DE BEERS has concluded negotiations on a new diamond sales agreement with the Botswana government, securing an extension of mining licenses until 2054, according to Reuters.
The deal, which is expected to be formally signed in the coming weeks, marks a milestone agreement between the two parties, reinforcing Botswana’s dominance in the global diamond trade.
‘The signing will be in the next few weeks… the government of Botswana will be hosting the signing,’ De Beers CEO Al Cook told Reuters in an interview on Monday.
Key terms of the agreement
The agreement builds on a 2023 deal that proposed gradually increasing Botswana’s share of diamond production from Debswana, a 50:50 joint venture between De Beers and the Botswana government.
Under the new terms, Botswana’s share of diamond production will progressively increase to 50 percent, enhancing the country’s control over its natural resources.
However, the deal was never officially signed under former President Mokgweetsi Masisi. The newly elected President Duma Boko, who took office in October 2024, has prioritised finalising the agreement swiftly.
‘The conclusion of the negotiations is in alignment with those agreed in 2023,’ De Beers said in a statement.
Botswana eyes greater stake in De Beers
In addition to the diamond sales deal, negotiations are ongoing for Botswana to increase its ownership stake in De Beers, which currently stands at 15 percent. President Boko has indicated that discussions are progressing positively, though no final agreement has been reached.
Botswana, the world’s top diamond producer by value, has been leveraging its strong negotiating position to secure greater economic benefits from its lucrative diamond resources.
Anglo American’s plans to divest De Beers
The finalised agreement comes amid broader restructuring efforts by De Beers’ parent company, Anglo American. The mining giant is seeking to divest De Beers to focus on its core operations in copper and iron ore.
According to industry sources, Anglo American is considering multiple options, including:
- A public listing of De Beers,
- A sale to a sovereign wealth fund,
- A strategic acquisition by another investor.
However, the potential sale comes at a challenging time for the global diamond market, with rough diamond prices down by approximately 20 percent since early 2023, according to the Zimnisky Global Rough Diamond Price Index.
The downturn has been driven by: the rise of lab-grown diamonds, shifting consumer preferences, particularly among younger buyers and global economic uncertainty impacting luxury markets.
Marketing shift: telling the Botswana diamond story
Despite declining diamond prices, De Beers remains confident that its partnership with Botswana will provide a competitive edge in marketing natural diamonds.
‘For the country of Botswana, we can open up a new marketing direction, which is to tell the origin story of the diamond,’ said Cook.
Botswana’s reputation for ethical diamond mining could help distinguish its gems from lab-grown alternatives, reinforcing their luxury appeal.
What’s Next?
With the diamond sales agreement finalised, the next steps include: official signing of the deal in Botswana, further negotiations on Botswana’s increased stake in De Beers and Anglo American’s final decision on the future of De Beers.
As the diamond industry continues to evolve, Botswana’s partnership with De Beers will play a crucial role in shaping the future of the global diamond trade.
Credit: Africabriefing
