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Weak Diamond Sales May Fuel Botswana Budget Deficit
Aug 18, 2015 2:26 AM
By Rapaport News
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RAPAPORT... Botswana’s budget surplus could turn into a deficit as revenue from rough diamond sales fell during the first six months, according to news website Mmegionline.
Back in February, Finance Minister Kenneth Matambo had projected a $120 million (P1.23 billion) surplus. A weaker market for rough diamonds could therefore have a detrimental impact on the government’s revenue and spending.
For every pula (9 cents) of diamonds Debswana sells to De Beers and the Okavango Diamond Company, the government earns 80 thebe in revenue, according to the report.
“It is very difficult to quantify the potential impact but I would say that the decline in government revenues would be proportionate to the decline in sales,” said Keith Jefferis, economist and managing director at Econsult Botswana Ltd., told Mmegionline.
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Tags:
Botswana, Rapaport News, Rough markets
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