Is Botswana getting a raw deal? Not compared to most resource-rich nations in Africa, which often see zero benefit from their minerals. Compared to the theoretical ideal鈥攚here a nation owns 100% of its resources and the downstream value chain鈥攜es, Botswana is leaving billions on the table.
The coming months are critical. If Botswana secures a deal that gives it control over independent sales and a higher percentage of rough stones, it will set a new precedent for global resource nationalism. If it caves, the "gold standard" might start to look a little tarnished.
For now, Gaborone holds the cards. The question is whether De Beers is willing to pay the price to keep them.
What do you think? Should resource-rich nations control their own diamond destiny? Join the conversation in the comments below.
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Is Botswana getting a raw deal? In the strictest financial sense regarding value addition and downstream integration, the answer has historically been yes. The nation has been a passive supplier of raw wealth rather than an active participant in the luxury market.
However, the definition of a "raw deal" is changing. Botswana is no longer the fledgling nation of 1966; it is a sophisticated economic player demanding its rightful share of the value chain. The current negotiations are not just about royalty percentages; they are about the soul of the industry.
If De Beers accedes to Botswana鈥檚 demands for more local processing and greater supply control, the "partnership" will finally evolve into equality. If they resist, Botswana may well decide that the "raw deal" is no longer a deal at all.
Is Botswana Getting a Raw Deal From De Beers? For decades, the partnership between Is Botswana getting a raw deal
and De Beers was hailed as the ultimate success story in African mining
. But as the global diamond market shifts, the question of whether Botswana is getting its fair share has moved from boardroom whispers to front-page news. The Changing Power Balance
Historically, De Beers controlled the lion's share of production, but the tide is turning. Under the new 10-year sales agreement signed in February 2025 , Botswana has secured a much larger "slice of the pie": Production Share: Okavango Diamond Company (ODC) 鈥擝otswana鈥檚 state-owned seller鈥攏ow starts with Debswana鈥檚 production, a significant jump from the previous 25%. Future Growth: This share is scheduled to climb to by 2033, effectively giving Botswana equal selling power. Development Funding: De Beers has committed up to 10 billion Pula ($712 million)
to a "Diamonds for Development" fund to help diversify Botswana鈥檚 economy. Why "Raw Deal" Talk Persists
Despite these gains, critics and local leaders argue the nation remains vulnerable:
Botswana has finalized a new 10-year, 25-year mining licence agreement with De Beers, aiming to boost its share of rough diamonds through Okavango Diamond Company to 50% by 2035. While the agreement strengthens local control and extends mining operations to 2054, the country still navigates an economic slump driven by falling diamond sales and rising inventory. For more details, visit De Beers Group AI responses may include mistakes. Learn more
If Botswana were getting a truly raw deal, we would expect to see underfunded hospitals and crumbling roads. Instead, we see modern infrastructure and universal education. The revenue from diamonds funds 50% of Botswana鈥檚 budget.
But the "raw deal" isn't about poverty鈥攊t's about lost opportunity. Follow The World News for ongoing coverage of
Consider this: A rough diamond dug in Botswana might be cut in Surat, India, polished in Antwerp, set in New York, and sold to a bride in Tokyo. Of that final retail price (which could be 5x to 10x the rough value), Botswana currently captures only the cost of extraction plus half the rough profit.
President Masisi has drawn a hard line in the sand. He isn't asking for a revolution; he is asking for evolution. He wants:
Another friction point is the financial structure of the agreement. Under the current deal, Botswana sells 75% of Debswana鈥檚 output to the Okavango Diamond Company (a state-owned entity), while De Beers takes the remaining 25%.
However, analysts point out that De Beers pays royalties and taxes that are competitive, but perhaps not maximized for the producer's benefit. As the global diamond market fluctuates and synthetic (lab-grown) diamonds threaten natural prices, Botswana is seeking to secure a higher "floor" price or a larger volume allocation to sell independently. By relying heavily on De Beers' marketing machinery, Botswana arguably remains a tenant in its own house, renting out its soil rather than truly owning the product.
Today, the argument that Botswana is being shortchanged rests on three primary pillars:
1. The Value of the "Run-of-Mine" Sales The current agreement allows De Beers to market the majority of Debswana鈥檚 production. The government has argued that the fees and royalties they receive do not reflect the true market value of the stones, especially as De Beers rebrands itself towards "ethical" and "conflict-free" diamonds. Botswana鈥檚 President Mokgweetsi Masisi has been vocal about this, suggesting that Botswana deserves a larger share of the pie because the diamonds are the foundation of De Beers' global reputation.
2. Beneficiation Limitations 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.
3. Market Dynamics and Monopoly Power For decades, De Beers held a near-monopoly on global diamonds. Today, that monopoly has eroded due to the rise of synthetic (lab-grown) diamonds and competition from Russian giant Alrosa. As De Beers鈥� market power wanes, Botswana is re-evaluating its reliance on the company. Some analysts argue that De Beers needs Botswana鈥檚 high-quality gems more than Botswana needs De Beers, and the current contract does not reflect this shifting leverage. polished in Antwerp
The current renegotiation is arguably the most significant in the partnership's 54-year history. Botswana鈥檚 President, Mokgweetsi Masisi, has taken a hardline stance, suggesting the government could walk away if terms do not improve.
Why the aggression now? Because Botswana finally has leverage. De Beers' supply from other major sources, like South Africa and Canada, has dwindled. Furthermore, sanctions on Russian diamonds (Alrosa) have tightened global supply. Botswana is currently the world鈥檚 largest producer of diamonds by value. Without Botswana鈥檚 output, De Beers would struggle to maintain its dominance in the market.
To understand the current friction, one must look at the current sales agreement, set to expire soon. The prevailing myth is that Botswana (through its state-owned entity, Okavango Diamond Company) and De Beers are equal partners鈥攁 50/50 joint venture known as Debswana.
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鈥檚 rough diamonds were sold exclusively through De Beers鈥� London-based sales arm. Botswana got 50% of the mining profits, but De Beers captured the margin on sorting, valuing, and global distribution.
The result is a lopsided dependency. Botswana鈥檚 economy is a diamond monolith鈥攔oughly 30% of its GDP, 50% of government revenue, and 80% of its exports are tied to these stones. When De Beers decides to flush the pipeline or lower prices, Botswana bleeds.
De Beers argues that the partnership is symbiotic. They claim that without their global branding (the "Forevermark" and "A Diamond is Forever" campaigns), Botswana鈥檚 diamonds would be commoditized and lose their premium value. They also note that they have already ceded ground, allowing the ODC to sell 25% of production independently.
"If Botswana pushes too hard," warns one mining analyst, "De Beers might divert capital to newer discoveries in Canada or Angola. You don't kill the goose that lays the golden egg鈥攂ut you also don't let the goose starve the farmer."