Botswana’s Finance Minister, Peggy Serame, has announced plans to cut spending on government vehicles, workshops, and travel due to a significant drop in diamond revenues. According to the minister, the drop in revenue could also lead to a delay in capital projects. Botswana derives the bulk of its revenue, between 30% and 40%, from diamond sales, as well as a third of its national output. Beyond these, the Southern African nation also relies on diamond sales for 75% of its foreign exchange earnings. However, diamond sales fell by 49.2% in the first half of 2024 due to several reasons, including weak demand from the crucial Chinese market. The decline in sales resulted in a 28% drop in budgeted revenue for the first fiscal quarter, which began in April, negatively impacting the country’s finances and necessitating the proposed cuts.
SOURCE: BUSINESS INSIDER
Diamond Revenue Decline Forces Botswana to Tighten Government Spending
