Botswana’s economy rebounded in Q1 2026, powered by stronger mining output, soaring electricity generation and a revival in diamond trade
BONGANI MALUNGA
Botswana’s economy returned to positive territory in the first quarter of 2026, with real Gross Domestic Product (GDP) growing by 3.5 percent after contracting by 0.3 percent during the same period last year, signalling a gradual recovery driven by stronger mining activity, surging electricity production and renewed momentum in diamond trading.
“The nominal GDP for the first quarter of 2026 was P73.1 billion, compared to P67.5 billion recorded in the previous comparative quarter (2025). This represents a quarterly increase of 8.2 percent in nominal terms,” said Statistician General, Dr Khaufelo Lekobane in a report released by Statistics Botswana.
The rebound was powered largely by exceptional performances in the Water and Electricity sector, which expanded by 87.4 percent, and Diamond Traders, whose real value added surged by 60.5 percent following a difficult 2025.
BACKBONE OF BOTSWANA’S ECONOMY
Mining and Quarrying, the backbone of Botswana’s economy, also posted encouraging results, recording growth of 3.4 percent. Diamond production rose by 4.8 percent, supported by higher processing volumes at Orapa and Jwaneng mines and improved recovery grades. Soda ash production increased sharply as Botash operated at full capacity.
Public Administration and Defence emerged as the single largest contributor to GDP, accounting for 16.9 percent of total output, followed by Mining and Quarrying at 14.4 percent, Wholesale and Retail Trade at 12.3 percent and Construction at 11.4 percent.
The non-mining economy also demonstrated resilience, growing by 2.7 percent compared to 2.3 percent during the corresponding quarter in 2025. Manufacturing expanded by 3.4 percent, buoyed by a 39.3 percent increase in diamond cutting and polishing activities, alongside gains in bakery production and wood and paper manufacturing.
GRADUAL RECOVERY
Tourism-related sectors continued their gradual recovery, with Accommodation and Food Services rising by 3.3 percent, while air transport growth of 12.4 percent helped lift the broader Transport and Storage industry.
However, several warning signs remain. Total final consumption expenditure declined by 1.4 percent, reflecting weaker household spending, while Gross Fixed Capital Formation contracted by 10.4 percent, indicating subdued investment activity. Exports of goods and services also fell sharply by 36.5 percent.
Agriculture remained under pressure, shrinking by 3.4 percent as Foot and Mouth Disease restrictions disrupted livestock movements and curtailed beef exports to European markets. Cattle sales to the Botswana Meat Commission plunged by more than half during the quarter.
Despite these challenges, the latest figures suggest Botswana’s economy is beginning to stabilise, with improvements in mining, energy generation and domestic industries helping offset weaknesses in consumption, investment and agriculture.