The agency cited the government’s challenges in adjusting to a structural downturn in the diamond industry and increasing government debt.<\/p>\n
<\/p>\n
“The economy remains heavily reliant on capital-intensive diamond mining; diversification efforts lag due to reform delays, while exposure to climate shocks persists,” Moody’s said in a statement.<\/p>\n
<\/p>\n
Long viewed as an African economic success story, Botswana is in a slump due to a prolonged downturn in the global diamond market, its key export, with demand hurt by global economic uncertainty and the rising popularity of lab-grown stones.<\/p>\n
<\/p>\n
The world’s leading producer of diamonds by value, whose diamond exports continue to drive foreign exchange, has seen sector weakness widen its current account deficit and push reserves to a historic low, according to Moody’s.<\/p>\n
<\/p>\n
It expects Botswana’s economy to likely decline by an additional 6% in 2025 as it remains exposed to global demand shocks and technological disruption from lab-grown alternatives and changes in consumer preferences.<\/p>\n
<\/p>\n
Last month, peer agency S&P cut Botswana’s rating to ‘BBB’ as it expects weak global diamond demand and prices to keep the Southern African country’s external and fiscal flow positions weak.<\/p>\n
<\/p>\n
The agency said the global diamond downturn is unlikely to reverse, while maintaining the country’s outlook at ‘negative’.<\/p>\n
<\/p>\n
–Reuters–<\/p>\n","protected":false},"featured_media":13385,"template":"default||default","meta":{"_acf_changed":false},"news-type":[44],"class_list":["post-13384","news","type-news","status-publish","has-post-thumbnail","hentry","news-type-finance","entry"],"acf":{"short_description":"Global credit ratings agency Moody's downgraded Botswana's rating to 'Baa1' from 'A3' on Friday. ||Global credit ratings agency Moody's downgraded Botswana's rating to 'Baa1' from 'A3' on Friday. ","published_date":null,"news_description":"Global credit ratings agency Moody's downgraded Botswana's rating to 'Baa1' from 'A3' on Friday. ||Global credit ratings agency Moody's downgraded Botswana's rating to 'Baa1' from 'A3' on Friday. ","form_embed":"","author":"","image_caption":""},"_links":{"self":[{"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/news\/13384","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/news"}],"about":[{"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/types\/news"}],"version-history":[{"count":1,"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/news\/13384\/revisions"}],"predecessor-version":[{"id":18530,"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/news\/13384\/revisions\/18530"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/media\/13385"}],"wp:attachment":[{"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/media?parent=13384"}],"wp:term":[{"taxonomy":"news-type","embeddable":true,"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/news-type?post=13384"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}