Economical overview
Thanks to large diamond assets, Botswana has
in a few decades gone from being poor to being
classified as a middle-income country. Stability and
well-considered economic policy have contributed to what
is often regarded as an African success story. At the
same time, the income gaps are still very large.
At independence in 1966, Botswana was one of the
world's poorest countries, but soon afterwards the first
diamonds were found. The country has long been the
world's largest diamond producer in terms of value
(Russia is larger in terms of quantity) and accounts for
about one-fifth of total production. Revenue from
diamond trade varies, but the gemstone has generally
accounted for between just over 50 percent and nearly 90
percent of export earnings. The global financial crisis
made 2009 a bleak exception. The diamond trade collapsed
and revenue almost halved, but already recovered the
following year. 2012 was again a tough year with reduced
diamond production at the same time as the country
suffered from both drought and flood problems.
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Countryaah.com:
Major imports by Botswana, covering a full list of top products imported by the country and trade value for each product category.
No "blood diamonds"
The mining sector as a whole normally accounts for
between just over 30 percent and just over 40 percent of
the gross domestic product (GDP), where diamonds make up
the majority. Tourism accounts for just over 10 percent
of GDP. Financial services are another important element
of the service sector. Agriculture's share of GDP has
fallen sharply, but agriculture is still the main
occupation for almost half of the Botswani.
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Abbreviationfinder.org: Check this abbreviation website to find three letter ISO codes for all countries in the world, including BWA which represents the country of Botswana.
In order to reduce dependence on diamond exports, the
government is trying to stimulate foreign investment and
support small businesses. However, the willingness to
invest has been adversely affected by, among other
things, the AIDS epidemic and the unrest in Zimbabwe.
Nevertheless, international organizations still rank
Botswana as the least corrupt and most creditworthy
country in Africa. The attention to "blood diamonds" in
other African countries also gives the country an
advantage. Here are good working conditions in the
diamond industry. The trade in gemstones has not
financed arms purchases and conflicts, but has
contributed to giving residents access to education and
basic health care.
Low foreign debt
Previously, virtually all diamond processing took
place in the United Kingdom, but since 2013 there has
been a diamond trading center (DTCB) in Gaborone where
sorting and processing is carried out. Thus, for the
first time, it is possible to sell directly from
Botswana to the global market. All diamond handling is
handled by the company Debswana, which is owned equally
by the Botswana state and the South African mining group
De Beers.
The state budget has generally shown a substantial
surplus. However, loss of revenue in the mining industry
produces deficits in certain years. The country has also
for a long time had a surplus in foreign trade, which
has led to a low foreign debt and a very strong foreign
exchange reserve.
Over a couple of decades, into the 1990s, the economy
grew by about 9 percent a year. During the period 2000
to 2008, growth averaged just under 5 percent per year.
In 2009, the economy temporarily shrank due to the
international financial crisis. In 2012–2014, the
economy grew by just over 6 percent a year. Slower
growth in the world economy and thus reduced demand for
diamonds has since hampered development. For 2016,
growth forecasts were between 3 and 4 percent.
FACTS - FINANCE
GDP per person
US $ 8,259 (2018)
Total GDP
US $ 18,616 million (2018)
GDP growth
4.5 percent (2018)
Agriculture's share of GDP
2.0 percent (2018)
Manufacturing industry's share of GDP
5.2 percent (2018)
The service sector's share of GDP
59.5 percent (2018)
Inflation
3.0 percent (2019)
Government debt's share of GDP
12.1 percent (2018)
External debt
US $ 1 740 million (2017)
Currency
populations
Assistance per person
US $ 45 (2017)
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