De Beers committed to investing up to $750 million over the next decade into a fund designed to diversify Botswana's economy, focusing on non-diamond sectors like agriculture, tourism, and technology.
The "aggregation" process, where Botswana’s high-quality stones are mixed with lower-quality stones from other De Beers mines (like those in Canada or South Africa), might dilute the premium price Botswana should receive. The Burden of Diversification
Arguments that Botswana might be getting a raw deal
While this sounds like progress, it fell short of earlier expectations. The provisional "Heads of Terms" agreed to in 2023 suggested ODC’s allocation would hit 50% far sooner. The final 2025 deal sets a more conservative target. Furthermore, in exchange for a modestly increased share of the stones, Botswana agreed to lock in De Beers as the operator and primary marketer for the next three decades. De Beers committed to investing up to $750
The relationship between Botswana and De Beers, a multinational diamond mining company, has been a long-standing one. For over 50 years, De Beers has been mining diamonds in Botswana, generating significant revenue for both the company and the government. However, there have been concerns raised about whether Botswana is getting a fair share of the revenue generated from its diamond resources.
Selling diamonds is not as simple as digging them up. De Beers possesses a century-old, hyper-sophisticated global marketing and distribution network. By demanding a 50% share for the state-run ODC, Botswana must now rapidly scale up its own marketing capabilities. If the global diamond market faces a downturn—as it currently does due to macroeconomic headwinds and lab-grown competition—ODC may struggle to shift its inventory, leaving Botswana’s national budget exposed to severe cash flow shortages. The Burden of Capital Expenditure
The central argument for Botswana getting a "raw deal" revolves around value addition. The provisional "Heads of Terms" agreed to in
Under the terms of the agreement, De Beers pays the government of Botswana a royalty of 10% on the value of diamonds extracted from the mines. However, critics argue that this royalty rate is too low, and that the government of Botswana is not getting a fair share of the revenue generated by the diamond industry.
According to a 2023 report, under the expiring agreement, De Beers purchased 75% of Debswana’s output, leaving Botswana’s state-owned Okavango Diamond Company (ODC) with just 25% to sell independently. This meant De Beers controlled the flow, the pricing, and the strategic stockpiling of diamonds. As one analyst noted, the previous arrangement allowed De Beers to "park African diamonds firmly under the control of mismanaging multinationals".
At the heart of the tension is Debswana—a 50/50 joint venture between the government and De Beers. For 50 years, the deal was simple: De Beers handled global marketing and sales; Botswana collected roughly 80% of the revenue from domestic production. But last year, a new mining code and a standoff over a new sales agreement exposed deep fractures. The relationship between Botswana and De Beers, a
Botswana and De Beers signed a landmark 10-year sales agreement in February 2025, increasing the nation’s share of rough diamonds from 25% to 50% by 2035 and extending mining licenses to 2054. While designed to address economic imbalances, the deal operates amid significant market volatility and rising stockpiles, with some critics questioning if the terms sufficiently mitigate risks. Read the full details of the agreement on Reuters . Botswana's Diamond Stockpile Hits 12m Carats - IDEX Online
Rather than receiving a raw deal, the nation has fundamentally rewritten its relationship with De Beers.
Critics of the historic arrangement—and even high-ranking political figures in Botswana—argued that while the country supplied a massive portion of the world's rough diamonds, it captured too little of the downstream revenue.