IMF predicts rosy outlook for Botswana

The April report of the International Monetary Fund's World Economic Outlook released last week predicts that Botswana's economy will expand by 6.3 percent this year and by 5.1 percent in 2011/12. This is compared to the government's expectations of a five percent economic growth in 2010/11.

Part of this strong recovery, the IMF says, is due to Botswana's policy decision to spend its way through last year's recession, also known as countercyclical fiscal policy.Instead of providing stimulus packages to affected sectors, Botswana opted to maintain, and in some cases ramp up, spending throughout the recession as a way of supporting the economy. As a result, the country ran a deficit of P13.5 billion for 2009/10, partly financed by a P6.6 billion African Development Bank loan and a domestic bond programme.