Monday, October 25, 2021

Most African economies will grow insignificantly

The Bank of Botswana’s bi-annual Business Expectations Survey (BES) report has indicated that economic growth of most African countries will record a single digit growth for both 2017 and 2018. 

The report states that it is anticipated that most economies will register a 3.5 percent growth in 2017 before slightly picking up the pace to 3.6 percent in 2018. 

Official statistics provided by the government statistics agency, Statistics Botswana (SB), shows that domestic economy significantly improved in 2016 compared to 2015. The Real GDP growth has been pegged at 4.3 percent following a contraction of 1.7 percent in 2015. 

Economic experts have nonetheless indicated that the recovery in economic activity mainly reflects the strengthening of the non-mining sector, which grew by 5.5 percent in 2016 compared to a contraction of 1.7 percent in 2015. 

Due to liquidations and subsequent closure of some mines in the country, the mining sector output declined at a slower rate of 3.7 percent in 2016, compared to a contraction of 19.6 percent in 2015, thus putting more pressure on the diamond market to back up the economy. The contraction in 2016 mainly reflects a reduction of 21.2 percent in copper and nickel output, following the closure of the BCL and Tati Nickel Mining Company in October 2016. 

Experts have also cautioned that the recent decline of South Africa’s investment in Botswana can also undermine growth by straining the private sector’s investment in the country. Higher inflation, lower exports and SACU revenue are the risks that are likely to take the country to drags though expected at a lower rate.

South Africa’s economy shows possible growth of 0.8 percent for 2017 and 1.6 percent for 2018. The recent economic performance of the neighbouring country is said to have a negative impact on countries such as Botswana, especially with its political uncertainty and unstable economy. 

RELATED STORIES

Read this week's paper