The move is part of ODC’s strategy to capitalize on its increasing share of diamond production from Debswana, a joint venture between Botswana and De Beers.

ODC, established in 2012 to provide Botswana with an independent avenue for selling diamonds outside the De Beers network, currently receives 25% of Debswana’s output. However, following a new 10-year diamond sales agreement signed last year between Botswana and De Beers, ODC’s share of Debswana's production is set to increase from 30% initially to 50% by the end of the contract. This shift aims to allow Botswana to capture more revenue from its diamond resources.

To support these larger purchase volumes, ODC has appointed Standard Chartered Bank to structure and coordinate the new $300 million syndicated revolving working capital facility. This new facility is intended to replace a $140 million working capital facility that matured in 2023. At present, ODC can only finance purchases up to $70 million using its own cash reserves.

Minister Serame highlighted the importance of securing a $175 million government guarantee to back the new credit facility. This guarantee will not only support ODC’s expanded entitlement to 30% of Debswana's rough diamond supply but also help the company negotiate more favourable financing rates in the local market.

The diamond industry has been facing a downturn, with Debswana's sales plummeting by 49% in the first half of the year. In response to weakened global demand, ODC temporarily suspended rough diamond sales in October last year as part of an industry-wide effort to reduce excess inventory in the cutting and polishing sector.

Despite the current challenges, Serame expressed optimism about the industry’s prospects, expecting a recovery in global demand by the fourth quarter of 2024. The availability of the new credit facility would position ODC to take full advantage of this anticipated market rebound.