Connect with us

Hi, what are you looking for?


De Beers inactivity Spells local Gloom

De Beers Spells Local Gloom
INACTIVITY MEANS DOOM: Lack of productivity means government could lose big

Govt set to lose over P16 billion in diamond revenue

In response to the impact of Covid-19, De Beers has drastically reduced its production guidance for the year.

Initially, De Beers had set a target of mining between 32-34 million carats for 2020. The figure has since been scaled down to between 25-27 million carats due to the outbreak of the novel Coronavirus, which has led to a temporary shut down of virtually all industries.

Having suffered a disastrous 2019, the industry appeared to be gaining momentum in the early stages of 2020.

However, these roots of recovery have now ground to a complete halt.

From the two sights held this year, rough diamond sales totaled 8.9 million carats, a notable increase from the 7.5 million carats garnered at the same stage last year.

The lower demand of 2019 was largely due to the higher availability of polished stocks.

Advertisement. Scroll to continue reading.

In an update to stakeholders, Anglo American – De Beers’ parent company – says sales volumes increased year-on-year despite adverse demand impacts on Q1 of 2020 from Covid-19. Customers were also given the option to defer some allocations in the second sales cycle, offset by a shift in demand towards lower value goods.

De Beers did not hold its third sight – scheduled for April – as movement of people has been restricted both locally and abroad. Instead, the company has provided its customers with flexibility to defer all their allocations from Sight 3 to later in the year.

Meanwhile, the latest developments regarding the diamond industry are expected to hit government coffers hard.

For decades, Diamonds have been Botswana’s biggest revenue earner, accounting for a large portion of the country’s exports in terms of value.

With no diamonds currently being sold due to the pandemic, Botswana stands to lose a massive amount of money.

When addressing the media recently, Minister of Finance and Economic Development, Dr. Thapelo Matsheka predicted the country could lose well over P16 billion in revenue from diamonds.

The Minister revealed government originally expected to receive around P20 billion from diamond sales for the 2020/2021 financial year. The revised figure now stands at P6.7 billion.

Advertisement. Scroll to continue reading.

Additionally, government will lose more on taxes and levies from the mining industry. According to Matsheka, government now forecast making P12 billion instead of the envisaged P14 billion.

Government are set to miss out on a further billion in Value Added Tax (VAT), which is expected to fall from P8.6 billion to P7.6 billion.

The poor performance is anticipated to cause serious harm to the economy, which earlier in the year was projected to register growth of 4.2 percent.

Instead, it is now forecast to shrink by a mammoth 13.1 percent owing to the drop in diamond sales and other sectors of the economy, including transport and communications as well as hotel and restaurants.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like


A Maun taxi man was on Wednesday morning saved the agony of going to prison for stealing car tyres and battery from his friend’s...


Marriage preparations took a dark twist in Molepolole last weekend as a groom to be got locked up for threatening to kill his own...


Botswana Sector of Educator’s Union (BOSETU) Treasurer; Samuel Aboneng, is recuperating at Lenmed Health Bokamoso Private Hospital following a freak car accident that occurred...


Negotiations for the signing of a contract between the Gambling Authority and Growminds Africa (PTY) LTD to kick off the National Lottery may take...


Botswana Federation of Public, Private and Parastatal Unions (BOFEPUSU) President, Johannes Tshukudu, says no foreign investors will come to invest in the country, as...


Lusaka Dynamos Secretary, Shalala Sepiso, today confirmed that the club has signed two Botswana women footballers. The duo, Sindy Tsumake and Warona Molete, have...


A case in which a Thamaga man and his son are accused of raping a 10-year-old girl is at a stand still after state...


Working more than 55 hours a week can actually cause death, World Health Organisation (WHO) has revealed. In a press statement released today, 17th...


Copyright © TheVoiceBW. (Since1993) made with ❤️ in Botswana.