Editor’s Note
Botswana’s diamond stockpile has grown to nearly double its target level due to sustained low prices, constraining the country’s ability to boost production and economic growth in the near term, according to the finance ministry.
GABORONE, Jan 20 (Reuters) – Botswana’s diamond stockpile is nearly double its target inventory levels amid persistent low prices, leaving the country unable to increase gem production in the short term to lift its economy, the finance ministry has said.
Botswana’s economy was expected to shrink by almost 1% in 2025 following a 3% contraction the year before, largely due to the collapse of diamond prices under pressure from lab-grown gems and weak global demand.
The price slump forced miner Debswana, Botswana’s joint venture with De Beers which accounts for 90% of the country’s diamond sales, to temporarily suspend production at some of its mines last year.
Botswana produced 18 million carats of diamonds in 2024, only second to Russia, according to the Kimberley Process Certification Scheme.
It had a stockpile of 12 million carats at the end of December 2025, according to the finance ministry’s 2026/27 Budget Strategy Paper seen by Reuters on Tuesday, nearly double the government’s allowable inventory level of 6.5 million carats.
Limited scope for increased output will constrain the economy, unless the non-mining sector performs strongly, it added.
Diamonds normally contribute around one-third of Botswana’s national revenues and three-quarters of its foreign exchange receipts.
Botswana’s exports to the U.S., including diamonds, now face a 15% tariff. Higher tariffs imposed on major diamond consuming markets such as India could prolong lower gem prices and squeeze profit margins, the ministry added.
Botswana’s mineral revenues are estimated to reach 10.3 billion pula ($729.24 million) in 2025/26, compared to a historical annual average of 25.3 billion pula, reflecting lower diamond sales.