Is Botswana Getting A Raw Deal From De Beers Diamonds - The World News Online
De Beers has historically had the right to buy 100% of Debswana's production. Critics argue that De Beers then sells diamonds at higher prices through its global distribution network, leaving Botswana with only mining profits and taxes, not downstream margins.
While rough diamonds are now aggregated in Botswana, the local cutting and polishing industry struggles to compete with established hubs in India and Israel. Critics argue that De Beers protects its traditional supply chains, leaving Botswana with the low-margin work of sorting while high-margin manufacturing remains offshore. The "raw deal" narrative suggests that Botswana is doing the heavy lifting of extraction while the true wealth generation happens elsewhere.
But beneath the surface of this success story, long-standing grievances have festered. Critics have always pointed to a fundamental imbalance: Botswana supplies an astonishing 70% of De Beers' rough diamonds, yet until recently, it only owned 15% of the diamond giant itself. For many in Botswana, it was a partnership of unequals, where the country took the geological risk while the majority of the value flowed back to London and the Anglo-American shareholders.
Botswana's diamond stockpile swells as gem price slump persists - Reuters De Beers has historically had the right to
De Beers, now majority-owned by Anglo American, is resisting. They argue that the global diamond market is fragile. They claim that flooding a landlocked country with rough stones that cannot be sold for top dollar would destroy value. Privately, industry insiders admit that De Beers is terrified of a precedent. If Botswana takes control of its own supply, what stops Canada, South Africa, or Namibia from doing the same?
Following seven years of arduous negotiations, the two sides finally formalized a new, comprehensive agreement. The finalized contract addressed several of Botswana’s core demands:
In recent years, the Botswana government has taken steps to renegotiate its revenue sharing agreement with De Beers. In 2020, the government announced a new 10-year agreement, which includes a higher revenue share for the government and increased investment in local communities. Critics argue that De Beers protects its traditional
After years of threatening to walk away, former President Mokgweetsi Masisi and new President Duma Boko helped solidify a new agreement (finalized February 25, 2025) designed to address these concerns.
President Duma Boko has passionately argued for a majority stake, citing the profound injustice of a system where "De Beers gets 70% of its diamonds from Botswana, and we only own 15% of it". For him, buying the company is an act of economic liberation, a chance to seize control of the entire value chain from mine to market.
But a shadow looms over Gaborone. As the current sales agreement expires and negotiations for a new deal heat up, a critical question is echoing across the Kalahari: Critics have always pointed to a fundamental imbalance:
Historical context and the genesis of the partnership At independence Botswana was economically fragile, with limited infrastructure, human capital, and administrative capacity. The discovery of diamonds presented both opportunity and risk. The government’s initial negotiating position was weak—lacking technical expertise and facing a global industry dominated by De Beers’ marketing and distribution systems. In that context, the government negotiated a 50/50 joint venture (Debswana) rather than attempting unilateral extraction or an immediate nationalized industry. The deal offered Botswana immediate access to De Beers’ technical know-how, marketing channels, and investment capacity, and it guaranteed steady royalties and dividends.
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Under the new terms, Botswana has clawed back a larger share of the supply. For the first five years, ODC will sell 30% of Debswana’s output. In the second half of the decade, that figure rises to 40%. Furthermore, the deal stipulates that by the final phase of the contract in 2035, ODC’s share will eventually reach 50%.
As The World News understands it, the current negotiations are at a knife's edge. De Beers recently moved its rough diamond aggregation from London back to Gaborone—a major concession. But Botswana is holding out for the right to sell up to 50% of its own stones independently.
