News

Botswana deal in the open

Daniel Kali, MD De Beers Namibia throws light on the deal

diamond world news service

Daniel Kali, De Beers Namibia Managing Director said on March 4, 2006 that a combination of factors have made it necessary for DTC to establish a sales and marketing division in neighboring Botswana. The global diamond industry pipeline have it easy for the cutting and polishing diamonds in higher cost centers, like southern Africa, more viable. "That is to say that there exists an opportunity to cut and polish certain categories of diamonds in southern Africa, if skills and productivity levels can be achieved," said Kali.

Botswana government and DTC are discussing what is termed as the aggregation of diamonds, which currently takes place in London, to Botswana. According to Kali, the skills level for valuations and sorting have also improved in producing countries. Botswana is the worlds largest diamond producer by value. �The volumes just make it so much more practical to have this activity in Botswana," Kali added.

The exact figure of diamonds to be marketed in Botswana cannot be estimated because local sales levels would be determined by the economic viability of the cutting factories.
"Both the government of Botswana and De Beers are sensitive to the fact that increasing local sales will, if not sold to truly competitive companies, add additional costs to the cutting process," Kali explained. "This in turn will affect diamond price growth which is not in the interest of either shareholder in the partnership. Therefore, local sales levels will be determined by the effectiveness, sustainability and viability of the cutting factories."


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