Monday, June 24, 2024

Diamonds powers Botswana back trade surplus  

Botswana’s trade balance which has weakened in the past years, widening the trade imbalance, and causing large drawdowns from the foreign reserves, appears to be improving, driven by a recovery in the diamond industry.

Figures from Statistics Botswana’s international merchandise trade statistics for the month of May 2022 were positive, with the country recording a trade surplus, a development that will aid the government to replenish its investment account.

According to the latest trade data, in May 2022, Botswana exported P8, 864.2 million and imported P8, 380.9 million worth of goods, resulting in a trade surplus of P483.3 million. The increase in export is attributed largely to the incline in Diamonds sales, by 39.9 percent (P2, 214.9 million) from the revised April 2022 value of P5, 550.5 million to P7, 765.4 million.

Diamond producer, De Beers – which has operations in Botswana, said recently that with Russian diamonds off-limits due to sanctions against companies, including Alrosa, demand for rough diamonds has risen this year. While the global miner, which operates the Jwaneng and Orapa mines in Botswana through Debswana Mining Company, posted a nine (9) percent fall in its quarterly production (Q2:2022) it says it still anticipates a higher annual output of rough diamonds. According to the Q2:2022 report, De Beers’s rough diamond production decreased by 4 percent to 7.9 million carats primarily due to the treatment of lower grade ore at operations in both Botswana and Canada. The Anglo American report shows that De Beers’s joint venture – Debswana Mining Company’s production in Botswana decreased by four (4) percent to 5.5 million carats due to lower grade ore processed at both Jwaneng and Orapa. Debswana’s largest diamond mine by value, Jwaneng, delivered 3.1 million carats while Orapa mine, the biggest diamond mine by area, produced 2.4 million carats.

The latest Statistics Botswana report shows that the diamonds group in its export indices accounted for 87.6 percent (P7, 765.4 million), followed by Copper with 3.4 percent (P303.7 million). Machinery & Electrical Equipment contributed 2.6 percent (P227.2 million) of total exports. At the same time, during this period under review, Botswana’s top imports diamonds (32.6 percent or P2, 735.9 million) of total imports, while Fuel and Machinery & Electrical Equipment imports accounted for 17.2 percent (P1, 438.1 million) and 12.6 percent (P1, 056.2 million) respectively. Food, Beverages & Tobacco imports represented 10.6 percent (P885.3 million) of total imports.


Read this week's paper