Editor’s Note
Botswana is moving to diversify its mining sector beyond diamonds, as detailed in this report from the Investing in African Mining Indaba. The government aims to boost exploration, particularly for critical minerals, to counter fiscal pressures and unlock new economic potential.
Botswana has decided to expand its mining agenda beyond diamonds. This decision comes amid a cycle of weakness that is pressuring public revenues, reserves, and growth. The Minister of Minerals and Energy, Bogolo Joy Kenewendo, said in Cape Town that the country plans to intensify exploration, including the critical minerals segment, to cover the 70% of the territory that remains unexplored.
The announcement was made at the Investing in African Mining Indaba conference, a key meeting point for governments and companies in the sector. Botswana’s message points to a risk the market has already priced in: concentration on a single product exposes a country to demand, price, and technology shocks. Diamonds have been the heart of the Botswana model for decades, but that very success has raised the cost of not diversifying.
The magnitude of the dependence explains the urgency. In recent years, various estimates have placed diamonds as the largest source of foreign exchange and a relevant component of state revenues. Reuters reported that diamonds contribute about 30% of government revenue and around 75% of foreign exchange earnings. In parallel, the World Bank has warned that the weight of diamonds in exports and public finances leaves the economy exposed to structural changes in the global market.
The adjustment is already reflected in operations and public accounts. Debswana, the joint venture between the government and De Beers, cut production and halted activities at specific assets to respond to weak demand and control costs. De Beers itself has described difficult trading conditions in its fourth-quarter 2025 report.
At the same time, the accumulated inventory illustrates the slowness of the recovery. Reuters reported that the country had a stockpile of 12 million carats at the end of December 2025, nearly double the level allowed by its own inventory framework. This accumulation affects cash flow, revenue collection, and the pace of public investment.
The situation has also filtered into the macroeconomic narrative. In the budget presented in early February, the government projected a growth rebound in 2026, after estimated contractions in 2024 and 2025, but acknowledged the impact of the diamond slump. In 2025, Moody’s downgraded Botswana’s rating and attributed part of the adjustment to the difficulty of adapting to a more structural deterioration in the diamond market.
Not all the problem stems from a single factor. Weak demand in China and competition from lab-grown diamonds have changed the commercial conversation. Reuters cited the industry as pointing to falling prices and pressure from the market share of synthetics. De Beers and its parent company have acknowledged the hit with value revisions and signs of financial caution.
In this context, Botswana is betting on a classic lever to attract mining capital: information. Kenewendo said the country has explored only a part of its territory and now wants to change the focus that for decades privileged diamonds. The strategy includes collecting geological data in greater detail and reducing the initial risk for investors, which often concentrates on subsurface uncertainty.
The plan has economic logic. In exploration, information asymmetry raises the cost of capital and reduces appetite for greenfield projects. A state can improve entry conditions without replacing the investor by accelerating mapping, geochemistry, and public data registration. According to Reuters, Botswana is seeking exactly that with a state-led exploration initiative.
Policy is also accompanying this shift. In 2024, the country proposed reforms to expand local participation in mining projects. Reuters reported on a draft that seeks to have mining companies offer a relevant stake to citizens or local companies when the government does not exercise its current acquisition right. Such measures typically improve social acceptance but also require clear rules to avoid increasing regulatory uncertainty.
The diversification does not start from zero. The Kalahari Copper Belt already operates as an emerging hub. Sandfire started up Motheo and reported operational and logistical progress in its quarterly reports. In the same corridor, Khoemacau stands out for its scale and growth potential. MMG has communicated that its studies point to an expansion exceeding 130,000 tons of copper annually, with associated silver production, and has described predominantly local employment in Botswana.
This copper block matters for a simple reason: copper underpins power grids, renewables, electric vehicles, and data centers. Global demand does not depend on a single fashion trend. It depends on infrastructure. This difference reduces some of the typical volatility of luxury goods, although it does not eliminate price cycles. The takeaway for Botswana is clear: adding copper can cushion blows from diamonds, but it requires sustained investment and long timeframes.