Botswana’s Economy Suffers Deeper Contraction in Q2

The economy of Botswana advanced by 8.2% year-on-year in Q3 2025, rebounding from a revised 5.2% decline in the previous three-month period. This was the first period of expansion after six consecutive quarters of contraction, marking the end of the prolonged recession. Key drivers of growth were diamond traders (88.1% vs -46.2% in Q2) and mining & quarrying (39.5% vs -37.7%), driven by a substantial rise in diamond production (+45%). Other significant positive contributions came from finance, insurance & pension funding (5.2% vs 5.4%); transport and storage (5.2% vs 4%), and accommodation & food services (4.6% vs 4.1%). Meanwhile, declines were seen in utilities (-30.1% vs -6%) and construction (-1.1% vs 0.3%). On a quarterly basis, the GDP expanded by 10.9% in Q3, the most since Q3 2020, following a revised 3.5% contraction in the previous quarter.

The economy of Botswana plunged by 5.3% year-on-year in Q2 2025, extending the downturn into a sixth consecutive quarter following a revised 0.4% decline in Q1. This was the steepest economic contraction since Q2 2020, as a prolonged slump in diamond demand pressures the economy. The mining and quarrying sector tumbled 37.8%, mainly due to a 41.3% drop in diamonds and a 2% decline in coal production. Other negative contributors included diamond traders (-46.5% vs -36.2%); water & electricity (-6.6% vs -29%) and manufacturing (-0.5% vs -1%). All other industries recorded solid growth , except construction, with marginal growth of 0.3%. On a quarterly basis, the GDP slumped by 3.6% in Q2, the most since Q2 2020, after a revised 0.2% decline in the prior period.

Botswana’s GDP contracted by 0.2% year-on-year in the first quarter of 2025, following a sharper 2% decline in the previous quarter, marking the fifth consecutive quarter of economic contraction. The downturn was largely driven by continued weakness in key sectors, including agriculture, forestry, and fishing (-3.4% vs. -2.5% in Q4), mining and quarrying (-7.7% vs. -27.3%), diamond trading (-36.2% vs. 196.2%), and water and electricity (-29% vs. 43.7%). In contrast, output in manufacturing showed a modest rebound (0.2% vs. -6.5%), while growth slowed in finance and insurance (3.9% vs. 4.7%), real estate (3.3% vs. 5%), and public administration and defense (4.2% vs. 5.9%). On a quarterly basis, the economy shrank by 0.1%, reversing the 1.3% growth recorded in the final quarter of 2024.