Category: Sunday Standard

Despite repeated talk of economic recovery and transformation, Botswana remains firmly trapped in the grip of the diamond downturn.

The Bank of Botswana says weak global demand for diamonds, shifting consumer preferences and slow progress in economic diversification continue to weigh heavily on growth, exposing the country’s enduring dependence on its most important export.

In its April Monetary Policy Report, the central bank said overall economic performance remains weak, constrained by subdued global conditions, structural challenges in the diamond sector and sluggish transformation efforts.

Botswana’s economy contracted by 0.7 percent in 2025, following a 2.8 percent contraction in 2024, underscoring how the economy has struggled to regain momentum even as parts of the non-mining sector continue to expand. Mining GDP fell 14 percent last year, while diamond mining alone contracted 14.9 percent.

The central bank’s assessment offers a sobering reminder that Botswana’s diamond problem is no longer merely cyclical.

Global rough diamond prices fell 4.5 percent in the first quarter of 2026 as weak demand, excess inventories and persistent uncertainty continued to pressure the market. The report also flagged the growing threat from lab-grown diamonds, which now account for an estimated 20 to 25 percent of market share, particularly in lower-value segments.

The fallout is already showing in public finances.

Lower mineral revenues have forced the government to widen its budget deficit projections, while the central bank warns that continued diamond weakness could deepen fiscal pressures, strain foreign exchange reserves and complicate recovery efforts.

For all the rhetoric around diversification, the Bank’s message is unmistakable: Botswana remains dangerously exposed to a diamond industry undergoing structural change and time is running out to build a credible alternative.

Botswana’s worsening fiscal position is emerging as a growing threat to economic recovery, with the Bank of Botswana warning that rising government borrowing could drain liquidity from the financial system and squeeze credit to businesses.

In its April Monetary Policy Report, the central bank painted a picture of an economy facing pressure from multiple fronts: weak growth, rising inflation, tighter liquidity and an expanding government financing gap.

While public attention has largely focused on inflation and the recent interest rate increase, the deeper concern may lie in the state’s increasing appetite for debt.

The revised 2025/26 budget projects a deficit of P25.5 billion, equivalent to 9.3 percent of GDP, up from the original estimate of P22.1 billion, largely due to weaker mineral revenues as the diamond market remains under pressure. For 2026/27, the deficit is projected at P26.4 billion.

With government investment balances critically low and part of the financing gap still unfunded, authorities are leaning more heavily on borrowing, including domestic debt instruments.

For the central bank, that carries consequences.

The report warns that greater government borrowing could crowd out private sector access to credit at a time when businesses already face tight liquidity and slowing economic activity. Commercial bank credit growth slowed to 2.6 percent in February, down from 5.8 percent a year earlier, suggesting lending appetite is already weakening.

The Bank’s decision to raise the monetary policy rate by 200 basis points to 5.5 percent was partly aimed at improving monetary policy transmission in a strained liquidity environment, not simply containing inflation.

For Botswana’s private sector, the risk is straightforward: as government borrows more to stay afloat, less room may remain for businesses trying to fund expansion, investment and survival.

Botswana’s inflation rate surged into double digits in April, delivering a sharp cost-of-living shock that could complicate the Bank of Botswana’s policy path in the months ahead.

Latest figures from Statistics Botswana show annual inflation accelerated to 10.3 percent in April, up from 4.2 percent in March, marking one of the steepest month-on-month jumps in recent years.

The spike was overwhelmingly driven by transport costs after the March fuel price adjustment filtered through the economy and public transport operators raised fares from the start of April.

Transport alone contributed 7.4 percentage points to the inflation figure, dwarfing all other categories. The transport index rose 21.1 percent in a single month, with the cost of operating personal transport climbing 33.8 percent, while transport services rose 16.6 percent.

The data underscores how vulnerable Botswana remains to imported inflation shocks. Imported tradeables inflation climbed to 17.8 percent, from 6.6 percent in March, reflecting the pass-through effect of higher fuel and import costs.

Rural households appear to have taken the hardest hit, with inflation in rural villages reaching 11.8 percent, compared to 10.1 percent in urban villages and 9.6 percent in towns and cities.

Beyond transport, inflation pressures are broadening. Insurance costs jumped 13 percent, helping push miscellaneous goods and services up 6.8 percent.

More worrying for policymakers, core inflation is beginning to stir. Trimmed mean core inflation rose to 8.8 percent from 4.8 percent, suggesting price pressures are spreading beyond one-off administered increases.

For households already stretched by stagnant incomes, April’s inflation print signals that the squeeze is no longer confined to the petrol station – it is moving across the economy.

Shrinking government to allow the private sector to grow should be our nation’s motto. That is how it works and has worked all over the world. Even those nations frequently held up as paragons of welfare and compassion have moved on.

You see the cash crunch we are facing with your own eyes. Go to a government building for a meeting, and you see things for yourself. They can’t even serve you bottled water. They are unable to serve simple refreshments, even though that was not always necessary in many cases. So the signs of the cash crunch are out there for everyone to see.

But the long and short of this cash crunch is that, over time, the public sector has become outsized. There is no running away from that. This is where the correction needs to take place. And we all understand that the correction is bound to be painful. Over time, many in this country have behaved as though the government, by nature, has a perennial source of funds. They never imagined that the government could one day run short of money, despite repeated warnings from esteemed international organisations.

They saw countries in the region struggle, with some even failing to pay salaries on time but could not conceptualise that, something that happens to a country that has a large and unproductive public sector compared to the private sector. You need a bigger private sector simply because that is where wealth creation occurs. The bulk of the stuff they do in government adds little to wealth creation.

We have resisted calls to reduce the public sector. And we have even turned the notion of the privatisation of state-owned enterprises into a secular heresy. The very mention of the name privatisation is akin to using a swear word. However, no one gains out of this state of affairs. No one gains from continuing to bury their heads in the sand.

The cash crunch is apparent when you visit public schools or hospitals. The schools are in disrepair, while the ability of some hospitals to provide nutritious food to patients is at risk of being compromised. Surely this is not where we want to be.

There is a tendency among the professional class in government to try to sit out the current crisis, hoping that the situation will somehow improve. While hope is a good virtue, it is not a strategy.

The strategy for turning the situation around should follow what others have done around the world. Sweden is a case in point. We see Sweden and its fellow Scandinavians as our default example of the beauty of big government. However, Sweden has moved on since electing a market-oriented prime minister.

They have embarked on a series of reforms that have borne fruit. They have reformed the pension systems, reduced unsustainable unemployment benefits, reduced business red tape and cut corporate tax to attract investment. The tax cuts have led to the return of entrepreneurs who had fled Sweden’s notoriously punitive taxes. They have allowed the private sector to take over failing public schools and hospitals.

So this shows that a large public sector weighs down on growth and prosperity and needs to be pared back, irrespective of whether you are in Sweden or Botswana.

Access Bank Botswana has delayed the release of its audited financial statements for the year ended December 2025, citing an unresolved audit matter that remains under review.

In an update to shareholders, the Botswana Stock Exchange-listed lender said publication of the results has been pushed back because of what it described as a ‘single open matter’ still being assessed as part of the audit process.

The delay extends uncertainty around the bank’s annual performance, particularly as listed companies are expected to publish audited financial statements within regulatory timelines.

Access Bank, however, sought to calm investor concerns, insisting the unresolved issue does not affect the bank’s underlying financial performance, capital adequacy, liquidity position or its ability to continue operating as a going concern.

The lender did not disclose the nature of the outstanding matter, leaving the market with limited clarity on what has held up the final audit sign-off.

The latest announcement follows an earlier cautionary notice issued on March 27 and a subsequent update on April 15, suggesting the delay has persisted for several weeks.

The board said management remains committed to governance, transparency and regulatory compliance, adding that the audit process is expected to be concluded on or before June 3, 2026.

Until then, shareholders have been advised to exercise caution when dealing in the bank’s securities.

While the bank’s reassurance may temper immediate fears over financial distress, prolonged delays in audited reporting tend to unsettle investors, particularly when details of the unresolved issue remain undisclosed.

For a bank, where confidence is currency, opacity can prove almost as damaging as weak numbers.

The focus will now shift to whether Access Bank meets its revised deadline and whether the eventual results provide clarity on what triggered the hold-up.

Botswana’s small businesses in the catering and butchery sectors are coming under mounting pressure as the suspension of slaughtering cloven-hoofed animals following the Foot-and-Mouth Disease (FMD) outbreak disrupts beef supply chains and pushes operating costs higher.

For many small, medium and micro enterprises, beef shortages are no longer just a supply issue – they are becoming a survival issue.

Botswana Informal Sector Association secretary general Mpho Matoteng says the month-long restrictions have left many small operators scrambling to source beef from FMD-free zones, a process that comes with added transport costs, permit requirements and reduced margins.

‘Business is difficult for our people at the moment because beef is scarce,’ Matoteng told Sunday Standard.

‘For those who have been able to secure it, they have to navigate the complexities of obtaining permits and transporting slaughtered meat. This comes with significant costs.’

The strain is beginning to show across the informal food economy, where small caterers and butcheries depend heavily on affordable and predictable beef supply.

Some businesses have responded by raising prices to protect already thin margins. Others have simply shut their doors.

‘While some have opted to increase food prices, others have unfortunately shut down their businesses,’ Matoteng said.

The situation has been compounded by higher prices at the Botswana Meat Commission, leaving smaller operators with few affordable alternatives.

The outbreak’s consequences extend beyond local lunch counters and butcher blocks. Botswana’s beef export access to the European Union has also come under threat after the outbreak affected Zone 11, home to the country’s only EU-approved slaughter facility in Ramatlabama.

For SMMEs, however, the immediate concern is cash flow.

Toronto-listed junior explorer One Bullion says new high-grade assay results from its Vumba Project are strengthening the case for a potentially significant gold discovery in Botswana, as exploration interest builds in the country’s underexplored greenstone belts.

The company reported gravity-finish re-assays from five previously over-limit samples, returning a top grade of 30.8 grams per tonne gold, alongside results of 22.2 g/t, 17.55 g/t and 11.0 g/t.

The samples were collected from artisanal pits, stockpiles and dumps at Vumba and followed earlier fire-assay results that had exceeded the 10 g/t reporting threshold.

While the grades are considered strong by exploration standards, One Bullion cautioned that the results are based on selective grab sampling rather than a formal mineral resource estimate.

Still, the company believes the results are encouraging.

One Bullion said the mineralised samples span multiple artisanal workings and geological host structures across roughly 2.5 kilometres of strike, suggesting the mineralisation may extend beyond isolated pockets.

That matters because continuity is what turns interesting geology into a viable mining story.

Chief executive Adam Berk said the latest results reinforce the company’s view that Vumba hosts meaningful high-grade mineralisation warranting further work, including drilling.

The company had earlier reported visible gold and selective grab samples grading as high as 679 g/t and 207 g/t, figures that drew attention despite the early-stage nature of the exploration programme.

Beyond Vumba, One Bullion said Botswana’s environmental authorities have approved the Environmental Impact Statement for its Maitengwe Exploration Project, clearing another hurdle for exploration activity.

The developments come as Botswana seeks to revive gold exploration following the closure of Mupane Gold Mine in March 2024.

The medal count continues to rise for Botswana at the ongoing African Athletics Championships in Ghana. Glory and national pride, as expected, beckons.

Beyond the medals however, greater value lies elsewhere. According to the team management, the country’s greatest victory lies in the valuable experience gained by its young athletes competing on one of Africa’s biggest stages.

Team manager Keabetswe Friday says the championships have highlighted both the country’s growing strength and the areas that still require improvement if Botswana is to consistently compete among Africa’s athletics elite.

According to Friday, Botswana’s technical team deliberately set an ambitious target of four gold medals to challenge athletes mentally and physically against the continent’s top competitors. As of Thursday, Botswana had secured two gold medals and four silver medals, remaining firmly in contention to reach that target.

The gold medals came through Lee Eppie in the men’s 400 metres and Kemorena Tisang in the men’s 400m hurdles.Silver medals were won by Victor Ntweng in the men’s 400m hurdles, Oratile Nowe in the women’s 800 metres, Obakeng Kamberuka in the women’s 400 metres, and Botswana’s mixed 4x400m relay team.

Despite the encouraging performances, Friday admits that the championships also revealed important lessons for Botswana’s developing athletes, particularly when competing under pressure at senior level.

‘The competition showed us where we still need improvement, especially with young athletes competing at senior level. One of the biggest challenges was handling pressure on the big stage and maintaining a strong finish. Justice Oratile impressed in the heats but struggled in the final, while Oratile Nowe narrowly missed gold at the finish line,’ he says.

However, the team Botswana manager stresses that such moments should be viewed as part of the athletes’ growth and development rather than setbacks. He notes that Botswana’s 100m athletes did not perform as expected. That said, he believes the competition offered younger athletes a valuable opportunity to learn and gain confidence competing against experienced continental stars.

Friday adds that Botswana’s progress remained encouraging, especially considering that some athletes competing in Ghana had recently been participating in school sports and were now stepping up in the absence of more experienced athletes.

He also praised Botswana’s mixed 4x400m relay silver medal, saying the women’s side had improved significantly after years of development. The result, he says, boosted Botswana’s hopes of qualifying for the World Championships.

The performances of athletes such as 4x400m mixed relay Karabo Mantswinyane and Kamberuka were highlighted as signs that Botswana’s women sprinters are steadily improving and growing in confidence at continental level.

Friday further says, ‘Eppie’s development within Botswana’s relay programme, transitioned him into a full-time 4x400m athlete had contributed greatly to his gold-medal performance. Exposing young athletes to elite competition now would strengthen Botswana’s future relay teams and improve competition for national team call ups at the highest level.’

Scores of Batswana are reportedly fleeing to Europe as worsening economic conditions coupled with rising unemployment and declining mineral revenues push desperate citizens to seek survival abroad, a new government report has revealed.

The findings are contained in the National Voluntary Report of the Republic of Botswana on the Implementation of the Global Compact for Safe, Orderly and Regular Migration (GCM), which was compiled by government institutions, the private sector and Non Governmental Organizations (NGOs).

The report details how the country is increasingly losing its skilled workforce and young people to foreign labour markets.

‘In more recent years, Botswana has experienced an increase in outward migration, especially to Europe, driven by perceived economic opportunities, access to specialised skills markets and better health care systems abroad,’ the report states.

The report links the migration surge to Botswana’s deteriorating economic climate, characterised by sluggish growth, fiscal strain and falling diamond revenues.

‘Botswana’s migration patterns are occurring within a broader macroeconomic context characterised by periods of low and declining economic growth, increased fiscal pressures, and a decline in mineral revenue,’ reads the report. The report further states that it echoes warnings previously raised in the 2026 Budget Speech by the Ministry of Finance.

‘ These structural factors continue to influence labour mobility and migration decisions amongst Batswana,’ the report says.

The findings come at a time when thousands of unemployed graduates and skilled professionals are increasingly vocal about shrinking opportunities in Botswana with social media flooded by advertisements for jobs, scholarships and relocation opportunities in Europe.

The report says economic hardship and soaring youth unemployment are now among the biggest drivers of migration.

‘Some of the drivers of outward migration in Botswana are high levels of unemployment, especially among the youth, as well as the perceived availability of better economic opportunities abroad,’ the document states.

The government also admits that the growing desperation among young people is exposing them to criminal syndicates and human traffickers who prey on vulnerable job seekers.

‘The increase in migration of Batswana has presented the country with several challenges, one of which is human trafficking and the exploitation of vulnerable groups,’ the report warns.

Botswana has now been identified as a ‘source, transit and destination country’ for human trafficking victims, particularly women and children.

The report reveals that young Batswana are increasingly falling victim to deceptive recruitment schemes, fake overseas job offers and online fraud linked to international trafficking networks.

‘The country continues to face emerging risks and threats relating to the exploitation of young people, including deceptive recruitment practices, misinformation and online fraud, which have subjected Batswana to human trafficking,’ the report states.

The migration report warns that labour mobility is no longer being driven solely by ambition, but increasingly by economic distress.

‘It is apparent that migration dynamics are now shaped by economic pressures, youth unemployment, and emerging challenges such as recruitment risks and transnational organised crime,’ the report says.

Suggesting that economic hardship is fuelling the crisis, the authors of the report urged the government to urgently invest in prevention measures before the situation worsens.

‘The Government must continue to invest in ethical recruitment approaches, public awareness campaigns, early detection and warning systems, and youth employment initiatives so that there can be a reduction in vulnerabilities and migration-related risks,’ the report says.

It adds: ‘Investing in preventative approaches is more cost-effective than investing in response measures.’

The current shortage of medical supplies in healthcare facilities country wide is exposing nurses to abuse from patients. Nurses and Mid-wives are often the first point of contact for patients and they have to bear the anger, frustration and disappointment of the public over circumstances beyond their control.

The revelation was made by Botswana Nurses Union(BONU) President Oreeditse Kelebakgosi during the commemoration of the Botswana Nurses Day in Shakawe village last week. He reiterated that the worsening situation has left many nurses and midwives vulnerable to abuse which includes insults, intimidation and in some cases, threats from members of the community.

Botswana has faced a severe, on going shortage of essential medicine supplies in public health facilities throughout 2025 and 2026. Shortages include chronic illness medications for diabetes, cancer treatment, TB and HIV/Aids.

Kelebakgosi said it was deeply unfair for health professionals who continue to serve with dedication under difficult conditions in the quest to save lives to become targets of frustration caused by systematic failure and challenges.

‘The theme today caters for fair wages, safe working conditions, adequate staffing and commitment to nursing education and training as well as respect for the nursing profession. A nurse must not beg for better conditions of services looking at the delicate role that they play in communities, individuals and national health,’ he said.

He emphasized that when nurses are empowered, lives are saved and the nation stands stronger and healthier. He stated that there is need of provision of resources for delivery of quality health care services.

Among other important issues, Kelebakgosi said one other critical path to empower nurses and midwives lives is the ratification and domestication of the ILO Nursing Personnel Convention, 1977(No.149). He said it is worrisome that Botswana remains among the few nations yet to take this progressive step.

‘The convention sets out clear standards on fair working conditions, adequate staffing, professional development and the protection and dignity of nursing personnel,’

‘By aligning our national laws and policies with this global framework, we would not only safeguard the welfare of our nurses and midwives but also strengthen the quality of care delivered to our people, hence saving lives,’ said Kelebakgosi.

BONU has also implored government to employ and absorb nurses and midwives across Botswana. There are currently 797 nurses and midwives who are unemployed. Kelebakgosi demanded immediate action to address staffing gaps in all government health institutions. He added that the current situation undermines quality health care for every citizen. He further called for government to review the Nursing and Midwifery Acct and its regulations.

‘It has been years since the Nursing and Midwifery Act and its regulations were reviewed, we call for their finalization. Please monitor this institution closely as it faces urgent challenges that require attention,’ said Kelebakgosi.

He also urged government to upgrade some primary hospitals to District hospital status with proper equipment and specialist personnel to save lives, improve access, and ensure timely service delivery.