Is Botswana Getting A Raw Deal From De Beers Diamonds - The World News Exclusive -

To understand the current friction, one must look at the current sales agreement, set to expire soon. The prevailing myth is that Botswana (through its state-owned entity, Okavango Diamond Company) and De Beers are equal partners—a 50/50 joint venture known as Debswana.

Historically, Botswana's direct ownership in De Beers was just 15%, while mining conglomerate Anglo American held an 85% majority. Meanwhile, Botswana supplied approximately 70% of De Beers’ annual rough diamond production. This disparity led to widespread frustration. Proponents of a new deal pointed out several major sticking points:

The latest chapter in this partnership began with intense negotiations over a new sales agreement. The previous 10-year contract, signed in 2011, was extended multiple times due to the COVID-19 pandemic and complex discussions.

When factoring in taxes, royalties, dividends, and joint-venture profits, the government of Botswana retains an estimated 80% to 85% of the value generated by Debswana’s operations. Few mining nations achieve such a high percentage of resource rent retention. To understand the current friction, one must look

The fight is not over. By trying to buy a controlling stake in De Beers, President Boko is attempting to rewrite the resource story completely. He wants to turn Botswana from a landowner into a global powerbroker.

Historically, De Beers mined the rough diamonds in Botswana and shipped them to London, where they were sorted, aggregated, and sold to manufacturers. The high-value activities—sorting, cutting, polishing, and retail—happened elsewhere, keeping the bulk of the economic profit outside Botswana’s borders.

While the argument for a better deal is strong, the "raw deal" narrative has a flip side. De Beers provides more than just a checkbook. They provide the global marketing machine—the famous "A Diamond is Forever" campaigns—that sustains the value of the stones. The previous 10-year contract, signed in 2011, was

Consider this: A rough diamond dug in Botswana might be cut in Surat, India, polished in Antwerp, set in New York, and sold to a bride in Tokyo. Of that final retail price (which could be 5x to 10x the rough value), Botswana currently captures only the cost of extraction plus half the rough profit.

However, as the mines grow deeper and more expensive to operate—such as the massive underground expansion project at Jwaneng—the old model of simply taxing raw extraction is no longer sustainable.

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However, as the nation grew in political maturity and economic capability, questions began to arise regarding the equity of the arrangement. Was Botswana getting a raw deal? The Argument for a "Raw Deal"

However, experts point out the inherent contradiction: Botswana is investing in its own sales infrastructure while simultaneously agreeing to continue funnelling the bulk of its stones through the De Beers system. Further complicating this ambition are reports suggesting that De Beers executives remain resistant to allowing the ODC to host its own independent "sights" for buyers, preferring to keep the supply chain under their supervision. For a country that aims to become a global diamond hub, this represents a significant roadblock.

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This dynamic changed under the administration of President Duma Boko. A finalized, comprehensive 10-year sales agreement and a 25-year extension of Debswana’s mining licences through 2054 fundamentally altered the profit split: Latest Group news - De Beers Group