A strong showing by non-mining sector has boosted Botswana’s economy in the fourth quarter of 2017, figures from the government statistics agency ÔÇô Statistics Botswana (SB) shows.
The SB data shows that non-mining GDP increased by 7.2 percent in the fourth quarter of 2017 compared to 15.7 percent registered in the same quarter of the previous year.
The data also shows that Real Gross Domestic Product (GDP) in the fourth quarter expanded by 5.5 percent as it made a recovery from the 1 percent decline in the third quarter.
On a quarter-to-quarter basis, the estimated GDP at current prices for the fourth quarter of 2017 was P46.7 billion compared to a revised level of P45 billion registered in the third quarter of 2017. GDP at current prices also known as nominal GDP measures GDP using the current price level.
The estimated GDP at constant 2006 prices for the fourth quarter of 2017 was P23.9 billion compared to P22.7 billion registered in the third quarter of 2016. GDP at constant prices is known as the real GDP as it is adjusted for inflation, that is, it adjusts GDP for changes in prices.
On a year to year basis, the domestic economy grew by 6.5 percent compared to the annual GDP growth rate 4.3 percent in 2016. The Trade, Hotels & Restaurants and Business Services were the bright spots of the economy as they expanded by 18.1 and 4.6 percent respectively.
Trade, Hotels & Restaurants growth was on the account of increase in real value added of wholesaler sub-sector as downstream diamond industries contributed positively to the industry. The increases of 4.6 percent in the real value added of the Finance and Business Services industry was mainly due to the rise in the value added of Real Estate and Business Services by 9.3 and 8.5 percent respectively.
All other industries recorded positive growths of more than 0.2 percent with the exception of water and electricity which decreased by 35.1 percent. The decrease in the Electricity real value added is attributed to a decline in local electricity production by 7.1 percent.
The figures from Statistics Botswana show an increase of 0.2 percent in the real mining value as diamond and coal companies ramped up production. Liboam Holdings known as Mowana and Thakadu copper mines resumed operations during the second quarter of 2017 after being placed under care and maintenance in 2015 due to unfavourable commodity prices.
The latest data reflects a historic GDP growth in the past 5 years following growth of 4.3 percent in the previous year, 4.1 percent expansion in 2014 and a contraction of 1.7 percent in 2015. The positive GDP growth in 2017 has surpassed the 4.7 percent that was forecasted for 2017 by the Ministry of Finance and Economic Development.
According to Minister Kenneth Matambo, Botswana’s economy is expected to keep up the momentum with projected GDP growth rates of 5.3 percent in 2018, on the back of positive outlook for both the mining sector and non-mining sectors.
“Mining sector performance is expected to benefit from the recovery in the global economy, while that of non-mining sectors reflects the impact of Government’s interventions in terms of policies and strategies to diversify the country’s sources of growth,” Matambo said when delivering the budget speech earlier this year.