Botswana has been ranked among the top ten countries in the emerging markets that are most optimistic about the economic outlook in 2015, according to a Grant Thornton International Business Report (IBR).
This is despite the general fall in confidence globally with the uncertainty weighing heavily on business growth prospects. The report stated that Botswana, which is the only African country on the top list, ranked position seven with a business confidence of 54 percent. The most optimistic country in the top ten was India with a confidence rate of 98 percent followed by Ireland of 82 percent. Germany was the tenth most optimistic country with a rate of 51 percent. A total of 35 countries were surveyed in the index.
Under the surveyed categories, Botswana ranks top in businesses expecting an increase in investment over the next 12 months. Furthermore, over the same period, 68 percent of businesses in Botswana are most likely to increase their staff headcount.
Botswana businesses are also expecting to increase worker salaries above inflation. “Plant and machinery is expected to record a 72 percent increase while new buildings will be 60 percent. This has shown an increase over the last quarter of 2014, with a growth from 54 percent to 74 percent with regard to research and development expectations,” the report said.
Furthermore, Botswana expects an increase in both revenue and profit growth, which are expected to rise from 88 percent to 92 percent and 80 percent to 96 percent respectively. Assessing Botswana’s optimism, Vijay Kalyanaraman, Partner at Grant Thornton said that it is energising to see the optimistic outlook of Botswana relative to other countries. “Government still remains the major driver for growth, the key reflecting business optimism into reality is the implementation of initiatives and easing of procedures involved in setting up and running businesses in Botswana, which will make a positive difference,” he said.
Other countries that made it are Indian Ireland, New Zealand, Australia, United Kingdom, United States of America, Mexico, Canada and Germany.
On the global scale, the IBR shows that while business confidence in 2014 climbed to impressive levels since before the financial crisis, a recent spate of uncertainty was weighing on growth prospects for the year ahead. “With oil prices plummeting, the future of the Eurozone is still far from secure, tensions in Ukraine and concern around the pace of the slowdown in China and the confidence of business leaders, especially in the world’s largest three economies, has slipped as we enter 2015,” the IBR stated.
Earlier this year, Bank of Botswana Business Expectation Survey (BES) revealed that business confidence had surged substantially this year. Based on perceptions among the local business community about the prevailing state of the economy, the survey stated that overall confidence in the prevailing business conditions during the second half of 2014 stood at 52 percent.