Botswana Warns of Diamond Sector Strain as Lab-Grown Gems Reshape Global Market

Botswana Warns of Diamond Sector Strain as Lab-Grown Gems Reshape Global Market. Botswana’s Ministry of Finance has raised fresh concerns about the future of the country’s diamond industry, citing rising global competition from lab-grown stones and shifting demand patterns that could weigh on performance in 2026.

Speaking at the Budget Pitso in Gaborone on Monday, Dr Sayed Timuno, Secretary for Macroeconomic and Financial Policy, described the outlook for the diamond sector as uncertain. He pointed to the growing presence of lab-grown diamonds in international markets as a key factor influencing demand for natural stones.

Global figures indicate that lab-grown diamonds have gained significant traction in recent years. By 2025, these stones were projected to account for around 20 to 21 percent of the overall diamond market. Their popularity has been linked to affordability and sustainability considerations, particularly among younger consumers. The global lab-grown diamond market was valued at approximately 29 to 30 billion dollars in 2025, with further expansion expected.

Domestically, Dr Timuno highlighted rising inventory levels along Botswana’s diamond value chain. Stockpiles reportedly reached about 12 million carats by the end of 2025, marking a sharp increase compared to previous years. He contrasted this with historical production levels that once stood at around 23 million carats annually and later climbed to 28 million carats. Output fell to roughly 14 million carats last year.

He said these trends signal a structural shift in the industry and described the situation as a “new normal” that requires updated policy thinking and stronger competitiveness.

Lower prices for lab-grown stones have placed downward pressure on natural diamond prices, contributing to market volatility. Dr Timuno noted potential implications for mineral revenues, foreign exchange reserves and Botswana’s broader external sector as global demand patterns continue to evolve.