The Exception to the Rule

“Botswana is what it is because of diamonds.”

-Festus Mogae,
Former President of Botswana


Botswana is a landlocked country in southern Africa. Botswana was a British territory known as Bechuanaland until it gained independence in 1966 and became known as Botswana. The first president was Sir Seretse Khama who served fourteen years as president until his death in 1980. Sir Khama’s son Ian Khama became the president of Botswana in 2008, when then president Festus Mogae graciously retiring after serving for ten years, which is a rare occurrence in African politics.
Upon its independence most of the people survived by raising cattle since agriculture is limited by the sand that covers most of Botswana. This feeble economy was often susceptible to crisis because of frequent draughts in the region. But, with the discoveries on several diamond mines the fate of Botswana changed dramatically. Diamonds are the only reason that Botswana is one of the richest countries in sub-Saharan Africa instead of one of the poorest.
Many African Nations have the "oil curse" or a similar situation with gems or precious metals; however Botswana is one of the few nations which has utilized their resources for the betterment of the country and the people. Botswana has become an exemplar of the success and stability that mineral-rich African nations are capable of and should strive for. Botswana is one of the only economically, politically, and socially stable countries in sub-Saharan Africa. Botswana is the largest diamond exporter in the world and most mining operations are run by the government. Moreover, with only 1.8 million people, Botswana’s per capita income is four times the regional average at $5,900 per capita and taxes are also among the lowest as well. In addition, the government in Botswana has been able to avoid corruption and properly allocate its funds. Botswana government has spent its diamond revenues on building schools, clinics, roads, and sanitation.


Diamonds and the Economy


Upon Botswana’s independence most of the people survived by raising cattle since agriculture is limited by the sand that covers most of Botswana because of the Kalahari Desert. This feeble economy was often susceptible to crisis because of frequent draughts in the region. But, with the discoveries on several diamond mines the fate of Botswana changed dramatically. Diamonds are the only reason that Botswana is one of the richest countries in sub-Saharan Africa instead of one of the poorest.
Botswana’s government has partnered with De Beers, which controls more than seventy percent of all diamond worldwide. This partnership is responsible for the production of almost all of Botswana’s diamonds. Unfortunately this causes the government to become the sole driving force behind Botswana’s economy, since the private sector. This realization is a concern for Botswana’s economical future, since diamond production in Botswana will plummet in the next fifteen to twenty years barring the discovery of new mines.[i]
Before Botswana picks its diamond mines dry it must find a way to diversify its economy much as Algeria has succeeded in doing. If Botswana cannot diversify its economy it will plunge into a depression, which could cause a civil war and result in the destruction of Botswana’s reputation of stability that Botswana’s government has worked so hard to establish. Currently the only thing that Botswana’s economy can fall back on is Botswana’s large coal reserves, which are similarly limited. Botswana’s government has announced that it plans to build power stations, which would be a sustainable source of income for Botswana.
There are also other economic issues that currently face Botswana. Aside from mining companies interested in diamonds Botswana has been unable to appeal to foreign companies and investors. Botswana’s government has tried to appeal to foreign investors with its low taxes and labor costs. Additionally, unemployment is roughly eighteen percent and the income gap between the people in the cities and those in rural regions of Botswana is large and growing.
[i] Economist southern star