Botswana’s economy is expected to grow 3.1% in 2026, rebounding after two successive years of contraction, Finance Minister Ndaba Gaolathe said in a budget speech on Monday.
The Southern African country’s economy, long viewed as an African success story, has been hit hard by a prolonged downturn in the global diamond market, driven by economic uncertainty and the rising popularity of lab-grown stones.
Diamonds typically account for about one-third of Botswana’s national revenue and three-quarters of its foreign exchange earnings.
Gaolathe told lawmakers on Monday that without major economic reforms growth was likely to remain below potential in the short to medium term.
It was urgent to accelerate economic diversification and strengthen non-mining growth sources, he continued.
Botswana’s diamond stockpile is nearly double its target inventory levels amid persistent low prices, limiting its ability to increase production in the short term to support the economy.
