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Botswana's Troubled Economy


Botswana, the world's biggest producer of diamonds, suffered in sales amid the global recession.


The country's economy declined 20.3 percent in the first quarter of 2009, compared with the same time in 2008.The mining industry shrank an annual 68.6 percent in the first quarter of 2009 after shrinking 10.1 percent in the fourth quarter of 2008. The country's exports dropped 67 percent in the first quarter alone.

 

The joint venture between Da Beers and Botswana's government, Debswna, agreed on February 23 to "keep all four of its mines in the country shut until April 14 to cut costs after diamond sales collapsed," according to Bloomberg. This has affected the Botswana economy, since mines make up 70 percent of the country's exports.

 

In an attempt to stabilize the troubled economy, Botswana's government accepted a $1.5 billion loan from the African Development bank in June 2009.


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