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Diamond Sales Fuel Botswana Budget Surplus as Buyers Shun Russia

Diamond Sales Fuel Botswana Budget Surplus as Buyers Shun Russia
An employee inspects a selection of uncut diamonds. (Photo: Chris Ratcliffe/Bloomberg via Getty Images)
By Bloomberg
09 Jan 2023
0

Botswana posted a budget surplus for the six months through September, driven by surging demand for diamonds as buyers flocked to the African nation and avoided Russia following its invasion of Ukraine.

The southern African nation recorded a budget surplus of 598.7 million pula ($46.9 million), or 0.55% of gross domestic product, in the first half of the fiscal year ending March 2023, the finance ministry said Monday in an emailed statement. The positive balance was driven by a 66% increase in mineral revenues, largely due to improved diamond exports.

Read: Botswana Seeks Wider Diamond Industry Role as Russia Hobbled

Debswana, a joint venture between the government and Anglo American Plc. unit De Beers that mines most of the nation’s gems, sold 54.9 billion pula of rough diamonds in the 11 months through November 2022, central bank data show. That compares with 38.1 billion pula in 2021, which was the most since 2016.

Despite the improvement, the ministry’s forecast for a budget deficit of 7.7 billion pula, or 3.4% of GDP, for the current fiscal year remains unchanged. Finance Minister Peggy Serame may revise the estimate in her budget speech due next month.

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