Botswana Closes in on Duty-Free Diamond Trade Agreement with U.S. Amid Tariff Pressures
Botswana is close to securing an agreement with the United States that would allow its diamonds to be imported duty-free — a potential economic lifeline for the landlocked nation as it faces mounting pressure from U.S. tariffs that have strained its diamond-dependent economy.
Speaking to the BBC about the ongoing trade discussions, President Duma Boko stated, “The negotiations are in an advanced stage. We are on the verge of reaching an agreement.”
Tariff Pressure on Botswana’s Diamond Industry
The U.S. currently imposes a 15% tariff on Botswana diamonds, which applies only to stones cut and polished in the country and imported unset.
Diamonds processed abroad, particularly in India, face a 50% import tax, while only stones cut in Belgium and Canada enter the U.S. duty-free.
These tariffs have heavily impacted Botswana’s diamond sector, a cornerstone of the national economy. In 2023, exports to the U.S. generated around $500 million, supporting jobs, government revenue, and economic stability. However, the sector has recently suffered a 50% decline in diamond sales due to falling global demand.
In a major development, amid stalled negotiations, the United States imposed a 37% tariff on Botswana’s imports starting August 1. This duty combines a 10% baseline tariff introduced in April with an additional 27% under new reciprocal measures.
At the time, President Boko warned that such measures threaten not only Botswana’s diamond market but also broader economic growth across Africa. “These punitive measures threaten the sustainability of Botswana’s diamond industry and present a serious obstacle to broader economic growth across Africa,” he said.
Botswana’s Response and Diplomatic Efforts
Botswana has taken a proactive approach, initiating negotiations with Washington. During his visit to the U.S., President Boko met with Secretary of State Marco Rubio, stating: “We have asked for zero tariffs between Botswana and the United States.
That is what we’ve asked for, and we’ve stated it plainly. We will continue to articulate and defend this position to the United States.”
He added, “We are working around the clock, and if Donald Trump calls us on the matter, I will not hesitate to respond.”
According to Boko, American officials argue that while Botswana enjoys access to the U.S. market, U.S. goods and services face barriers in Botswana, creating a trade imbalance that justifies tariffs. “Because of this trade imbalance, they argue that we must be subjected to tariffs. It’s a reality we must acknowledge and engage on with the Americans,” he said.
Proposal for Strategic Bilateral Engagement
In September, Botswana’s Vice President Ndaba Gaolathe and Trade Minister Tiroeane Ntsima submitted a proposal titled “Botswana Strategic Bilateral Engagement on U.S. Reciprocal Tariffs” to U.S. officials.
The proposal offered priority access to key mineral reserves while inviting U.S. investment in energy, technology, infrastructure, and health sectors.
“The government would ease entry through the Botswana One Stop Service Center, streamlining permits and approvals. Botswana has also pledged to reduce non-tariff barriers and accept certain U.S. product standards to deepen trade relations,” the document stated.
Protecting the Diamond Industry and Africa’s Role
Botswana, the world’s second-largest diamond producer after Russia, has made its intentions clear to the United States and is now awaiting Washington’s response. The deal would protect Botswana’s diamond industry and strengthen Africa’s role in mineral value addition.
