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Diamond market is struggling, so Botswana will boost its mining exploration

Bogolo Kenewendo, the Mines Minister, said that Botswana intends to increase mining exploration in order to diversify its economy beyond diamonds.

Long regarded as an African success, the country in Southern Africa has been hard hit by the prolonged decline of the global diamond industry, driven by the economic uncertainty and growing popularity for lab-grown stones. About one third of Botswana’s revenue is generated by diamonds.

Debswana Diamond Company is Botswana’s joint venture with De Beers, which accounts for 90% of country’s diamond sales. The company has no plans to boost production amid a sluggish economy.

Debswana CEO Andrew Motsomi stated that it was not a good idea to burn cash and store up (diamonds).

According to data from the finance ministry, Botswana's stockpile was 12 million carats by the end of December. This is nearly twice the government-allowed inventory of 6.5 millions carats.

U.S.

Kenewendo stated that while diamonds would?remain as the backbone of mining, the government is pushing forward with its plans to expand the mineral base including critical minerals.

She said that a newly formed state-owned exploration firm would be focused on increasing exploration levels.

We were more interested in diamonds and less interested in other valuable minerals. Kenewendo said on the sidelines of a mining conference for Africans in Cape Town that "we're now going to change this". If you have only explored 30% your country, this shows that we are very focused on diamonds.

Investors are a bit hesitant to invest in exploration. She added that you can lose a great deal of money if you explore and don't find anything. We want to make sure that we are armed with the correct data and that we know where everything is so we can decide if we would like to invest in that area.

Botswana has emerged as a copper-mining hotspot and is one of the top diamond producers in the world.

The U.S., and China are competing for copper and cobalt, two critical minerals used in advanced manufacturing.

Kenewendo stated that the U.S. expressed an interest in exploring and mining with Botswana, but talks were still at a very early stage.

She said, "We'll see what happens." "We are just investing in general in the mineral sector." (Reporting by Olivia Kumwenda-Mtambo. Mark Potter (Editing)

(source: Reuters)