There may be corruption in the management of diamonds in this country due to a cloud of secrecy, Member of Parliament (MP) for Selibe Phikwe West, Dithapelo Keorapetse has intimated.
Addressing the Botswana Mine Workers’ Union (BMWU) 22nd elective delegates congress in Francistown, Keorapetse observed that mining agreements are not available to the Auditor General as they are considered to be confidential, especially for Debswana or companies in partnership with the Botswana government.
“Who then guards the guardians? Who scrutinises these agreements? What is the role of parliament in this?
“This secrecy also presents a huge challenge on the ability to audit the payments of dividends as these are contained in these top secret contracts.
“It is also against internationally acclaimed principles espoused by Extractive Industries Transparency Initiative to publicly disclose mining contracts, agreements and licenses,” the vocal MP added.
Keorapetse told the BMWU gathering that according to media reports, a consultant engaged by Botswana Unified Revenue Services (BURS) has said that De Beers could be owing in excess of P7 billion in taxes emanating from profits shifting to subsidiaries in the United Kingdom (UK) through inflated service charges.
“More damning is the allegation that the Office of the President (OP) has ordered BURS to sign off the Advance Pricing Agreement with De Beers and the British HM Revenue and Customs and write off the P7 billion Tax bill in favour of the mining giant.
“We will be pursuing this matter through MPs in the House of Commons to ask questions and we will ask questions in our own parliament.
“The UDC is in possession of some parts of the report and we will be demanding it in full. Still on mining, P1.8 billion used in BCL liquidation has not been audited to verify prudence,” Keorapetse said.
He called upon government to claim a bigger stake from the country’s partnership with the DeBeers than the 15 percent it is currently getting.
Keorapetse is also the Leader of the Opposition (LOO). He would like the Umbrella for Democratic Change (UDC) government to demand a bigger share of diamonds from DeBeers.
“Why can’t we push to acquire more than 50 percent of the diamond share from DeBeers? When you look at the journey of diamonds in Botswana, the country has cared and focused for a long time on the upstream which entails diamond exploration and rough diamond production, as well as mining.
“It is only recently that the country has showed a bit of interest in the midstream aspect which is mainly about polishing,” Keorapetse complained.
According to him, the country is still not doing well in jewellery manufacturing, which is more valuable, in terms of the global market share and contribution to the Grand Domestic Product (GDP).
The MP noted that it is not enough that the country is doing only midstream, rough diamond sales and distribution.
“On the downstream, that is diamond jewellery retail and global consumer demand one would assume that we would be the place to come to for luxury diamond products, but no, that is not the case,” the LOO observed.
He called on government to take a cue from the Saudis who, according to him, demanded a bigger oil share from Standard Oil of the United States.
When the Saudis were given a raw deal, they threatened to nationalise their oil reserves unless they were given the 50 percent stake, to which the American oil companies not only agreed to and even relocate the company from California to Saudi Arabia, but the company name was changed from Arabian America Oil Company to Saudi Aramco.
Arguing that the American benefits had now exceeded their initial investment, the Saudis pushed for greater control and by 1976 they had acquired 98 percent of Saudi Aramco.
“The American oil companies remained with two percent and to this day the company shareholding remains that way,” lectured the MP.
A UDC government, he said, will pay senior citizens an old age pension of at least P1500 to 2000 because, as he put it, comparable economies in the region such as South Africa, Mauritius, Namibia and Seychelles appreciate their senior citizens better than us.
According to him, that would ease the burden of the poorly paid workers who find themselves having to sustain their own families, as well as sustain their aging parents and relatives.
Addressing the Botswana Mine Workers’ Union (BMWU) 22nd elective delegates congress in Francistown, Keorapetse observed that mining agreements are not available to the Auditor General as they are considered to be confidential, especially for Debswana or companies in partnership with the Botswana government.
“Who then guards the guardians? Who scrutinises these agreements? What is the role of parliament in this?
“This secrecy also presents a huge challenge on the ability to audit the payments of dividends as these are contained in these top secret contracts.
“It is also against internationally acclaimed principles espoused by Extractive Industries Transparency Initiative to publicly disclose mining contracts, agreements and licenses,” the vocal MP added.
Keorapetse told the BMWU gathering that according to media reports, a consultant engaged by Botswana Unified Revenue Services (BURS) has said that De Beers could be owing in excess of P7 billion in taxes emanating from profits shifting to subsidiaries in the United Kingdom (UK) through inflated service charges.
“More damning is the allegation that the Office of the President (OP) has ordered BURS to sign off the Advance Pricing Agreement with De Beers and the British HM Revenue and Customs and write off the P7 billion Tax bill in favour of the mining giant.
“We will be pursuing this matter through MPs in the House of Commons to ask questions and we will ask questions in our own parliament.
“The UDC is in possession of some parts of the report and we will be demanding it in full. Still on mining, P1.8 billion used in BCL liquidation has not been audited to verify prudence,” Keorapetse said.
He called upon government to claim a bigger stake from the country’s partnership with the DeBeers than the 15 percent it is currently getting.
Keorapetse is also the Leader of the Opposition (LOO). He would like the Umbrella for Democratic Change (UDC) government to demand a bigger share of diamonds from DeBeers.
“Why can’t we push to acquire more than 50 percent of the diamond share from DeBeers? When you look at the journey of diamonds in Botswana, the country has cared and focused for a long time on the upstream which entails diamond exploration and rough diamond production, as well as mining.
“It is only recently that the country has showed a bit of interest in the midstream aspect which is mainly about polishing,” Keorapetse complained.
According to him, the country is still not doing well in jewellery manufacturing, which is more valuable, in terms of the global market share and contribution to the Grand Domestic Product (GDP).
The MP noted that it is not enough that the country is doing only midstream, rough diamond sales and distribution.
“On the downstream, that is diamond jewellery retail and global consumer demand one would assume that we would be the place to come to for luxury diamond products, but no, that is not the case,” the LOO observed.
He called on government to take a cue from the Saudis who, according to him, demanded a bigger oil share from Standard Oil of the United States.
When the Saudis were given a raw deal, they threatened to nationalise their oil reserves unless they were given the 50 percent stake, to which the American oil companies not only agreed to and even relocate the company from California to Saudi Arabia, but the company name was changed from Arabian America Oil Company to Saudi Aramco.
Arguing that the American benefits had now exceeded their initial investment, the Saudis pushed for greater control and by 1976 they had acquired 98 percent of Saudi Aramco.
“The American oil companies remained with two percent and to this day the company shareholding remains that way,” lectured the MP.
A UDC government, he said, will pay senior citizens an old age pension of at least P1500 to 2000 because, as he put it, comparable economies in the region such as South Africa, Mauritius, Namibia and Seychelles appreciate their senior citizens better than us.
According to him, that would ease the burden of the poorly paid workers who find themselves having to sustain their own families, as well as sustain their aging parents and relatives.
