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Diamonds Grown in Labs Threaten Botswana’s Economy

15 Sep 2025 GS 3 Economy
Diamonds Grown in Labs Threaten Botswana’s Economy Click to view full image

Background:

  • Botswana, 70% desert, was lifted from poverty by diamond discoveries in the 1960s.

  • Diamonds remain its main source of income, contributing 30% of GDP and 80% of exports (IMF).

Crisis:

  • Lab-grown diamonds from China and India are cheaper and increasingly popular.

  • Natural diamond prices are falling: from $6,819 (May 2022) to $4,997 (Dec 2024) per carat (World Diamond Council).

  • Botswana and other southern African nations (Angola, Namibia, South Africa) are exposed, but Botswana most heavily.

Responses by Botswana:

  1. Sovereign Wealth Fund launched – to diversify and build resilience beyond diamonds.

  2. Exploring new sectors:

    • Luxury wildlife tourism

    • Medicinal cannabis industry

    • Solar power generation (abundant sunshine).

  3. Political initiative: President Duma Boko suggested taking majority stake in De Beers and selling diamonds independently.


World Diamond Council (WDC)

Establishment & Background

  • Founded: July 2000 in Antwerp, Belgium.

  • Founding bodies:

    • World Federation of Diamond Bourses (WFDB) – global trading centres.

    • International Diamond Manufacturers Association (IDMA) – manufacturers.

    • Later joined by International Confederation of Jewellers (CIBJO).

  • First President: Eli Izhakoff (2000–2013).

  • Current President: Edward Asscher (Amsterdam, Netherlands).

  • Headquarters: United States.

Purpose

  • Created to ensure the diamond supply chain is free from conflict diamonds (also called blood diamonds).

  • Represents the entire diamond value chain: mining, manufacturing, trading, retail.

UN & Kimberley Process

  • December 2000: UN General Assembly passed a resolution supporting an international certification scheme for rough diamonds.

  • 2002: Governments, industry, and civil society negotiated the Kimberley Process Certification Scheme (KPCS).

  • 2003: KPCS came into force – requires strict documentation to regulate rough diamond trade.

  • Impact: Reduced “conflict diamonds” to less than 1% of global production.

Role of WDC

  • Has representation in all Kimberley Process working groups.

  • Influential in implementation and reform of KPCS.

  • Advocates transparency, traceability, and responsible sourcing in global diamond trade.



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