Sales of rough diamonds at Debswana Diamond Company fell by 49.2% in the first half of this year, according to data from Botswana's central bank, totalling $1.29 billion, down from $2.54 billion in the same period last year.

In local currency, sales of rough diamonds fell by 47.3% to 17.555 billion Pula compared to the previous year.

This decline in sales is a significant setback for the South African nation, which relies on rough diamond sales for 30%-40% of its revenue, 75% of its foreign exchange earnings, and a third of its national output, Business Insider Africa reports.

The central bank data attributed the sharp decline primarily to the downturn in the global diamond market. 

In response to weak consumer demand, Anglo-American reduced its diamond production by 19% in the first six months of the year.

Additionally, Reuters reported that the company also revised its output guidance for De Beers, lowering it to 23-26 million carats from the previous estimate of 26-29 million carats.

Debswana Diamond Company is a joint venture between the government of Botswana and Anglo American Plc’s De Beers. 

De Beers sells 75% of Debswana’s output to itself, with the remaining balance acquired by the state-owned Okavango Diamond Company (ODC).

In spite of the current economic challenges, Botswana and De Beers entered into a 10-year diamond sales agreement back in June.

Under this deal, the share of Debswana’s output sold by the state-owned Okavango Diamond Company (ODC) will gradually increase from 25% to 30%, then to 40% in five years, and eventually to 50% by the end of the new contract.

The key points in the agreement indicate that this strategic move is intended to enhance Botswana's revenue from its diamond resources.