Botswana’s leading diamond companies have stopped production at some mines because of weak demand worldwide.
Debswana, a partnership between the Botswana government and mining giant De Beers, reported a nearly 50% drop in sales revenue last year.
Botswana is the world’s largest diamond producer by value. The diamond sector makes up about a quarter of the country’s annual GDP, according to the International Monetary Fund.
This year, Debswana plans to reduce diamond production to 15 million carats, about 40% less than in 2023.
The company sells around 90% of Botswana’s diamonds. It expects that cutting production will save money on costs like fuel and electricity.
In a statement, Debswana said it will “cautiously respond to challenging market conditions” caused by low demand and new issues like U.S. tariffs.
Since 2023, the global market for natural diamonds has shrunk partly because lab-grown diamonds have become more popular.
Last month, Debswana paused production at its two main mines, Jwaneng and Orapa. Both mines will be closed for three months in total.
Botswana has tried for many years to reduce its dependence on diamond sales, with mixed results.
Despite efforts to grow other sectors like tourism, finance, and copper mining, diamond sales still bring in about three-quarters of the country’s foreign currency.
Debswana’s mine closures could reduce this important revenue.
The company said it is offering voluntary layoffs but has no plans for forced job cuts.
A senior finance official told Reuters that Botswana will lower its economic growth forecast for 2025 to nearly zero because of the ongoing troubles in the diamond market.
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