GABORONE, Nov. 7 (Xinhua) -- Botswana's economy is technically in recession, as the southern African country's diamond sector is faltering on the global market, an official said on Thursday.
Innocent Molalapata, director of the research and financial stability department at the Bank of Botswana, the country's central bank, told reporters at a media briefing held by the Monetary Policy Committee in Francistown, Botswana's second-largest city.
"We are basically in a technical recession. When we have two consecutive quarters of contraction, that is classified as technical recession," said Molalapata.
Botswana's economy contracted by 0.5 percent year-on-year in the second quarter of this year, following a 5.3 percent decline recorded in the previous quarter, according to the latest figures from Statistics Botswana.
According to the statistical agency, the contraction in economic activity was driven by lower external demand for mining sector output, particularly diamonds. This has led to reduced export earnings, which is constraining government spending and impacting overall economic activity.
Central Bank Governor Cornelius Dekop confirmed that Botswana's real gross domestic product contracted by 0.5 percent year-on-year in the second quarter, in contrast to the 3.4 percent growth recorded during the same period in 2023.
