This is the script for my video posted on September 4, 2026. Watch it on TikTok.
Botswana’s entire economy rests on a single commodity. Diamonds long provided about a third of the government's revenue, and they're still around 80% of its exports, but the collapse of demand for natural diamonds globally has triggered Botswana's worst financial crisis in decades, and perhaps a geopolitical overhaul. So why is Botswana so reliant on the diamond trade, and how is it trying to move on?
Before the colonial era, modern Botswana was a collection of independent Tswana chiefdoms, alongside San, Kalanga, and other groups who were often subordinated within them. The Tswana were governed through a public assembly where the chief had to consult commoners, and this open political environment in turn placed constraints on social elites that persist to this day.
But in 1885 as colonial powers moved into the region, Britain declared the Bechuanaland Protectorate to block German expansion from the west and Boer settlement from the Transvaal, and to secure the road north into the interior of the continent.
A few years later, Cecil Rhodes's British South Africa Company, which had already taken over the land that became Rhodesia, pushed to absorb Bechuanaland too.
In 1895, three Tswana chiefs actually traveled to London and visited British towns to make their case to Colonial Secretary Joseph Chamberlain that the protectorate stay under the Crown rather than a company, which were known to be more oppressive and exploitative. They won public sympathy, and Rhodes's failed raid into the Transvaal months later killed his company's bid. The region avoided the same fate that shaped Rhodesia and South Africa.
But the British viewed the territory as a buffer region with no real resources, and they barely invested into it. They didn’t even bother ruling it from inside, instead administering it from South Africa.
But in 1948, Seretse Khama, the heir to the Bangwato chieftaincy and a law student in London, married a white Englishwoman. South Africa’s new apartheid government pressured Britain to exile the couple during the 1950s.
Khama then renounced his chieftaincy, founded the Bechuanaland Democratic Party, or BDP, and became Botswana’s first president when the country gained independence in 1966 amid Britain’s larger decolonization movement.
About a year later, geologists from the South African mining giant De Beers discovered an enormous kimberlite structure full of diamonds at Orapa. The 1967 Mines and Minerals Act had the chiefs surrender tribal mineral rights and vest them in the state, which allowed the entire country to benefit rather than a single chieftaincy. De Beers naturally expanded in the country and formed a joint venture with the government, later named Debswana, in which the state's stake climbed from 15% to a full 50% by the mid-1970s.
Botswana was economically dependent on Rhodesia and South Africa, but they still opposed apartheid and racial discrimination more broadly. They provided refuge to anti-apartheid exiles from the African National Congress, or ANC, though they refused to let the ANC set up armed bases.
Botswana had no military for years after independence, largely due to poverty and deliberate non-alignment, but Rhodesian forces kept crossing the border during the Rhodesian Bush War, and in 1977 Botswana created a defense force of its own, though it couldn't stop the raids. When South African forces hit Gaborone in 1985 and killed twelve people, most of them not even ANC members, the new army didn't fire a shot. But that restraint is often credited with keeping Botswana out of a wider war.
For decades, billions of dollars worth of diamonds came out of Botswana via its joint venture with De Beers. But the money didn't build the country’s institutions. Botswana already had a capable bureaucracy and disciplined leadership, and that's what let it manage the windfall instead of squandering it, saving surpluses in a sovereign wealth fund called the Pula Fund.
But starting in 2023, the natural diamond market crashed as cheap lab-grown stones took over engagement rings in the US, Chinese demand collapsed, and post-pandemic oversupply piled up.
The country has tried to diversify its economy, but nothing has stuck. Tourism contributes only about 5% of GDP directly and has grown slowly for decades, and while copper output has grown fast enough to soften the blow, coal, soda ash, and agriculture remain small.
In August 2025, the government declared a national public health emergency after government hospitals ran out of medicine, thanks to the diamond downturn, supply chain failures, and cuts to US aid to Botswana.
With diamond revenue falling, receipts from the Southern African Customs Union, or SACU, have become the largest source of government revenue, at about a third. They’ve overtaken mineral revenue, but the problem with this is that SACU payments are volatile, lag by up to two years, and depend heavily on trade flows with South Africa, deepening Botswana’s reliance on larger regional powers.
In general, Botswana relies heavily on South Africa, for ports and trade routes because it’s landlocked, and it still buys some power from South Africa’s state utility Eskom even though it produces most electricity for itself.
Since 2000, it also had duty-free access to the US market, which was central to trade. But in April 2025 the current US administration announced a 37% tariff on Botswana. That was negotiated down to 15% by August, but even that was harmful, because about 90% of diamonds by volume are cut and polished in India, which faced US tariffs as high as 50%. When the Supreme Court struck those emergency tariffs down in February 2026, the US replaced them with other levies within days, and Botswana's duty-free access wasn't restored until the summer. The volatility made an already bad situation much worse.
One way Botswana punches above its weight though is through its elephants. Botswana has the world’s largest elephant population, about 132000 as of 2022. It’s a party to the Convention on International Trade in Endangered Species of Wild Fauna and Flora, or CITES, and it often serves as a leader in discussions about sustainable use of wildlife.
Counterintuitively, Botswana actually doesn't oppose the sale of elephant ivory, arguing instead that the revenue should be reinvested into rural communities and anti-poaching operations. European proposals to ban the import of hunting trophies provoked Botswana to threaten to send 20000 elephants to Germany and 10000 to London's Hyde Park, creating a lot of attention and diplomatic leverage.
Meanwhile, in 2024, the Botswana Democratic Party left power after 58 years of rule. The Umbrella for Democratic Change, or UDC, led by a human rights lawyer, won 36 of 61 directly elected seats in parliament, and the BDP fell to just four seats.
Despite a nominal GDP per capita of 7000 USD, the country had been struggling with wealth disparity even before the economic downturn. But today unemployment is nearly 28%, and among people aged 15 to 35 it’s closer to 45%.
Botswana also has one of the world’s highest rates of HIV, at around 16% among people aged 15-49. In May 2025 it became the first high-burden country to earn World Health Organization “gold tier” certification for eliminating mother-to-child transmission, but there are concerns that cuts to US funding could put progress in jeopardy.
The country is in a period of flux. Botswana's most lucrative resource by far has lost much of its value, and without it the country will need to find another way to make money, or it will risk losing everything it's built since it gained independence.
Keep reading
- How does South Africa’s history feed into its geopolitical dynamics?
- Why can’t Ghana afford its own democracy?
- How does Malawi survive?
I’m writing a book called Groundwork about the buried history beneath geopolitics. Join the waitlist to hear when it has a publisher, a cover, and a release date.