Botswana and De Beers have finalized a 10-year diamond sales agreement that allows Botswana to sell 30% of rough diamonds initially, increasing to 50% by 2035. This aims to reverse declining revenues in diamonds, which dropped from $7 billion to $4.2 billion over recent years. The agreement has received positive feedback from industry leaders and will be officially signed by the end of February 2023.
Botswana and the South African diamond giant De Beers have successfully concluded a new 10-year sales agreement following extensive negotiations that commenced in 2019. Under this agreement, the Botswana government will have the right to sell 30% of the rough diamonds produced by their joint venture initially, with this share projected to rise to 50% by the year 2035. This strategic arrangement is expected to aid in reversing the trend of declining diamond revenues, which have diminished from $7 billion annually to $4.2 billion in 2023 due to waning demand for diamonds.
The new sales agreement has been positively received, with De Beers CEO Al Cook expressing support, and it has garnered commendation from the World Diamond Council as well. This reflects a renewed commitment to fostering long-term, stable partnerships within the diamond industry. Botswana’s Minister of Minerals, Bogolo Kenewendo, has indicated that the formal signing of the agreement is anticipated to take place before the end of February, with the potential for a five-year renewal thereafter.
In conclusion, the newly established sales agreement between Botswana and De Beers marks a significant development in the diamond industry. It aims to enhance Botswana’s share of diamond revenue and restore economic stability amidst declining profits. With future prospects for increased sales percentages, this agreement sets the stage for a renewed partnership and resilience in the face of global market challenges.
Original Source: www.africa.com
