The Eurovision 2010 song contest that took place last Saturday evening was pretty joyful, but reflects only a momentarily escape from the financial crisis plaguing Europe. Emerging economies such as China, Brazil and India seem to have escaped the global financial crisis and continued their growth, but for the ones who are dependant mostly on export of a unique luxurious natural resource, like diamonds and gems, thing might look different.

Botswana, however, remains guarded, as concern mounts that the European debt crisis may undermine the diamond trade – its key export.

Botswana has noted a "slow recovery" and its economy is expected to expand 4.5% in 2010 and 5% in 2011, Gaborone's Deputy Finance Minister Charles Tibone said.

"We are concerned,” said Tibone. “If the Greek crisis persists, then that will affect consumption of our products. What happens to the UK and Europe could impact on diamond sales. Trade between ourselves and Europe is important.”

Botswana is the world’s biggest diamond producer, earning the government about half of its state revenue. It's economy contracted by 6% in 2009, following a slump in diamond sales, which forced mines to shut down for several months.

Botswana's diamond output is expected to rebound to 22 million carats in 2010, from 18 million carats in 2009, as demand from the US – the country's biggest consumer of the diamonds, improves.

The southern African nation said last week it borrowed $133 million from the World Bank to partly finance energy ventures.

Perhaps the wide tourism industry, which attracts a lot of luxury goods consumers, will have a solid effect or at least stabilize the demand of diamonds in Europe.

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