For decades, the relationship between the government of Botswana and the diamond giant De Beers has been touted as the poster child for resource management in Africa. It is a narrative of partnership: Botswana provided the geology, De Beers provided the expertise, and together they transformed one of the world’s poorest nations into a stable, middle-income democracy.
"The balance has shifted," says Thabo Mokoena, an economist at the University of Botswana. "De Beers still controls the sightholder list—the exclusive buyers. Botswana provides the rocks, but London decides who buys them. In an era where diamond prices are crashing, that control means everything." For decades, the relationship between the government of
Reporting from Gaborone, The World News. Botswana’s long partnership with De Beers delivered major
Botswana’s long partnership with De Beers delivered major national benefits, but structural asymmetries, opacity, and dependence on a volatile market created real risks. Recent contract changes give Botswana more direct sales power and scope to capture value, yet global market shifts mean increased bargaining power does not automatically translate to higher revenues. Whether Botswana is “getting a raw deal” depends on ongoing transparency, how effectively it converts larger sales shares into better net prices, and its success diversifying and building downstream value. and global distribution.
Another friction point is the financial structure of the agreement. Under the current deal, Botswana sells 75% of Debswana’s output to the Okavango Diamond Company (a state-owned entity), while De Beers takes the remaining 25%.
The conflict came to a head this spring. Botswana’s President Mokgweetsi Masisi demanded that state-owned Okavango Diamond Company be allowed to sell 50% of the local production independently, bypassing De Beers’ London sorting room. De Beers countered with an offer of 30%.
On paper, that is true. Debswana mines the diamonds. But here lies the rub: De Beers controls the sight . For decades, virtually all of Botswana’s rough diamonds were sold exclusively through De Beers’ London-based sales arm. Botswana got 50% of the mining profits, but De Beers captured the margin on sorting, valuing, and global distribution.