Botswana’s government is grappling with its most severe cash flow crisis in modern memory, as a prolonged downturn in the diamond market pushes the country deeper into recession and drains the fiscal buffers that once underpinned its financial stability.
The Ministry of Finance has revised down its 2025 growth estimate to near zero, following a 3 percent contraction in 2024. While a second consecutive year of negative growth is not confirmed, the outlook reflects mounting fiscal pressures and subdued recovery prospects. Diamond exports, the country’s primary revenue source, have remained weak since April 2024, hurt by global demand softening and competition from lab-grown stones, which now account for roughly 25 percent of the market.
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