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Botswana diamond exports drop by 68% in second quarter of 2020

Demand for the country’s diamonds has been hit by the coronavirus disease while global travel restrictions also hurt trading

Botswana’s diamond exports fell 68% in the second quarter of the year, data published by the country’s central bank has shown.

The central bank report showed exports of diamonds from Debswana, a joint venture between the country and the diamond mining giant De Beers, stood at US$293 million in the second quarter of 2020, down from $916 million in the first.

The data also showed that there were no diamond exports recorded in May 2020 and only $20 million worth of diamonds was exported in June.

The fall in diamond exports is expected to hurt Botswana’s balance of payments deficit, as diamonds constitute 70% of the country’s exports.

Since diamonds were discovered in Botswana, they have moved the country from being one of the poorest countries in Africa to one of the most successful medium-sized economies, with more than 80% of diamond profits staying in the country.

Double-digit contraction

Diamond exports account for 70% of revenue generated in Botswana. The income benefits citizens through free education, free health care and expansion of local jobs in the diamond industry.

With the spread of the novel coronavirus, Botswana closed its borders in March, keeping out international buyers from Mumbai, Antwerp and China who used to travel to Gaborone ten times a year to view and buy diamonds.

Speaking in April, Botswana’s finance minister, Thapelo Matsheka, said that the country’s economy will shrink by roughly 13% this year while the mining sector contracts by 33% in 2020, with diamond revenues falling to about $567 million, considerably lower than the original forecast of about $1.7 billion. 

So far, Botswana has recorded just 800 confirmed cases of COVID-19 and two deaths, but its economy has been severely damaged by the global spread of the disease.

Botswana closed its borders in March as a way of curbing the virus.

* Asaase Radio 99.5 – tune in or log on to broadcasts online.

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