terms."If we don't achieve a win-win situation each party will have to pack its bags and go," he told a rally of his ruling Botswana Democratic Party, according to an AFP news report.""We are upping the stakes because we want a larger share from our diamonds."The original agreement was that De Beers would sell 90 per cent of the country's diamonds and state-run Okavango Diamond Company would sell the remaining 10 per cent. In 2020 the split was adjusted to 75-25.Back in November 2022, the President slammed the Sunday Standard newspaper for running a story headlined "Masisi to ditch De Beers for Lucara and HB Antwerp?". It reported the Okavango Diamond Company (ODC), wholly owned by the Botswana government, was planning to sell its specials (+10.8-carats) to Canada-based Lucara and Belgian manufacturer HB Antwerp instead. De Beers and the Botswana government were unable to reach agreement on a new deal, but extended the existing deal until 30 June this year. At the time De Beers said: "Following further positive progress towards a new agreement being made in the first half of 2022, the two parties have agreed to the one-year extension to enable the finalisation of the ongoing discussions." We have approached De Beers for comment.

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