On September 29th, a day before the country’s Independence Day, Statistics Botswana (SB) will shed light on the country’s economic performance by releasing a set of three economic key figures.
SB, which is mandated to gather, analyse and publish economic data amongst other things is expected to release the Indices of the Physical Volume of Mining production, International Merchandise Trade Statistics (IMTS) (July) as well as the Gross Domestic Product GDP) for the second quarter of 2020.
The Indices of the Physical Volume of Mining shed light on mining activities in the country while the IMTS highlights key changes in the balance of trade.
Captains of various industries in Botswana are likely to develop keen interest in the country’s GDP figures for the second quarter.
The latest GDP figures will be published at a time when the domestic economy is bracing for a crunch, with several forecasts pointing to a recession in 2020. The forecasted recession has been associated with weak diamonds demand and subsequent production cuts in the mining sector as a whole which would likely be reflected by the IMTs and the Indices of the Physical Volume of Mining production.
Since the Covid-19 outbreak in Botswana, international credit rating agencies, development banks as well as the finance ministry and its agencies have made several revisions to Botswana’s GDP lowering their expectations as forecasts become gloomy. In April 2020, when Covid 19 arrived in Botswana shores, Dr Thapelo Matsheka – the country’s Finance and Economic Development Ministry projected that the GDP will contract by 13.1 percent, down from the February projected growth of 4.4 percent.
First National Bank Botswana – one of the leading banks in the country recently said that it anticipates that the disruptions to business and consumer activity associated with COVID-19 pandemic in Botswana will result in an economic contraction of 10.5 percent in 2020.
The latest projection was made international credit rating agency – S&P Global Ratings which on September 18, 2020 released a statement indicating that Botswana’s economic contraction will be close to 10 percent in 2020. The negative growth, S&P Global said is a reflection of the past Covid 19 sponsored lockdowns and potential future intermittent lockdowns in Gaborone for the remainder of 2020.
While waiting for the second quarter GDP figures, industry captains are possibly looking at the first quarter numbers which shows that economic activity amounted to P50.7 billion in the first three months of the year, putting growth at 2.5 percent. In real GDP terms, the economy grew by 2.6 percent to P25 billion. The economic growth rate was much lower than 2019’s first quarter GDP rate of 4.2 percent.