Fashion
Lab-grown diamonds robbing southern Africa of riches
By
AFP
Published
September 14, 2025
Botswana and southern African peers that built much of their prosperity on diamonds are scrambling for alternatives as cheaper, lab-grown stones threaten their economies.
Diamond-dependent Botswana is leading the way and launched a sovereign wealth fund this week to lay the “foundation for a more resilient, sustainable and diversified future beyond diamonds”.
It is exploring other avenues too, like boosting luxury wildlife tourism, launching into the medicinal cannabis market and exploiting its abundant sunshine for solar power.
President Duma Boko has even mooted taking a majority stake in industry giant De Beers and selling Botswana’s diamonds independently.
“Countries such as Angola, Namibia and South Africa are all exposed but not to the same degree as Botswana,” economist Brendon Verster at the Oxford Economics Africa think tank told AFP.
The stones are the country’s main source of income and account for about 30 percent of its gross domestic product (GDP) and 80 percent of its exports, according to the International Monetary Fund.
But, as consumers turn to cheaper diamonds created in China and India, the average price of a one-carat natural diamond is falling.
The price dropped from a peak of $6,819 in May 2022 to $4,997 by December 2024, according to the World Diamond Council.
Botswana, which is 70 percent desert, was lifted from poverty by the discovery of diamonds in the 1960s. It is already feeling the effects of the lab-grown competition.
– ‘Risks of economic collapse’ –
As its foreign reserves deplete, the government has turned to debt to fill the public coffers.
Government funds ran so low that the health system teetered on the verge of collapse in August, leading Boko to declare a state of emergency.
“If left unaddressed, there is a real risk of the situation becoming not just an economic challenge but a social time bomb,” he said in July.
Highlighting the fears, global ratings agency S&P on Friday dropped its long-term ratings on Botswana one notch to “BBB” and declared a negative outlook, citing the rapid expansion of the lab-diamond market.
Synthetic stones had captured “approximately 20 percent of the global market by value and up to 50 percent by volume in the US engagement ring segment in 2025,” it said in a statement.
Diversification is “essentially now or never”, Verster said.
“We don’t really see anything that would cause a monumental shift back in favour of natural diamonds to curb the rising popularity of synthetic diamonds.”
Also suffering is tiny Lesotho, where diamonds contribute up to 10 percent of its $2 billion GDP and the larger, vital textile market has been hit by US tariffs.
This month its biggest diamond mine, Letseng, said it would lay off a fifth of its workforce, citing “sustained pricing pressure” and “softer demand in key markets”.
The mine closures “could heighten risks of economic collapse”, independent economic analyst Thabo Qhesi told AFP, stressing an urgent need to explore other options, such as rare-earth resources.
In a bid to keep the sparkle alive, Angola, Botswana, Namibia, South Africa and the Democratic Republic of Congo pledged in June to allocate one percent of their annual diamond revenues to marketing natural diamonds.
The campaign would need to reframe their value as a coveted “luxury product”, former Bank of Botswana deputy governor Keith Jefferis told AFP.
“We see a significant opportunity to engage consumers in the story of responsibly sourced diamonds from Botswana,” De Beers, also taking part, told AFP.
The South Africa-British firm is meanwhile exploring the potential of synthetic diamonds in high-tech fields like quantum networks and semiconductors, as prices fall below $100 per carat.
For Botswanan ministry of minerals official Jacob Thamage, natural and lab-made diamonds “offer different value propositions to different consumers and therefore can and will coexist”.
In an upscale Johannesburg mall, behind fortified steel gates, a natural yellow diamond priced at over $50,000 stood as a symbol of exclusivity.
Just steps away, a lab-grown diamond valued at $115 was unguarded.
“We each have our target,” one jeweller said. “So long as everyone is happy.”
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The data showed that the decline was driven mainly by weaker domestic exports, with goods produced in the Netherlands down 8 per cent YoY. In contrast, re-exports to the US rose 3.9 per cent during the period. Exports to the US have fallen every month on a YoY basis since July, CBS said in a press release.
Trade flows were influenced by uncertainty around US import tariffs. In the first half of 2025, trade between the two countries continued to grow, possibly as companies advanced shipments ahead of announced tariff measures.
Goods exports from the Netherlands to the United States fell 4.7 per cent YoY to €27.5 billion (~$33 billion) in the first ten months of 2025, driven by an 8 per cent drop in domestic exports, according to CBS.
Re-exports rose 3.9 per cent, while tariff uncertainty weighed on trade.
Imports from the US increased 1.9 per cent to €48.1 billion (~$57.7 billion).
Meanwhile, imports from the United States rose 1.9 per cent YoY to €48.1 billion (~$57.7 billion) in the first ten months of 2025.
Fibre2Fashion News Desk (SG)
The Philippines’ economic growth for the third quarter (Q3) of 2025 has been revised slightly lower, with gross domestic product (GDP) expanding 3.9 per cent year on year (YoY), down from the preliminary estimate of 4 per cent.
Gross national income growth for the quarter was also revised to 5.4 per cent from 5.6 per cent, while net primary income from the rest of the world was adjusted to 16.2 per cent from 16.9 per cent.
The Philippine Statistics Authority has revised down the country’s third-quarter 2025 GDP growth to 3.9 per cent from an earlier estimate of 4 per cent.
Gross national income growth was also lowered to 5.4 per cent, while net primary income from abroad eased to 16.2 per cent.
The PSA said the adjustments reflect its standard, internationally aligned revision policy.
The Philippine Statistics Authority said the revisions were made in line with its approved revision policy, which follows international standards for national accounts updates.
Fibre2Fashion News Desk (HU)
Operating margin improved sharply to 10.8 per cent from 4.4 per cent in FY24, while adjusted EBIT margin increased to 11.4 per cent from 10.7 per cent, marking the third consecutive year of margin expansion. The net income from continuing operations more than doubled to $502 million from $210 million, with adjusted net income rising to $537 million.
Levi Strauss & Co has delivered a strong FY25, with net revenues rising 4 per cent to $6.3 billion and organic growth of 7 per cent, alongside sharp margin expansion and higher profitability.
Q4 saw 5 per cent organic growth, led by Europe, Asia and DTC, which accounted for nearly half of revenues.
The company expects mid-single digit growth and further margin gains in FY26.
Diluted EPS from continuing operations increased to $1.26 from $0.52 in the previous year, while adjusted diluted EPS rose to $1.34 from $1.24. The company generated $530 million in operating cash flow and $308 million in adjusted free cash flow. The company returned $363 million to shareholders during the fiscal, up 26 per cent YoY, LS&Co said in a press release.
In the fourth quarter (Q4) ended November 30, 2025, the company reported net revenues of $1.8 billion, up 1 per cent on a reported basis and 5 per cent organically compared with Q4 FY24. Growth was broad-based, supported by strong momentum in Europe, Asia and Beyond Yoga, alongside high-single digit comparable growth in direct-to-consumer (DTC).
Europe recorded reported revenue growth of 8 per cent and organic growth of 10 per cent, while Asia delivered growth of 2 per cent reported and 4 per cent organically. In the Americas, revenues declined 4 per cent reported but increased 2 per cent organically, with the US business flat on an organic basis. Beyond Yoga continued to outperform, posting reported growth of 37 per cent and organic growth of 45 per cent.
DTC revenues increased 8 per cent on a reported basis and 10 per cent organically, driven by strength across all regions. E-commerce revenues rose 19 per cent reported and 22 per cent organically, with DTC accounting for 49 per cent of total quarterly revenues. Wholesale revenues declined 5 per cent reported and were flat organically.
Operating margin in the quarter was stable at 11.9 per cent, while adjusted EBIT margin declined to 12.1 per cent from 13.9 per cent a year earlier due to tariff-related pressure on gross margins and higher adjusted SG&A expenses. Gross margin stood at 60.8 per cent versus 61.8 per cent in Q4 FY24. Net income from continuing operations was $160 million, with diluted EPS of $0.4 and adjusted diluted EPS of $0.41.
“Over the past few years, we’ve taken bold steps towards becoming a DTC-first, head-to-toe denim lifestyle brand,” said Michelle Gass, president and CEO of Levi Strauss & Co. “We are well on our way toward realising our strategic ambitions. We have narrowed our focus, improved operational execution and built greater agility across the organisation. As a result, we’ve elevated the Levi’s brand and delivered faster growth and higher profitability as reflected by our Q4 and full year 2025 results. While we still have important work ahead, the company is at an inflection point—emerging as a stronger, more resilient global business ready to define the next chapter of LS&Co.”
“We are sustaining our momentum, delivering 5 per cent organic growth in the fourth quarter on top of 8 per cent growth in the prior year. Our success in denim lifestyle has enabled us to expand our addressable market, positioning us for mid-single digit growth in 2026 and beyond,” said Harmit Singh, chief financial and growth officer of Levi Strauss & Co. “Our disciplined approach to converting growth into profitability has improved adjusted EBIT margin again in 2025 for the third year in a row, and we are on track to expand margins further as we strive toward 15 per cent. Our confidence in this trajectory is reflected in a new $200 million ASR program.”
Looking ahead, the company expects mid-single digit revenue growth in fiscal 2026 alongside further adjusted EBIT margin expansion, supported by continued DTC momentum, disciplined cost management and ongoing brand strength, added the release.
Fibre2Fashion News Desk (SG)
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