A new chapter in Botswana’s diamond production was opened this week in Gaborone as De Beers group launched the first diamond aggregation activity outside of London in 80 years.
The historic development that is two months ahead of schedule marks the initial step of the migration of De Beers’ sales activities to Gaborone from the end of 2013 and is also part of the ten-year sales agreement between De Beers and Botswana government.
The process of aggregation, which involves the mixing of like-for-like diamonds from De Beers’ global production, is an integral part of De Beers’ business. It provides licensed diamond dealers- known as Sightholders, with supply consistency to enable them to plan their downstream business and commit to long-term investments in producing countries such as Botswana.
Minerals, Energy and Water Resources Minister, Ponatshego Kedikilwe says government is working on optimising the complete spectrum of trading, financial, logistical, security and tourism linkage opportunities that diamond beneficiation presents. “The diamond trading migration to Botswana ushers in a medley of skills transfer, economic empowerment, job creation and sustainable growth opportunities,” he said.
The direct supply of rough diamonds to local cutting and polishing factories and the State-owned Okavango Diamond Trading Company are intended to achieve the sustainable downstream industries that Botswana is targeting. The government will be buying 10% to 15% of the production of Debswana and selling those diamonds itself through the Okavango Diamond Trading Company as a verification exercise. “To us, that leverage is extremely important because we won’t be depending solely on De Beers to do the marketing,” Kedikilwe added.
With the establishment of De Beers’ aggregation in Botswana, it is anticipated that about $6 billion worth of diamonds will flow through the country. The aggregation activities will take place in the new purpose-built De Beers
facility housed within the DTC Botswana building. By the end of 2013, more than P170 m is expected to have been invested in the building for modifications and extensions.
The De Beers Group CEO, Philippe Mellier, added, “This is a proud day for De Beers. We have worked hard to bring the aggregation of our worldwide production to Botswana ahead of schedule. De Beers has always been committed to beneficiation in Botswana, but today, and over the next year, we will be changing our business to cement that commitment for the long term.
Mellier added that as De Beers shifts more and more of its sales operations to Botswana over the next year, the company would solidify the long-term future of the partnership and work to transform Botswana into one of the world’s leading diamond trading and manufacturing hubs.