Botswana’s new president, Duma Boko, says he wants to conclude talks for a new sales pact with global diamonds giant De Beers as soon as possible.
De Beers, a unit of mining company Anglo American, last year agreed a new diamond sales pact, which would see the government’s share of diamonds from the Debswana joint venture gradually increase to 50% over the next decade. Debswana Diamond Company, equally owned by Botswana and De Beers, sells 75% of its output to De Beers.
Though the Botswana government and the country’s outgoing president, Mokgweetsi Masisi, touted the merits of the deal, it has yet to be signed.
Boko, who took office on Friday after an election that dealt a stinging defeat to Masisi’s party, said De Beers had been “considering walking away, not signing at all... (a) very dangerous position to be in as a country”.
“The relationship with De Beers could have been damaged by the way the negotiations were handled,” he said in a televised statement. “The first thing that needs to be done is to engage the other party.”
Boko said his new administration wants to speak to De Beers to understand its concerns.
“A proper negotiation involves compromise, where you get a bit of what you wanted, the other person gets a bit,” he said. “Then... you have a durable, sustainable agreement.”
In an emailed comment, a De Beers spokesperson said: “We will continue to work with Botswana’s government in support of shared objectives, as we always have.”
Anglo American is looking to divest from De Beers as part of a broader restructuring of its sprawling business. Masisi had said in July the Botswana government may raise its shareholding in De Beers from 15%.
Anglo American’s process could become easier now the election in Botswana has been concluded, diamond mining industry analyst Paul Zimnisky said.
“Diamonds by far represent the most important industry for Botswana, so this has to be one of the front and centre issues for the (new) president,” Zimnisky said. “I would expect to see progress on this front now.”
Diamond prices, like those of other luxury good, have been hammered by a slump in global demand. Sales of rough diamonds at Debswana fell about 52% in the first nine months of 2024, according to data released by Botswana’s central bank on Tuesday.
Last week, Botswana’s voters delivered a shock defeat to the party that has ruled them for nearly six decades, registering their anger over economic stagnation linked to a decline in the diamond trade, by handing victory to opposition party Umbrella for Democratic Change’s Boko.
Masisi on Friday conceded defeat after his Botswana Democratic Party (BDP) lost by a landslide for the first time in 58 years.
Diamonds by far represent the most important industry for Botswana, so this has to be one of the front and centre issues for the (new) president
— Diamond mining industry analyst Paul Zimnisky
In his first public remarks after being sworn in as the new president, Boko said he was humbled by the election outcome.
“I pledge with every fibre of my being that I will do everything I can, not to fail, not to disappoint, appreciating always the enormity of the responsibility bestowed upon me by the people of this republic. It is their government,” he said.
Analysts blamed mounting economic grievances, particularly among young people, for the downfall of the BDP, which has governed the Southern African state of about 2.5 million people since independence from Britain in 1966.
Botswana’s economy has largely depended on the export of diamonds.
“After 58 years in power (the BDP) didn’t have anything new to offer,” said analyst Ringisai Chikohomero of the Pretoria-based Institute for Security Studies.
The UDC, by contrast, put forward ambitious policy proposals, he said. It pledged to more than double the minimum wage, improve social services and create a more independent judiciary, among other measures.
The capital Gaborone was calm on Friday, with small groups of opposition supporters celebrating in the streets.
“I did not ever think I would witness this change in my life,” 23-year-old student Mpho Mogorosi said. "The BDP had stayed too long... and I am proud to be part of the people that removed them.”
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