In a statement delivered to the National Assembly on August, Minister of Finance Peggy O. Serame proposed extending a government guarantee of USD 175 million to the Okavango Diamond Company (ODC). This extension is requested to support ODC’s increasing entitlement to Debswana’s rough diamond supply and to facilitate a new working capital facility.
Under Section 22 (1) of the Public Finance Management Act, the guarantee will help ODC secure favorable credit terms amid challenging market conditions. ODC, wholly owned by the Botswana government, plays a key role in marketing Botswana’s rough diamonds and has seen its allocation increase from 12% to 25% of Debswana’s production.
The proposed guarantee, which follows the expiration of a previous USD 100 million guarantee, will support ODC’s new USD 300 million syndicated revolving credit facility. This extension is crucial for ODC’s operations and aims to mitigate potential negative impacts on investor confidence and market stability.
The Finance Minister highlighted that without the guarantee, ODC’s ability to purchase diamonds and negotiate terms would be significantly hindered, potentially affecting both operational efficiency and industry recovery projections.
The proposal, if approved, will ensure that public debt remains within statutory limits while supporting ODC’s strategic goals and market positioning.
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