AFDB maps Botswana economic strategy
Brian Benza | Tuesday April 8, 2014 11:24
The bank is preparing its 2014 - 2018 Country Strategy Paper for Botswana intended to consolidate strong and sustainable growth in the country. AFDB project Botswana’s economy to grow by 5.5 percent in 2014.
The strategy paper assesses Botswana’s development prospects and challenges, the government’s strategic options, and the specific role the Bank could play, in collaboration with the government and other development partners.
The bank has stated that it is finalising the country strategy paper before submitting it for consideration by the board of directors of the AFDB before the end of June.
While in Botswana, the team held discussions with ministers of Finance and Development Planning Kenneth Matambo and Minerals, Energy and Water Resources’ Kitso Mokaila. The team also met with senior government officials and the Chief Executive of the Botswana Power Corporation such as Jacob Raleru among others.
In previous reports, AFDB reiterated that while Botswana has made remarkable progress in social and human development, as reflected by impressive education and health indicators, the level of poverty remains a major concern for an upper-middle-income country, with 20.7 percent of the population classified as extremely poor.
The talks also covered ongoing bank-funded work in Botswana, with 13 projects underway, with a total value of some US$ 280 million (P2.5 billion). Apart from a $1.5 billion budget support loan Botswana received from AFDB in 2009, the development bank has been involved in funding the Kazungula Bridge, Morupule B power station, a feasibility study of a 200mw solar project and the Pandamatenga infrastructure development project.
The AFDB loan, disbursed from 2009 with a five-year grace period, is scheduled to run until 2029 at an interest rate equal to the bank’s cost of funding plus 0.16 percent.
Cooperation between the AFDB and Botswana dates back to 1972. As of October 2012, the bank had financed 50 operations valued at approximately US $2.1 billion. Bank-funded projects are primarily in the areas of power, transport, water and sanitation, communication, agriculture, finance and multi-sector.
Meanwhile the AFDB has backtracked on its earlier assertion that the Morupule B Power Station was switched on before it was ready.
AFDB says that the visiting mission was also able to clarify the Bank’s position on the Morupule Power Project, following the publication of the Southern Africa Quarterly Overview and Analysis late last year. In last December’s publication AFDB had expressed concerns about the readiness of the power station at the time of commissioning. “Concerns were expressed about the readiness of the project. In particular, it was pointed out that for a project of this nature to be commissioned it needs to meet at least 95 percent of specification output. At the time of the commissioning, the Morupule B fell well below this threshold as it was at 50 percent,” AFDB said in last year’s quarterly report. AFDB now says the comment in the quarterly report did not fully and accurately reflect developments on the project.