Botswana is often told as a positive story within the African continent.

Relatively stable democracy, sustained growth for decades, investment in education and infrastructure.
Above all, the image of a country that has been able to manage a resource that is by definition risky, diamonds, without slipping into that curse that elsewhere has produced corruption, conflict and stagnation.

The comparison with neighbouring countries shows this clearly: Zimbabwe, Zambia and Namibia share the same regional space and partly similar structural conditions but have experienced recurring crises.
Botswana has combined fiscal discipline, institutional stability and relatively orderly management of government revenues. This is also why, for years, it has been referred to as a positive exception in the African picture.

Today, that narrative is being tested by a combination of market and geopolitical factors.
Diamond exports fell dramatically in 2025, with an estimated collapse of around 50 per cent in the second quarter (according to data reported by Agenzia Nova).
The international price of natural stones is weak, competition from synthetic diamonds is growing, and the trade policies of major partners weigh more heavily than in the past. These include the US tariff regime that has made access to the US market more expensive, with immediate effects on an economy heavily dependent on the sector.

It is in this context that the Gaborone government announces the opening of a new embassy in Moscow and invites Russian investors to consider opportunities in diamonds and so-called rare earths.
The news is quickly read as a sign of a shift towards the Russian orbit. In reality it tells of something more complex: a country that sees its main income shrinking is trying to build alternatives and obtain negotiating margins both towards Washington and other possible partners.

To understand what is really at stake, it is worth looking at the theoretical framework proposed by Daron Acemoglu and James A. Robinson in Why Nations Fail.
The real question, the authors explain, is not about the amount of resources available. It is about who controls the rents and by what mechanisms the benefits of growth are distributed.
Inclusive institutions broaden participation, protect property rights, promote competition and enable innovation. Extractive institutions, on the other hand, concentrate power and rents in a few hands, block new entrants and turn wealth into an instrument of political control.

Debswana

Debswana is the joint venture that operates Botswana’s major diamond mines. It is owned in equal parts by the state and the De Beers Group.
De Beers was founded in South Africa in the late 19th century, at the height of the colonial diamond rush, and is today a large multinational corporation controlled by the Anglo American group, with headquarters in the United Kingdom.
For decades it has exerted a decisive influence on the global market, thanks to its ability to coordinate supply, prices and distribution. The Botswanese state, through Debswana, maintains sovereignty over the resources and collects a significant share of the profits through profits, royalties and taxes.

This set-up represented something different from many commodity-rich countries.
Revenues generated from extraction were used to finance schools, hospitals, infrastructure and tax breaks. Not always in a linear manner, and not without contradictions, but with a sufficient level of redistribution to sustain political stability, public investment and a slow growth of the middle class.
It is also thanks to this architecture that Botswana has been able to grow more than its neighbours, despite starting from similar conditions.

The Future

The phase that now opens is a decisive test. American duties reduce the profitability of a sector already under pressure. The diplomatic opening towards Moscow offers an alternative channel but also implies new industrial and financial relations that could redefine the decision-making centres of the industry.
At the same time, the government negotiates with Washington for more favourable conditions.

If Botswana uses this phase to develop local supply chain segments, qualify its labour force, attract investment under transparent rules and strengthen democratic controls, it will continue to move in the orbit of inclusive institutions.

In this scenario, economic diversification will not be a mere slogan but a concrete choice that can reduce structural vulnerability.

If, on the other hand, the response will be through opaque bilateral agreements, concentrated concessions, new relationships of dependence with a few external partners, and a use of revenues increasingly oriented towards the management of domestic consensus, then the diamond crisis risks turning into a slow but steady extractive drift.

The African state today moves along this ridge. On the one hand, the legacy of institutions that, with all its limitations, have tried to turn revenue into development. On the other the pressure of a changing global market, between new technologies, trade regulations and geopolitical competition. The country’s fate will not depend solely on recovering the value of diamonds, nor on whether it chooses to collaborate with Washington or Moscow. It will depend on whether the transition phase strengthens the inclusive dimension of the state instead of eroding it.

It is a game that concerns Botswana and speaks to everyone. Subsoil wealth can be a promise or a trap. The quality of the institutions is what decides which one prevails.