• Diamond sales drop 50%, pushing Botswana into fiscal and employment strain
• Debswana to cut 1,000 jobs as government and De Beers launch talent programs
• IMF forecasts -0.4% GDP growth in 2025, citing lack of diversification

The Botswanan government and De Beers launched on June 10 several national talent development programs. The initiatives, part of a broader partnership signed in February 2025, aim to support workforce readiness amid falling sales, which have dropped by more than 50% in two years. Although the programs target youth unemployment, authorities are primarily responding to the wider economic strain caused by the diamond sector downturn.

The initiatives include scholarships, international and local internships with De Beers, and plans for a new vocational training institute focused on diamond-related skills. However, while these programs aim to build talent, De Beers is also preparing to significantly reduce its workforce.

In May, President Duma Boko announced that Debswana, the 50/50 joint venture between Botswana and De Beers, would lay off 1,000 employees. This represents nearly 20% of Debswana’s staff and marks a major blow in a country where the unemployment rate stood at over 27% in Q1 2024. The cuts follow De Beers' decision to scale back production amid continued weak demand.

Botswana's problems extend beyond job losses. De Beers' rough diamond sales dropped from $6 billion in 2022 to $2.7 billion in 2024. As the company supplies nearly all of the country's diamond output, this decline is reducing fiscal revenues and widening the budget deficit. The government now faces a choice between spending cuts and rising debt.

According to the World Bank, the budget deficit for FY2o024-25 is estimated at 9.2% of GDP, with spending increasing by 7.5% of GDP in the past two years and diamond revenues disappointing (down 50.7% in 2024/2025). The IMF, for its part, projects that Botswana's economy will contract for a second year in a row. GDP is expected to fall by 0.4% in 2025, after shrinking by 3% in 2024. These figures sharply contrast with the government’s earlier projection of 3.3% growth in 2025.

The IMF warned that Botswana’s dependence on diamonds could hurt long-term growth due to falling reserves, increased competition from synthetic diamonds, and the effects of Dutch disease. It also cited persistent inequality and high unemployment.

In response, the country has increased efforts to diversify its economy. Botswana is investing in copper and uranium mining, promoting agro-industry, leveraging the African Continental Free Trade Area (AfCFTA), and exploring opportunities in technology and innovation.