Botswana is scrambling to figure out how to stop a potential diamond crisis following a report showing how lab-grown diamonds are going to get more popular among consumers.
The report was recently submitted to the Public Accounts Committee (PAC) by the Permanent Secretary in the Ministry of Minerals and Energy, Ellen Richard-Madisa.
Its thrust is that the global diamond market is expected to undergo significant changes in the coming years, with several predictions pointing to shifts in the way diamonds are sourced. Quoting extensively from it, Richard-Madisa, said the diamond industry is likely to face four major trends in 2023 and beyond.
More shopping online
The first prediction, she noted, is that lab-grown diamonds will continue to gain popularity among consumers, particularly among millennians and Gen Z who prioritise sustainability and ethical sourcing.
This trend, she said, is expected to put pressure on the natural diamond market which may struggle to compete with the lower prices and higher ethical standards of lab-grown diamonds. “The rise of digital technology will transform the way diamonds are marketed and sold,” she said. “With more consumers shopping online, diamond retailers are likely to invest in digital platforms and virtual experiences to enhance their customer engagements and sales.”
More transparent and traceable
Richard-Madisa emphasised that the diamond supply chain will become more transparent and traceable. “Consumers are increasingly demanding to know the origin of their diamonds and companies are responding by implementation of blockchain and other technologies to track the entire journey of a diamond from mine to market,” she said.
Richard-Madisa noted that this trend is expected to boost consumer confidence in the diamond industry and ensure that diamonds are sourced ethically and sustainably. “The report predicts that the diamond industry will continue to face challenges related to COVID-19 pandemic, including supply chain disruptions and shifting consumer behavior,” she warned.
Diamonds in a post-pandemic world
“However, the industry is expected to adapt to these challenges by developing new strategies for sourcing, marketing and selling diamonds in a post-pandemic world.” Overall, the report suggests that the diamond market is on the cusp of significant change, driven by shifting consumer preferences and digital innovation.
“As this industry adapts to these trends, it will need to find new ways to stay relevant and competitive in a rapidly evolving market,” Richard-Madisa said. Meanwhile, speaking on a related subject, Richard-Madisa said rough diamonds sales declined in the first quarter of 2023 as compared to 2022 sales. “There has been a slow demand for rough diamonds worldwide,” she said. Botswana’s economy is largely dependent on the diamond sector, which accounts for more than half of the country’s GDP.
