A new report compiled by researchers at University of Johannesburg-affiliated research and capacity development group, the Centre for Competition Regulation and Economic Development (CCRED) has shown that the relative contribution of mining to GDP in Botswana has been on the decline since 1990, and will continue to do so, owing to the depletion of diamond deposits in the country.
According to the report titled ‘Mining-related national systems of innovation in Southern Africa: National trajectories and regional integration’, unlike in South Africa, Zambia and Zimbabwe where the contribution of mining to GDP has increased since the 2000s, the opposite is true for Botswana whose diamonds are anticipated to run out by 2050.
The report further states that the manufacturing sector in Botswana showed an increase in its contribution to GDP of 1% between 1990 and 2000, and 0.1% between 2000 and 2014. The report also highlights that the highest value-added services related to mining and manufacturing (engineering, logistics and the like) have seen relatively low levels of localisation in Botswana.
“These dynamics highlight how important it is to promote formal manufacturing activities to create employment and value addition. For this reason, all these countries are engaging with linkage development strategies aimed at building upstream and downstream industries to mining,” read part of the report.
According to CCRED, there is growing importance of services. Employment has shifted to low productivity service sectors (government and community services and wholesale and retail), while high productivity sectors, such as finance, business services, and telecommunications, which are high-skills intensive, are not absorbing large shares of the labour force.