De Beers’ announcement of a landmark Black Economic Empowerment deal does not mean the challenges it faces in its home country are over.
For most of the year, De Beers has been at odds with the government over a proposed Diamond Act that would place a 15 percent export duty on diamonds not manufactured internally. De Beers has warned that this would mean the end of the so-called “London mix,” which gives sightholders a wider range of diamonds than they receive from other producers. Subsequent versions of this legislation have eliminated this provision—and De Beers says it is “happy” with the changes, although it still has problems with the larger bill.
De Beers will almost certainly make some changes. Among the options that are being considered: mixing all the diamonds in neighboring Botswana. That would keep the “London mix” alive—just not in London.