Botswana Wants Local Supply As Jwaneng Talks Drag On

As Debswana got word that the Jwaneng diamond mine license will be extended a few months, Botswana ministers say that negotiations are not over yet, and would like to see the country gain more from the diamond trade now that they know more about it. As negotiations are continuing for longer then expected, the Jwaneng diamond mine will continue to be operated by Debswana, said Akolang Tombale, permanent secretary in the Ministry of Minerals, Energy and Water Affairs, in an apparent move to allow mining to continue until negotiations are concluded.

“We have extended the current license to the end of the year,” Tombale told the SAPA news agency, referring to the world's richest diamond mine. But he refused to comment on speculation that the government is pressuring Debswana to promote local downstream initiatives.

“Cutting and polishing of diamonds is within our program,” said Finance Minister Baledzi Gaolathe. “This need not be done by Debswana, but other companies in Botswana. We would like to see De Beers and Debswana facilitating the supply of diamonds to the companies we may attract to cut and polish here.”

And that is the point - Botswana wants local supply, the one thing that De Beers does not want to give. From Canada to South Africa, De Beers, which owns 50 percent of Debswana, is finding this a growing demand that is difficult to resist. These problems are compounded by Israeli diamond magnate Lev Leviev’s recent moves in Africa, including the opening of local polishing plants and other downstream partnerships amid great fanfare, that have put De Beers’ unwillingness to follow suit firmly in the spotlight.

African ministers have severely criticized De Beers’ stand in recent weeks. In July, it was an Angolan minister and other officials speaking at a rough conference in Israel, while a week before that it was the Namibian Prime Minister, and now Finance Minister Gaolathe is adding his comments. “Obviously when we started mining diamonds, we did not have all the facts about the ore body, prices, etc. but we are more educated now. Our technological knowledge has improved,” Gaolathe was quoted as saying.

As negotiations take place “all these things will be taken into account, maybe some may no longer be relevant - maybe there will be other challenges. My hope is that, as in the past, there will be give and take and goodwill. A 25-year mining lease is a major privilege and there must be commensurate benefits flowing to the government.”