Botswana is seeking support from the United Arab Emirates and Oman to move forward with what could become one of the most significant deals in the global diamond industry: the acquisition of a strategic stake in De Beers, the 138-year-old diamond giant that has shaped the country’s economic fortunes for decades.
Botswana’s President, Duma Boko, confirmed that his government is in negotiations with the two Gulf nations while exploring options to participate in the sale of De Beers, which is currently being divested by mining giant Anglo American, according to a Bloomberg report.
Falling demand from China, the rapid rise of lab-grown diamonds, and uncertainty surrounding global trade have put pressure on natural diamond prices, reducing export revenues and slowing economic growth.
Diamonds remain the backbone of Botswana’s economy. The gemstones account for about 80% of the country’s export revenues and approximately a quarter of its Gross Domestic Product (GDP).
The government believes that increasing its stake in De Beers will allow it to exert greater influence over how the country’s diamonds are valued, traded, and sold on international markets.
An Industry in Transition
The opportunity comes at a time when Anglo American is overhauling its business strategy. The mining giant is selling off several assets, including its 85% stake in De Beers, after fending off a $49 billion takeover bid from rival BHP last year.
As part of this restructuring, the company is divesting assets deemed non-core and focusing on copper and iron ore, two raw materials expected to play a central role in the global energy transition.
For the country, the sale represents a rare opportunity to gain greater control over an industry that has shaped its development trajectory since independence.
Botswana already holds a 15% stake in De Beers through a long-standing partnership often cited as one of Africa’s most successful models for sharing natural resources. This relationship has helped transform the nation, which was among the world’s poorest countries in the 1960s, into an upper-middle-income economy. However, recent challenges have highlighted the risks of excessive dependence on a single commodity.
Earlier this year, S&P Global Ratings downgraded Botswana’s credit outlook due to declining diamond revenues and budgetary pressures. Government revenues from diamond sales have fallen sharply as international buyers have reduced purchases and inventories have risen in major trading hubs.
Seeking Strategic Partners
Botswana’s interest in Gulf investors reflects a broader trend of growing Middle Eastern involvement in Africa’s mining and natural resources sectors.
Both the United Arab Emirates and Oman have expanded their presence on the African continent in recent years through sovereign wealth funds, infrastructure investments, logistics projects, and mining ventures. Their substantial financial capacity makes them attractive partners for the country, which would struggle to finance an acquisition of this scale on its own.
Botswana’s head of state previously revealed that Gaborone had held talks with a sovereign wealth fund from Oman regarding potential financing for the acquisition of a controlling stake in De Beers. The government is also reported to have been in contact with neighboring Angola and Namibia with the aim of strengthening regional influence in the diamond industry.
Despite the sector’s recent difficulties, De Beers remains one of the world’s most recognizable diamond brands. The company operates some of the richest diamond mines on the planet, most of which are located in Botswana, and continues to play a central role in the global marketing and distribution of precious stones.
Source: Business Insider Africa
