BOTSWANA
BY PATRICIA THOMAS
Africa’s Diamond In
The Rough
A country full of economic potential
B
ots wa na is a count r y t hat ca nnot be
overlooked by property investors, businesses
and tourists alike. This is a country full of
economic potential.
Since Botswana gained independence from the UK
in 1966, it has since transformed itself into one of the
fastest-growing emerging economies, with one of
the fastest growth rates in per capita income, in the
world. Botswana is estimated as having the fourth
highest gross national income and purchasing power
equivalence in Africa, giving it a standard of living
around that of Mexico and Turkey.
Economy
Botswana has maintained one of the world’s highest
economic growth rates. Earmarked as having one of
the most robust economies on the continent, Botswana
is monetarily driven by diamond mining and a thriving
tourist market. Game parks comprise of nearly onefifth of the country, making tourism one of the major
economic influences in Botswana.
According to the International Monetary Fund,
economic growth in Botswana averaged over 9% per
year from 1966 to 1999. The government managed to
maintain a sound financial policy, and a negligible level
of foreign debt. It earned the highest sovereign credit
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Offshore Handbook 2014
rating in Africa and has stockpiled foreign exchange
reserves amounting to almost two and a half years of
current imports. Additionally, Botswana also boasts
a high level of economic freedom compared to that of
other African countries.
Two major investment services rank Botswana as
the best credit risk in Africa. Diamond mining has
fuelled much of the expansion and currently accounts
for more than one-third of GDP, 70%-80% of
export earnings, and about half of the government’s
revenues. This has led to several international mining
corporations establishing regional headquarters in
Botswana in search of commodities such as diamonds,
gold, uranium, copper and even oil. Tourism, financial
services, subsistence farming and cattle-raising are
other key sectors in Botswana.
Growing market
With the current positive economic growth on the
African continent and particularly countries such as
Botswana, it is predicted that within the next seven
years more than half the households on the continent
will have enough income to purchase way more than
just the essentials and will be able to splurge on luxury
items. This, along with the fact that a large portion of
the African population is below the age of 20, means
that within the next thirty years the continent will
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