Latest News

Gilport Lions chairperson and owner, Kelesitse Gilika is fuming over r...
Many will remember the Zebras' 6-1 drubbing at the hands of Guinea in ...
The government has banned the sale and importation of tobacco and it r...
The Botswana Democratic Party (BDP) Members of Parliament (MP) held th...

IMF bullish on Botswana growth prospects

The International Monetary Fund (IMF) sees the Botswana economy growing by higher rates in the next two years due to brighter prospects in the diamond sector. Largely due to a recovery in the diamond sector, the economy grew by an unanticipated 4.3% in 2016.

In a statement released following a recent consultative visit to Botswana, the IMF said following a downturn in 2015, Botswana’s pace of economic activity recovered in 2016, supported by improvements in diamond sales, fiscal stimulus, and an accommodative monetary policy.

“Looking ahead, positive prospects for the diamond sector could lead to somewhat higher rates of GDP {gross domestic product} growth in 2017-2019. Fiscal projections envisage moderate deficits this year and the next, with surpluses thereafter.

The fiscal profile is predicated on the authorities’ intention to increase tax revenues and slowdown the pace of spending on wages and salaries and on transfers to state-owned enterprises,” read the statement.

Led by Enrique Gelbard, an IMF team was in the country from May 1 to 6 for discussions on the 2017 Article IV Consultation with Botswana.  The discussions covered recent developments and prospects and focused on policies to support continued economic stability and promote inclusive growth.

 In the past year, Botswana spending rose in line with the government’s Economic Stimulus Programme (ESP) but the fiscal deficit fell to about one percent of  GDP owing to higher revenues from diamonds.

In view of government intentions to increase tax revenues and slow spending, the IMF urged for tax revenue reforms to be accelerated to protect public finances against any

adverse developments and maintain the country’s track record of sound fiscal management.

“As the economy finishes its cyclical recovery, and considering the challenges to foster private sector growth and employment creation, the authorities plan to tilt the composition of public spending to favour investment in physical and human capital, a move to be accompanied with steps to improve the quality and effectiveness of such spending.

Furthermore, a focus on activities with economy-wide benefits will be critical in the period ahead,” said Gelbard in the statement.

To complement these efforts, Gelbard said the authorities need to proceed with the privatisation process and reforms to improve the efficiency and financial viability of government enterprises, reduce bureaucratic procedures for private businesses, and improve education outcomes and the skills of the labour force.

On employment creation, the IMF urged the government to promote economic diversification into selected sectors with growth and employment potential such as tourism in the north of the country. 

While in the country the IMF staff team met with the Minister of Finance and Economic Development, Kenneth Matambo, the governor of the Bank of Botswana, Moses Pelaelo, the permanent secretary in the Ministry of Finance and Economic Development, Solomon Sekwakwa, other senior government officials and representatives of the private sector and development partners.




A luta continua

Latest Frontpages

Todays Paper Todays Paper Todays Paper Todays Paper Todays Paper Todays Paper