Phillimon Molaodi
30 July 2004
THE Managing Director of the DeBeers Group, Gary Ralfe has refuted claims that Lev Leviev, the owner of Lev Leviev Group is likely to set up a diamond cutting and polishing factory in Botswana.
On Tuesday during the first anniversary celebrations of Diarough ownership of Teemane Manufacturing Company in Serowe, the Minister for Minerals, Energy and Water Resources, Boometswe Mokgothu confirmed that his ministry is in discussions with various companies who are interested in setting up diamond manufacturing operations in Botswana.
"We are continuously engaged in discussions with various people who have interest, means, experience, technology and know-how, with a view to setting up more diamond manufacturing operations in Botswana," he said.
Mokgothu was last week quoted as saying: "The Israeli tycoon is coming with what Botswana has been looking for."
The minister is understood to have said that the government does guarantee approval of Leviev's proposal.
However, the De Beers Group MD denied that the minister's speech on consultations was in reference to Leviev.
"As far as I know, there will be four cutting and polishing factories here by the end of the year. That is; Diarough in Serowe, Schachter and Namdar in Molepolole, Euro star and Star Group in Gaborone," he explained.
In a separate interview, the Communications Manager of DeBeers, Tom Tweedy also dismissed Leviev's claims.
"It is easy to make promises," he said.
"By just using common sense, where do you think he will get the '10's of thousands' job vacancies? Even with us here at Debswana, we do not have that capacity, but we are the second largest employer after government. All our four mines employ about 6500 people," an official of Debswana stated.
Global Head of Diamond and Jewellery division for ABN AMRO Bank, Peter Gross declined to be pulled into the cutting and polishing debate issue.
"I don't want to discuss whether the countries that mine diamonds should also cut them, but I believe each country has the right to maximize its resources and create employment. It is actually an issue of balance," he explained.
Lev Leviev, is seen as a threat to the DeBeers quasi-monopoly following his latest move in Namibia, where he has built the largest cutting and polishing diamond factory in Africa, with a capacity to employ 550 people.
He is also reported to have full support of the country's president, Sam Nujoma. Leviev's presence in the neighbourhood of DeBeers business nerve centre has unsettled the company.
Botswana is by far the largest producer of diamonds by value and carats. Last year the country produced a record of 30.4 million carats translating into 69% of DeBeers' total output.
DeBeers has been criticised for doing little to develop the indigenous people of the countries where it has mining interests, while the Leviev package holds appeal for the local communities. In Botswana, for instance, he reportedly promised to relieve "10's of thousands" of unemployed people. He has already approached the government, sources said.
DeBeers owns 50% of shares in Debswana with the remaining shares owned by the government.
Leviev is an Israeli tycoon who is threatening to muzzle DeBeers' quasi-monopoly system after the company allegedly angered him last year in South Africa. The Economist magazine reported that "Leviev long worked as one of those DeBeers sight holders, buying unseen parcels of stones at non-negotiable prices. Even as recently as last year, he was among DeBeers's clients in South Africa. Being forced to take or leave the stones granted by the diamond cartel infuriated him and he was eager to strike back."
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