Botswana is reaching a critical turning point for its economy, which has long been fundamentally dependent on the diamond market, a market now facing an unprecedented crisis. What was once a major strength is increasingly becoming a structural vulnerability. The country is therefore exploring the different ways it may eventually reduce this dependence.
A weakened economic pillar
In an in-depth article, Lagos-based news outlet News Central TV examines Botswana’s current situation. The figures are striking. Diamonds account for roughly one-quarter of the country’s GDP and up to 80% of export revenues. In 2025, production declined by approximately 40%, and forecasts remain even more pessimistic. Diamond revenues have been cut in half, widening the country’s budget deficit. This contraction comes against a backdrop of elevated inventories, estimated at 12 million carats at the beginning of 2026, nearly double the level considered reasonable by the government.
This shock directly weakens Botswana’s fiscal model and, consequently, its social model, at a time when no sufficiently advanced alternative growth driver has yet emerged. One economist noted that “Botswana’s fiscal model is undergoing a real stress test precisely as its main export engine is running out of momentum.”
Faced with this pressure, Gaborone chose to negotiate with its long-standing partner De Beers, signing an agreement that increases the share of Debswana* production the State may sell through the Okavango Diamond Company (ODC). This share has been raised to 30% and, according to the agreement, is ultimately expected to reach 50%. In exchange, mining licenses have been extended by 25 years. Botswana has therefore strengthened its control over the marketing of its diamonds, while De Beers, for its part, has secured new guarantees.
What growth driver for the future?
At the same time, the country is attempting to build a second pillar of growth, with diversification appearing to be the only viable path forward in the absence of any long-term visibility on the diamond market. “Africa must learn from Saudi Arabia and not rely solely on mineral resources,” explained one expert interviewed by News Central TV.
The Botswana Economic Transformation Programme aims to develop the services sector, attract new investors, expand the country’s financial industry and support a network of SMEs and digital industries in order to stabilize national revenues. To support this objective, the country established the Botswana Sovereign Wealth Fund Limited in 2025, tasked with overseeing new investments both domestically and internationally. Energy, tourism and technology are among the priority sectors under consideration, with the objective of integrating Botswana more deeply into a broader regional framework. In parallel, a private fund, the Botswana Tech Fund, is expected to focus its investments on technology and venture capital.
Despite the severity of the shock the country must absorb (S&P downgraded its sovereign rating to BBB- in 2025), the IMF appears relatively optimistic regarding Botswana’s ability to transform its economy, forecasting growth of 4.7% this year.
*Mining company based in Botswana and equally owned by the government and De Beers Group
The full article can be found HERE.
Source : News Central