Botswana has enforced a new rule requiring mining companies to sell a 24% stake in new concessions to local investors if the government chooses not to buy the stake, its mines ministry said on Friday.
The rule was proposed last year as part of draft legislation, but the government had not said when it would take effect.
The Mines and Minerals Act previously gave Botswana‘s government the right to buy a 15% shareholding in any mining concession upon being licensed, with an option for a higher stake in diamond projects.
The Southern African country is the world’s top diamond producer by value and an emerging copper mining hotspot.
The Ministry of Minerals and Energy said in a statement that the rule requiring 24% local ownership in mining projects had entered into force on October 1.
As well as increasing local ownership of the country’s mineral wealth, the law aims to promote local value-adding activities and ensure mining companies establish environmental rehabilitation funds.
When the amendment to the Mines and Minerals Act was being debated in parliament, the former mines minister said local investors could buy stakes in concessions with the help of domestic pension funds.