Botswana's state-owned Okavango Diamond Company (ODC) wants a $300 million credit facility from local banks to buy more diamonds.
Finance Minister Peggy Serame was quoted by Reuters as saying that ODC appointed Standard Chartered Bank to structure and coordinate a new $300 million syndicated revolving working capital facility.
This follows the maturity of a $140-million working capital facility in 2023.
She told lawmakers while seeking approval for a $175-million government guarantee for the new credit facility that ODC currently affords purchases of up to $ 70 million using its cash reserves.
"The $175-million government guarantee will crucially support ODC's increased entitlement of 30% to Debswana's rough supply, as well as assist the company in negotiating favourable rates in the local market on a new working capital facility,” said Serame.
ODC currently gets 25% of Debswana's annual output.
A new 10-year diamond sales agreement signed last year between Botswana and De Beers will see ODC’s share of Debswana output initially increase to 30% and then gradually rise to 50% by the end of the deal.
Mathew Nyaungwa, Editor in Chief, Rough&Polished
