Speaking in Parliament recently, Gaolathe who also doubles as Finance minister, said at a national economic level the economy continues to operate smoothly supported by a stable macroeconomic and financial environment. "It is important to acknowledge that the revenue has been declining and this has affected the buffers and government operations," he revealed.
The minister was responding to a question from Maun West legislator, Caterpillar Hikuama, who had asked about the performance of the economy and state of finances. Gaolathe, whose party won the 2024 General Election last month, was also quick to admit that the country has stringent cash conditions. He, however, assured Batswana that the fundamentals from which they can build a deep and robust economy are there. Gaolathe further admitted that they have some temporary cash flow problems and that in the long run, the government will hit the ground running.
The Vice President reiterated what has been said by the past regime that the cause of all this is the weak performance of the diamond trading and utilities sector. He said diamonds suffered from subdued global demand. "On the basis of the ongoing challenges in the diamond sector, domestic economic performance weakened in the first half of 2024, having contracted an average of 2.9 percent a stark contrast to the 4.3 percent growth recorded during the same period in 2023," Gaolathe highlighted. The newly elected Vice President also disclosed that total expenditure and net lending are consistent with government's decision of August 2024 to reprioritise spending in response to the unfavourable revenue profile.
Gaolathe reiterated information shared by former Finance minister, Peggy Serame, indicating that the Government Investment Account has decreased to lower cash inflows compared to outflows. As an economist, Gaolathe expressed hope that the new administration led by President Duma Boko will help improve the situation.
