Diamond finishing to boost Botswana economy by $800 million

25 November 2011

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25 November 2011 | Adam Leach

Botswana hopes to have boosted its economy by $800 million (£516 million) by 2014 by persuading diamond buyers to let it cut and polish gems mined in the country.

The diamond beneficiation programme aims maximise the economic benefits of local extraction. It started some years ago and is estimated to have already contributed more than $400 million (£258 million) to the economy. The government now hopes to speed up the rate of benefit by encouraging more jewellery companies to sign up to the principle.

Speaking this week to representatives from the diamond industry at a conference organised by the Botswana government and the World Bank, Ponatshego Kedikilwe, minister of minerals, energy and water resources, said: “The diamond beneficiation impact will be felt in the long term when the initiative bears fruit.”

He went on to highlight the need for the government to work with and create a favourable environment for private companies in order to maximise the impact of the programme. “Botswana should create an environment conducive to investors,” he said.

De Beers signed up to the principle last year and in its 2010 Corporate Responsibility Report, out this month, leading jeweller Tiffany & Co explained its commitment to the principle of beneficiation. “Tiffany & Co recognises that diamond-producing countries want, and indeed deserve, to benefit from their diamond resources, we wholeheartedly support producer country beneficiation,” it said.

In support of the programme, the company established Laurelton Diamonds, a wholly owned subsidiary, to source, cut, polish and supply diamonds from Botswana, Namibia and other countries to the parent company. In 2010, Laurelton provided $67 million (£43 million) to the local communities in the areas where its diamonds were mined.

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