Botswana implements rule mandating 24% local ownership of mines

The government of Botswana has implemented a new regulation which requires mining companies to sell a 24% stake in new concessions to local investors if the government chooses not to buy the stake.

The country's Ministry of Minerals and Energy said on Friday that the rule took effect on 1 October.

Before, the Mines and Minerals Act allowed the government a 15% shareholding in mining concessions, with a higher stake option in diamond projects.

Botswana is one of the world's top diamond producers.

Rutendo Hwindingwi, founding director of Tribe Africa Advisory, notes it is projected that the country's economy will contract for a second year in a row.

With earnings from diamond sales hurt by weak demand and synthetic stones, Botswana has struggled to finance its budget, as Africanews reports.

In 2023, GDP dropped by 0.3% Hwindingwi says, and in 2024/2025 it's expected to fall by another 0.4%.

This is among the challenges faced by the new government, which was formed in November 2024 following a general election.

"The new leadership's come on in a proper and democratic process which was necessary...  and I guess what you do in tough time is what defines leadership, so let's see if these economic reforms make the right impact for the country and its people."

To listen to Rutendo Hwindingwi in conversation with Stephen Grootes on 702's The Money Show, click on the audio link below (skip to 1:21 for Botswana discussion):