Gaborone, Botswana — MININGREVIEW.COM — 07 January 2010 – Debswana Diamond Company “’ the joint venture between De Beers and the government of Botswana “’ plans to cut at least 1 000 jobs, or about a fifth of its workforce, to help contain costs following a slump in demand for the gems since last year.
“Letters have been sent to mineworkers at Jwaneng, Orapa and Letlhakane mines to inform them that they may be laid off,” Debswana spokeswoman Esther Kanaimba told Bloomberg News in a phone interview from here.
Debswana “’ which accounts for about a fifth of world diamond output “’ shut its four mines last year as the global recession reduced spending on luxury goods including jewellery. Damtshaa mine still remains closed, while the other three re-opened in April.
“The company is reviewing its operations and we have informed workers that there is a likelihood that their jobs may be affected,” Kanaimba said. “Our strategy has been to contain costs, improve revenue for shareholders, maintain the effectiveness of the company and ensure sustainability.”
De Beers “’ which is 45% owned by Anglo American Plc “’ is seeking to raise US$1 billion (R7.5 billion) through a rights offer to cut debt. Managing director Gareth Penny revealed in November that sales were 47% of the level a year earlier.
The Botswana Gazette reports that about 1 278 employees may lose their jobs.
“Some jobs, such as cleaning and catering, may be outsourced, while other employees will be dismissed,” Kanaimba said. “The process may take the whole of this year to complete, with the first of the employees probably leaving by the middle of the year,” she added.
“Workers received letters complying with Section 25 of the country’s labour laws informing them of a possibility of job losses,” Botswana Mining Workers Union deputy secretary-general Sebataladi Ramoitoi said in a phone interview with Bloomberg News from Jwaneng.
“We are in negotiations with Debswana on how the project can be executed,” Ramoitoi said. “It is just the beginning of the process and we have not reached any agreement yet.”