De Beers acquisition deal is illegal - BCP

The Botswana Congress Party (BCP) has slammed President Advocate Duma Boko’s recent announcement regarding the acquisition of a stake in De Beers, calling it unlawful and beyond his executive authority.Adv. Boko announced to the world that by the end of October 2025, Botswana would have concluded a deal with Anglo American plc that would raise the country’s stake in De Beers to more than 50 per cent, giving Botswana effective control of the mining conglomerate.The BCP argues that as of now, the President has not sought Parliament’s approval of this transaction, nor has the approval been given.“The question then is: from whence did he get the authority to commit Botswana to the acquisition of a controlling stake in De Beers? This is yet another example of the President showing contempt for Botswana’s laws, its institutions and processes, and the people, and treating the country like his personal property”.BCP Information and Publicity Secretary Professor Mpho Pheko said the Minister of Finance must explain to Batswana whether indeed the Government has negotiated the purchase of at least an additional 36 per cent of De Beers shares and how he plans to pay for them.She said that the BCP opposes this transaction, arguing that the President has not made a business case for it.“It is too risky and too costly. It has been subjected to no appraisal or due diligence. It is illegal. It could bankrupt the country or reduce Botswana to the ignoble role of a front for third parties, including unscrupulous profiteers,” Prof Pheko said.The BCP contends that the state of the economy and the country’s fiscal position do not support the proposed transaction. According to the party, it will have no immediate impact on economic growth, government revenue, or employment.Prof Pheko indicated that the government projects an economic decline/contraction of 0.4 per cent in 2025. This, she said, means the economy will endure a second successive year of recession.“The IMF projects an even sharper decline, one per cent. The fiscal outlook is not good either. The Ministry of Finance projects large budget deficits up to 2028, with budget deficits of P24.7 billion and P22.1 billion in 2024/25 and 2025/26 (projected), respectively. Public debt has risen above 30 per cent of GDP. It is common knowledge that the Government is struggling to honour its obligations, including salaries and payments to suppliers. Under the circumstances, the commitment of billions to the acquisition of De Beers would amount to an extreme act of fiscal recklessness. It will push Botswana to the fiscal cliff,” she said.The BCP spokesperson pointed out that the acquisition of an additional 36 per cent of De Beers shares will come at a huge opportunity cost to Batswana.Public health and public education are both in crisis, she said, adding that to acquire the quantum of De Beers shares required for a controlling stake, Botswana will have to sacrifice the health and lives of citizens and the education of their children.She stated that it will be comical, if not foolhardy, for a government that cannot buy medicines for its people and learning and teaching materials for its children to commit billions of Pula to a speculative high-risk investment.She contended that the BCP will not trade the health and lives of Batswana, and the education of their children, for additional De Beers shares.“Botswana does not have diamond industry-specific knowledge assets necessary to make its control of De Beers count at any level of the value chain. As one industry commentator opined, it is one thing to assume control of your minerals, it’s completely another to turn a profit out of running a global corporation that De Beers is,” she said, adding that at best, Botswana will assume more ownership risk of De Beers without operational control.More probably, government ownership will erode the company’s operational efficiency, attractiveness to investors, and profitability.

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De Beers acquisition deal is illegal - BCP