(Bloomberg) -- Botswana’s new president, Duma Boko, picked Bogolo Kenewendo to be mines minister as his administration moves to cement a deal with De Beers that aims to ensure the nation will derive greater benefit from its diamond riches.
The appointment of Kenewendo, an economist who served as trade and industry minister from April 2018 to November 2019, was announced in the capital, Gaborone on Thursday. Boko assigned six cabinet posts earlier this week, including that of finance minister to Ndaba Gaolathe, who is also the deputy president.
Botswana is the world’s largest producer of rough diamonds by value and the gems account for the bulk of state revenue. Global diamond sales have been impacted by oversupply, poor demand from the crucial Chinese market and pressure from lab-grown gems.
Almost all of Botswana’s gems are mined by Debswana, which is jointly owned by the government and De Beers, a unit of Anglo American Plc. Under a 10-year accord announced by Botswana’s previous administration in July last year, the state-owned diamond trader will get 30% of Debswana’s output, while the government will secure 10 billion pula ($729 million) in development funding.
Boko, who succeeded Mokgweetsi Masisi as president after his coalition won Oct. 30 elections, has previously criticized the way the deal was negotiated and warned that it had adversely affected the country’s relationship with De Beers, which was now considering walking away from it.
Earlier Thursday, the president held a private meeting with Anglo American Chief Executive Officer Duncan Wanblad and his De Beers counterpart, Al Cook, in Gaborone.
“We see the negotiations concluding in days and weeks, not months and years,” Cook said after the talks. “We are getting to the point of the technicalities in the agreements, dotting the Is and crossing Ts. I believe it’s very important that the diamond markets around the world see the nation of Botswana and the company of De Beers standing shoulder to shoulder in order to promote natural diamonds. That will build confidence” in the industry at a time when it is confronting its most challenging period since the 1980s, he said.
Boko said Botswana remains committed to its relationship with De Beers.
“This is the first real contact with the new administration and we believe that there are issues that we need to discuss,” he told reporters prior to the meeting. “We have a long-standing partnership, which has benefited this country and carried us for those many years, and we are confident that it will endure to the future. Where there are any niggling issues, as I understand that there have been and still are, we will work together as partners to resolve them.”
Wanblad also expressed confidence that an agreement could be reached.
“As partners, we sometimes have divergent views, but we must have convergent interests,” he said. “We stand committed to faithfully working with government” and resolving “these potentially outstanding niggling issues,” he said.
--With assistance from Paul Richardson.
(Updates with comment from De Beers CEO in seventh paragraph.)
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