Most African country’s are experiencing huge drop in their economy especially as exports of most of their valued resources declines. Drought in most parts of South Africa has tampered with its economy as exportation of agricultural product has declined. The falling price in crude oil has affected countries like Nigeria whose economy majorly depends on it. For Botswana, it’s the drop in its diamond exports.
Business report today says that the exports of diamonds mined in Botswana fell 38 percent to $2.4 billion last year from $3.9 billion in 2014, the southern African country’s lowest shipment of gems in six years.
From the data published by the Bank of Botswana on Monday, export value for major diamond mines in the country have not been this low since the 2009 global financial crisis when the exports were worth $1.8 billion excluding diamonds that De Beer bring into Botswana from Canada, South Africa and Namibia for aggregation before re-exportation.
According to analysts at Consultancy firm, Econsult, though the immediate economic outlook remain poor, they are optimistic about better growth of diamond industry.
“Combined with reasonably good jewelry sales over the peak Christmas period, the diamond pipeline is flowing again as demand is rising for polished goods, and this will in turn help rough demand,” analysts said.
Exports from Botswana are largely dominated by the four mines owned by Debswana.The bulk of Botswana’s diamond exports are from Debswana, a joint venture between the government and diamond giant De Beers.
De Beers has reported a more than double jump in diamond sales at its first sale of the year held in Gaborone recently.
At its first sale of 2016 held in Gaborone in January, De Beers sold $540 million worth of diamonds, representing a 117 percent leap from $248 million recorded in the last sale of a challenging 2015.
It is good that Botswana’s economy has recovered from the global economic crisis as it’s real GDP growth is projected to moderate slightly during 2015-16. But experts say these growth will primarily be driven by the non-mining sectors including trade and tourism, as well as financial and government services.