De Beers Yields to Namibia’s Demands

De Beers LogoGaborone; Diamond giant, De Beers, which is 85 percent controlled by Anglo American, has reportedly “agreed in principle” with the Namibian government to introduce changes in a proposed new diamond sales and marketing contract.

The Namibian newspaper reports that Windhoek had demanded that 25-30 percent of the diamonds produced by Namdeb, a joint venture between the Namibian government and DeBeers, stay in the country for local cutting and polishing.

Namibia was also said to have demanded that the entire range of special stones (qualities, classes, sizes) be made available for sale and manufacturing in Namibia without limits. The daily claimed that a team had been put in place to finalize the agreement.

“A window in the market to enable the government to buy a meaningful portion of Namdeb Holding’s rough diamonds and sell them through alternative channels (is needed),” information minister Tjekero Tweya was quoted as saying in a statement.

The Namibian government was willing to find its own market outside of the De Beers’ system and had already consulted other countries in the diamond industry such as India. “We are a little wiser now, than we were years ago. We know there is a market out there,” said Tweya.

Namibia’s demands had been generally buoyed by a sales and marketing agreement that De Beers and Botswana reached in 2011, which the southern African country receiving 10 percent of Debswana’s production.

This had been gradually increasing annually since then and it would be capped at 15 percent in 2016. As a result, Botswana established the Okavango Diamond Trading Company to market and sell the diamonds gained through the agreement.