A booming resource sector might appreciate domestic currency and crowd out manufacturing, labelled Dutch disease (DD). Diamond-producer Botswana, South African Customs Union member, is a rare success story of resource-based development in SSA. We examined diamond trade partnerships from 2006 to 2018 in separate NARDL models to see whether Botswana had the DD. A partial DD was identified: its effects are limited to specific trade partners and transmission channels. A partial DD and the South African Customs Union revenue-sharing formula makes diversification in Botswana strenuous.
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