Botswana’s ambitious diamond beneficiation strategy, aimed at transforming the nation’s economy by processing diamonds locally, is facing significant hurdles due to a small, unproductive, and unskilled labour force.
With government revenues declining, the push for downstream processing to foster economic diversification and job creation is at risk, industry leaders warned at the recent India-Botswana Business Conclave, organised by the Botswana Investment and Trade Centre (BITC), the Indian High Commission, and Business Botswana.
The country’s economy has historically relied on diamond mining, which accounts for 85 percent of exports and two-thirds of the government revenue and has propelled the country from one of the world’s poorest to middle-income status. Government adopted a diamond beneficiation policy in 2008, targeting the local cutting and polishing of rough diamonds to create jobs, develop skills, and ensure economic sustainability post-mining.
The beneficiation strategy seeks to retain more value within the country by processing diamonds locally, fostering private sector growth, and creating downstream competencies that remain viable after diamond reserves are depleted. By 2011, the industry employed around 3,250 workers across 16 cutting and polishing factories, with an input-output simulation suggesting that $550 million in annual rough diamond sales could generate over 6,000 indirect jobs in sectors like banking, manufacturing, and logistics.
At the conclave, Siddarth Gothi, President of the Botswana Diamond Manufacturers Association (BDMA), highlighted the critical shortage of skilled labour as a major barrier.
“While infrastructure can always be imported and raw materials, which are diamonds, are available locally, the lack of skilled manpower is holding back the country from fully realising its mineral beneficiation potential,” Gothi stated.
He noted that despite a boom in sightholders (companies’ allocated rough diamonds) in 2023, which doubled the number of diamond cutting and polishing companies, the workforce size has remained stagnant.
“The industry doubled, but the workforce remained the same,” he lamented.
Botswana’s workforce faces multiple challenges: a small labour pool, low productivity, limited skills, a short working week, and strict labour regulations. Gothi pointed out that investors seeking ready-made skills may find Botswana unsuitable. Compared to diamond processing power hubs like India, which has a large pool of skilled manpower in the cutting and polishing sectors, the country’s diamond beneficiation efforts are significantly constrained by its small, unproductive, and unskilled workforce
“For Botswana to achieve beneficiation success, intensive hours have to be adopted in the sector, including a 6-day working week, skills development, and improving productivity levels,” he urged.
Training a worker to become a qualified diamond cutter and polisher is a lengthy and costly process. At KGK Diamonds, where Gothi is a Business Development Manager, the company’s in-house training school, which was the accredited diamond training academy by the Botswana Qualifications Authority (BQA), the process takes up to one year for basic proficiency —six months in a formal classroom setting and six months of on-the-job training. However, Gothi explained that achieving the full proficiency required by factories can take three to five years.
“To take a worker from cutting and polishing one diamond per month to one diamond per day takes about three to five years. That is a lot of effort and money invested by companies in skills development,” he said.
This investment is further complicated by high labour mobility. Once trained, skilled workers often move to competitors offering higher wages, leaving companies like KGK Diamonds to bear the training costs for the industry.
“We could have gone the route of getting ready-made workers from other companies and paid them an extra P200 on top. But in 2019, we decided to set up our academy to train our workers in-house,” Gothi explained. He revealed that KGK Diamonds at some point lost 100 skilled workers to competitors in a single year, forcing the company to train 200 more to compensate.
Gothi sought support from the government’s diamond hub in 2019 to subsidise training fees, as running the academy independently meant producing skilled workers for competitors.
“Till today, there has been no feedback or support,” he said. Meanwhile, the government has issued 20 to 30 new licenses to factories in 2023, many of which, he said, are struggling to find skilled labour locally and are on the verge of closure.
Mmantlha Sankoloba, CEO of the Botswana Exporters and Manufacturers Association (BEMA), who moderated the conclave’s panel discussion, suggested that the government’s efforts to revamp Technical and Vocational Education and Training (TVET) could address the skills shortage. TVET programs aim to equip the workforce with industry-relevant skills, but Gothi emphasised the need for direct government collaboration with factories.
“The government should invest and collaborate with factories in training workers,” he said.
Gilbert Mangole, Ambassador of Botswana to India, suggested that the country emulate Surat, India, a global hub for diamond cutting and polishing that processes 90 percent of the world’s rough diamonds and employs over 800,000 polishers. Surat’s transformation from a small trading centre to the “diamond capital of the world” was driven by investments in infrastructure, technology, and training, alongside a robust network of traders and associations, which significantly boosted productivity and competitiveness.
“Manufacturers could propose a model similar to Surat to increase labour productivity locally,” Mangole suggested. Adopting Surat’s productivity levels, he said, could help Botswana overcome its workforce challenges, but this would require significant investment in training, technology, and policy reforms to extend working hours and relax labour regulations.
Despite the challenges, Gothi remains optimistic about Botswana’s diamond beneficiation potential.
“There is still potential in the diamond beneficiation sector—more jobs to be created, more skills transfer, more value addition that can be done,” he said.
