Botswana flags synthetic gem threat
Moves ahead with US$6 billion investment
The natural diamond market has struggled over the past two years due to rising consumer demand for cheaper lab-grown gems.
Botswana’s president Mokgweetsi Masisi on Wednesday called synthetic gems a threat to the country's economic lifeblood, as the government readies to launch a US$6 billion project to extend the life of its flagship Jwaneng diamond mine.The natural diamond market has struggled over the past two years due to rising consumer demand for cheaper lab-grown diamonds, coupled with global macroeconomic volatility.
Masisi this week participated at the JCK Show in Las Vegas, considered the world’s largest jewellery trade event, to promote Botswana as a leading producer of ethically and responsibly sourced diamonds as the country looks to safeguard its market share for natural diamonds. According to industry watchdog Kimberley Process Certification Scheme data, Botswana produced 20% of the world's total rough diamonds in 2022, behind Russia. The southern African country is, however, the world's top diamond producer by value.
The gems contribute up to 40% of government revenue, 75% of its foreign exchange earnings and a third of national output.
“If lab-grown diamonds take our space, then you and I are finished," Masisi told reporters as he departed for the United States. He added he would wage "a peaceful assault against lab-grown diamonds, to give confidence to our partners and dampen any attraction to lab-growns.”
Billion-dollar project
Botswana and its partner De Beers, set to be spun off by parent company Anglo American, plan to launch the first phase of a US$6 billion project on 28 June to extend the Jwaneng mine’s lifespan from the current 2032 horizon to 2054.
The first phase, expected to cost US$1 billion, will establish a drilling platform to make comprehensive sampling of diamond-bearing rock easier. It will also develop essential infrastructure to support further stages of the project.
Jwaneng, in operation since 1982, produces an average 11 million carats per year, employing 2 100 permanent employees and 3 200 contractors.
At the show in Las Vegas, Masisi also planned to lobby the United States against plans by the Group of Seven (G7) countries to ensure all diamonds entering the bloc pass first through Antwerp in Belgium for certification. The United States, which consumes around 40% of the world's diamonds, is a leading member of the G7 bloc pushing for certification as part of sanctions imposed on diamonds from Russia following its invasion of Ukraine.