Debswana is a mining company that deals with the production of diamond in Botswana. Debswana has a unique partnership between the DeBeers Company and the Government of Botswana. Currently, Debswana is the leading diamond producer in the world and has its operations staged in four major mines of Damtshaa Mine, Janine Mine, Letlhakane Mine and the Orapa Mine. The company is the largest private sector employee with over 8000 employees. The company has heavily invested in the future of the communities by participating in the community development projects in the areas of their operations. The purpose of this paper is to describe the history of Debswana, keeping a focus on the relationship between DeBeers and the government of Botswana. How the Debswana profits are used within Botswana and lastly, who has benefited and who has suffered because of Debswana.
History of Debswana and the existing relationship between DeBeers and the government of Botswana
Debswana was founded on 23 June 1969. A group of DeBeer geologists found traces of diamonds along River Motloutse and in1967 April the Orapa mines were discovered. On June 23rd, 1968 the DeBeers Botswana Mining Company was informed. In 1969, the DeBeers geologists started moving south of Botswana for diamond prospecting and in this same year, the agreement to establish Debswana was signed (Barnett 21). The endorsement of the agreement to establish Debswana, which was a partnership between the government of Botswana and the DeBeers was done in the presence of H.F Oppenheimer the former coordinator of DeBeers, Sir Seretse Khama the former President of Botswana and the former Minister Haskins. Two years later the Orapa Mines were the first to be commissioned by Debswana, and this was immediately followed by the commissioning of the Lethlhakane Mines in 1975. After the commissioning of the two mines, the Company and the Government of Botswana came in the agreement in May 1978 to establish the Jwaneng Mines.
The Jwaneg Mines came into full operation, and production in July 1982 and the mine was opened in August the same year by the then President Sir Ketumile Masire. In 1992, the DeBeers Mining Company was officially named Debswana Diamond Company, and this saw the Government of Botswana and DeBeers Miners hold 50% shares. In August 1996, the Botswana government, DeBeers miners, and the Debswana Diamond Company came into agreement that leads to doubling the production at the Orapa Mines. This made the mine increase the production to 12 million carats annually from 6 million carats, and the overall production of Debswana was raised to 26 million carats per year. In 2000, the company also initiated the Aquarium project at the Jwaneng Mines that saw the introduction of high-tech x ray scanners replacing the hard hand sorting of diamonds that was being done manually.
In the same year 2000 when the Jwaneng Mines Aquarium was automated, the Morupule Coal mines became functional and fully operationally. The Damtshaa Mine started operating in 2002, and four years later the Botswana government and the DeBeers government agreed upon a historic agreement. The agreement signing which was held at Gaborone International Convention in the presence of the Botswana President HE Festus Mogae and Charles Tibone the country’s minister of minerals, energy and water resources was meant to embark on a watershed initiative that can transform the economic profile of Botswana (Goodson 31).
The agreement included the renewal of the mining license of Jwaneng mines to 2029 and the extension of the mining license in the other mines of Orapa, Letlhakane, and Damtshaa. The agreement signed in 2006 also included the extension of the Debswana agreement to 5 years to the Diamond Trading company for five years. The government of Botswana and DeBeers agreed over the years put in place Diamond Trading Company of Botswana. The company was mandated with the sorting, valuing, selling and marketing diamonds in the country.
In December 2010, the Jwaneng mine's cut eight projects were launched by Khama Serete the president. The following December the government of Botswana signed a 10-year sales agreement with DeBeers backdating it to January. DeBeers agreed to move Diamond Trading Company of Botswana from London to Gaborone by the end of 2013 and to allow the government to get access to sell 10% of Debswana's production independently (Mudau 31). In 2012, the Botswana's first state diamond trading company was formed, starting its operations with 10% of Debswana's total annual production and make progress to 15% over a five-year period. In 2014, Debswana celebrated its 45 years of existences and been the world is leading producer of diamond.
How Debswana’s profits are used within Botswana
The company throughout the 45 years, it has been in existence, it has greatly contributed to the development of Botswana. The profits generated by the company have essentially been used in building infrastructure and provision of essential services such as schools and hospitals in the country (Mudau 37). The profits realized by Debswana have been used on selected projects in the country such as health care. The company has constructed two hospitals in the Orapa and Jwaneng, which service the communities in times of emergencies. The company also came up with a program in 2009 that was aimed at addressing the dental, medical care among the primary schools. The program partnered with Caterpillar, its major supplier visits schools in the mining communities and the capital city to offer the service to school going kids.
The profits of the Debswana Company are also pumped into socioeconomic development projects in Botswana. Over the past years, the company has continued to provide electricity and construct roads throughout the country. The country has also put in place an electrification plan for communities around the mines to improve the lives of the people. The company has continued to pump the profits it makes in the social amenities projects such as construction and rehabilitation of sports facilities. Other than the provision of social amenities, the company has continued to support the Botswana Olympic team as the main financier.
Who has benefited and who has suffered because of Debswana
The existence of Debswana has been beneficial to some people in the country of Botswana. The company has largely shown its commitment to social responsibilities starting with the local community where the mines are located and is now expanding to the national level. The first beneficiaries of Debswana are her employees who are HIV infected who receive antiretroviral treatment.
The company through the hospitals in the Orapa and Jwaneng ensures its employees; their spouses and children under the age of 21 years receive 100% subsidy cover for the HIV/AIDS drugs (Barnett 34). The company has continued to put in place initiatives that are committed to fighting against HIV/AIDS to minimize its impact on its employees, their families and the Botswana community as a whole. The two hospitals in the Orapa and Jwaneng mines also serve the communities in cases of emergency. School going kids in the mining communities and the capital city of Botswana have also benefited as the result of the company. They can access free medical care through the initiatives the company launched in 2009 of mobile dental clinics in primary schools.
The local communities around the mine are the ones who have suffered because of the company because they have to be displaced. Nevertheless, they have not been completely ignored after displacement because the company has come in to ensure they are compensated. They have also benefited from the company’s electrification process (Idowu et al. 21). The company has also been beneficial to the vulnerable children in that it has constructed a children's home. The SOS Children Village was constructed to accommodate all the vulnerable children in the country. This has been beneficial to Botswana as it can handle the situation of late.
Conclusion
Debswana is the largest company in the country regarding employment and value, and it has an encouraging history. A history that is full of successes and continued empowerment of the Botswana people. It exercises a good social responsibility both morally and ethically in its areas of operations and the country as whole, and this justifies its coexistence with the communities. The company’s contributions to developments in the country, explains the special relationship with the government of Botswana and the resulting trust it holds is a result of the perceptions of shared values between the company and the communities.
Works Cited
Barnett, Tony. The Private Sector Responds to the Epidemic: Debswana - a Global Benchmark. Geneva: Joint United nations programme on HIV/AIDS (UNAIDS, 2002. Print.
Goodson, Stephen M. Inside the South African Reserve Bank. Place of publication not identified: Black House Publishing Lt, 2014. Print.
Idowu, Samuel O, Abubakar S. Kasum, and Asli Y. Mermod. People, Planet and Profit: Socio-economic Perspectives of Csr. , 2014. Internet resource.
Mudau, Fhedzisani S. The Application of the Balanced Scorecard in Debswana: A Case Study. , 2006. Print.
