Botswana Dismisses IMF Warning on Buying De Beers

(IDEX Online) - Botswana's president has dismissed IMF concerns over his country's bid to buy De Beers, and vowed to press ahead.

A defiant Duma Boko drew cheers from a crowded public assembly on 15 December when he said it was for the people of Botswana to decide, not the IMF.

"Don't tell me about the IMF, tell me about Batswana (people of Botswana) who are suffering," he said.

"It's our people who are running this country, and we said we want De Beers, and we are going to take it."

He was speaking after the IMF issued a stark warning that increasing Botswana's stake above the current 15 per cent would deepen its exposure to a sector that is facing significant uncertainty, and could well increase public debt.

Boko has repeatedly said that acquiring a controlling interest in De Beers is a matter of economic sovereignty and a strategic goal, consistent with wider policy goals.

Anglo American, which owns 85 per cent of De Beers, is divesting the loss-making diamond miner as it focuses on copper and other more profitable assets. It has valued the company at $4.9bn, though many in the industry believe the real value is far lower.

The IMF has no power to block Botswana from increasing its stake in De Beers, but its warning carries significant weight with investors, lenders and rating agencies, particularly as the government explores financing options for a multibillion-dollar acquisition.

Pic shows President Duma Boko.