Botswana is emerging as a clear winner in the race to full recovery as it is pulling ahead in the world’s economic recovery and leading the pack in the African region, according to two independent reports.
The first report is by the International Monetary Fund (IMF) which shows that Botswana is among four countries that are expected to register a growth of more than 6 percent. In fact, the report says, Botswana’s growth is expected to reach 9.2 percent which is the highest score in the continent.
The Minister of Finance and Development Planning Peggy Serame, when presenting the budget strategy paper recently said from a contraction of 8.5 percent in 2020, the economy is expected to rebound in 2021 with a growth rate of 9.7 percent for 2021 as a whole.
The IMF predicts that in the Sub Saharan African region Botswana, Seychelles, Burkina Faso, and Côte d’Ivoire will record growth of 6% or more.
Overall, the IMF estimates, in its new global economic outlook report, economic growth of 3.7% for sub-Saharan Africa in 2021 adding that growth will not be evenly distributed across the region.
The report shows that Seychelles will follow with 6.9%, Burkina Faso with 6.7%, and Côte d’Ivoire with 6%. Although this outlook seems to be close to that of the World Bank, which was expecting a 3.3% recovery for the region, some differences remain.
Another report by Africa Risk-Reward Index 2021 shows that Botswana recorded the highest increase in reward score on the index, followed by Zimbabwe, South Africa, Egypt and Namibia. Just like South Africa and Namibia, Botswana’s economic recovery was attributed to stimulus spending and availability of covid-19 vaccines.
“Economies are starting to recover and the virus is no longer an all-consuming issue infringing on every area of the investment landscape,” says the index.
Botswana entered into a loan agreement with the World Bank on worth $250 million as part of the country’s efforts to finance economic recovery programmes.
Serame explained that this is Botswana’s first budget support loan received from the World Bank.
Speaking at the signing ceremony, Serame said the financing will help Botswana to bolster private sector development and foster a strong, green recovery.
This will comprise of reforms to increase renewable energy production by independent power producers, climate change considerations in environmental assessments and the promotion and regulation of rooftop solar energy generation.
World Bank Country Director for Eswatini, Botswana, Lesotho, Namibia and South Africa, Marie Francoise Marie-Nelly, said Botswana has massive potential in the renewable energy sector with regards to local consumption and exports.
“The Covid-19 pandemic has placed a great burden on the country’s economy, its people, and firms. With this operation, the World Bank will support the government’s reforms to ensure social spending reaches the poorest and assists Batswana who are most affected by the Covid-19. This operation will also support reforms to attract private sector investments, contribute to diversification of exports, and increase job opportunities towards a green economy,” said Marie-Nelly.