Botswana Mining Review Comprehensive Coverage of the Progress and Achievements in the Mining Sector
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Botswana has enacted a sweeping new measure requiring foreign mining companies to cede a significant portion of ownership in new concessions to local investors, the country’s mines ministry announced Friday. The rule, which took effect on October 1, mandates that a 24% stake in any new mining project be sold to domestic investors, a provision that kicks in should the government opt not to acquire the equity itself.
The move marks a substantial shift in the resource-rich Southern African nation’s approach to its mineral wealth. Previously, the Mines and Minerals Act granted the government the right to purchase a 15% share in any licensed concession, with the possibility of a larger stake specifically in diamond projects. Botswana is the world’s leading diamond producer by value and is also rapidly developing its copper mining sector.
The Ministry of Minerals and Energy, in a formal statement, confirmed that the 24% local ownership requirement has entered into force.
Increasing Local Control and Value
The new law extends beyond mere equity transfer. Its stated aims are multifaceted: to ensure greater local ownership of the country’s vast mineral resources, to actively $\mathbf{promote local value-adding activities}$ within the mining supply chain, and to guarantee that mining companies establish environmental rehabilitation funds for site cleanup.
The government’s push for increased domestic participation has long been debated. During parliamentary discussions of the amendment to the Mines and Minerals Act, the former mines minister suggested that local investors could secure the necessary capital to purchase these stakes with assistance from the domestic pension fund, effectively leveraging national savings to secure a share of the country’s resource revenue.
Analysts view the rule as a concerted effort by Gaborone to deepen the economic integration of its crucial mining sector, ensuring that a greater share of the wealth generated by diamond and copper extraction remains within the country and contributes to local economic empowerment.
