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Gov’t eyes greater non-mineral exports

Ntsima’s comments come in the wake of recent Statistics Botswana figures PIC: MTE
 
Ntsima’s comments come in the wake of recent Statistics Botswana figures PIC: MTE

Trade Minister, Tiroeaone Ntsima, told this publication that the government has prioritised certain areas that have potential to boost the export sector, which include the hemp industry, base metal processing, development of Special Economic Zones (SEZ), energy exports, and revamping of the International Financial Services Centre. “Our non-mineral exports are not currently at the desired level as diamonds continue to dominate export revenue,” he said in an interview recently in Algiers, Algeria.

The Minister led the Botswana delegation to the recently ended Intra-African Trade Fair. Ntsima’s comments come in the wake of recent Statistics Botswana figures, which revealed that in the midst of the prolonged diamond downturn, non-mining sectors have helped restrain the contraction in the economy.

The African Continental Free Trade Area (AfCFTA) is expected to be another catalyst for non-mineral exports. The AfCFTA is the world’s largest free trade area developed under the auspices of the African Union (AU) to enable the free flow of goods and services across the continent. It is estimated that the AfCFTA has the potential to boost intra-African trade by 52.3% and also boost the continent’s trading position in the global market.

Ntsima also told Mmegi that to launch Botswana’s exports under AfCFTA, the Ministry had set aside funds to assist companies to start trading under the trade agreement.

“The funds are targeted towards raising awareness about the AfCFTA, assisting companies to meet required compliance standards, and taking companies on promotional missions to explore market opportunities,” he said.

Ntsima added that there is a need to increase the country’s supply capacity by supporting enterprises to produce more exportable products.

“We also need to lobby African countries to remove non-tariff barriers, which increase the cost of trading in Africa. We need to invest in trade support infrastructure to reduce the cost of doing business in Africa. Such could include more push for more rail projects, erection of one-stop border posts, and elimination of visa requirements amongst African nations to ease movement of people and goods,” he said. Non-mining GDP held the fort last year as the only growing sector of the economy, containing a contraction of economic output that could have been significantly worse.

The non-mining sector is also a major employer in the economy, particularly as more mines mechanise and introduce higher technology to boost their efficiencies and reduce overheads.

However, the slowdown in government spending this year is expected to impact the non-mining sector, as procurement by different ministries and departments, as well as local authorities, is a major driver of private sector activity. Statistics Botswana figures show that in the non-mining sector, only agriculture and manufacturing recorded declines during 2024, at 0.3 percent and 0.25 percent, respectively.

Manufacturing remains one of the government’s top priorities for export-led, diversified growth, although the billions of Pula poured annually into various interventions such as loans, grants, mentorship, supplier development support, and others are yet to result in meaningful GDP contributions.

In economics, non-mining GDP refers to the Gross Domestic Product (GDP) of an economy excluding the value added by the mining sector. Essentially, it is a measure of economic output from all industries such as tourism, manufacturing, retail, real estate, and others.