This initiative is part of proposed amendments to the Mines and Minerals Act, which will be debated by lawmakers on Wednesday. Given the dominance of the ruling Botswana Democratic Party in parliament, government-proposed bills typically pass with minimal alterations.
Under the current legislation, the government can acquire up to 15% equity in any new mining entity. The proposed amendment encourages, but does not mandate, new mining ventures to invite citizens to purchase shares if the government does not exercise its 15% option. The draft legislation states, “Where government does not exercise its option of acquiring 15% working interest upon the granting of a mining licence, the holder shall use his best endeavour to dispose the 24% to citizens or citizen-owned companies.”
Botswana, known as the world’s largest producer of rough diamonds by value, seldom changes its mining laws and is often rated as Africa’s top destination for minerals investment. This is attributed to the nation’s consistent policies in an industry that constitutes a third of its budget revenue and the majority of its foreign-currency earnings.
Globally, resource nationalism is gaining traction as developing countries seek a larger share of the profits from their natural resources and address historical disparities in wealth distribution from mining activities. In recent years, there has been growing pressure from Botswana's citizens for direct equity access to the mining sector.
The proposed amendments date back to 2016, when the government suggested increasing its equity entitlement and inviting citizens to invest if the state opted out. Additional proposed changes include mandating mining companies to process minerals domestically "as far as is economically feasible" and to the "satisfaction of the minister." License holders will also be required to prioritize local citizens and their businesses in procurement.
Although the government seldom exercises its 15% equity option, it holds significant stakes in key companies such as diamond producer De Beers, Morupule Coal Mine, and salt and soda ash producer Botswana Ash Ltd.
