Botswana anticipates a recovery in economic development in 2025 due to a stronger diamond market

According to a senior government official speaking at a budget workshop on Friday, Botswana’s GDP is predicted to rise 3% to 4% in 2025 after contracting last year, as the world diamond market is likely to rebound.

The GDP of this Southern African nation contracted 3.3% in the first three quarters of 2024, above the 1.7% decline that the administration had predicted in December. There was no revised contraction estimate provided.

“The domestic economy is expected to recover to a growth of 3-4% in 2025, reflecting a combination of base effects, the global recovery in the major diamond export markets, and continued growth in the non-mining sector,” stated Walter Matekane, the finance ministry’s director of macroeconomic policy.

Diamond exports account up a substantial portion of Botswana’s economy, and the country’s government expenditure has been constrained by the precious stone’s diminishing profits.

Due to poor diamond sales in 2024, Debswana, a joint venture between Botswana and De Beers, reduced their output forecast for the previous year by almost 6 million carats to 17.9 million carats.

In a presentation, Matekane stated that Botswana anticipates a rebound in mining income to reduce the budget deficit from 6.75% of GDP projected for the fiscal year 2024–2025 to 3.6% of GDP in 2025–2026.

It is anticipated that Ndaba Gaolathe, Botswana’s finance minister, would present the country’s 2025–2026 national budget in February.