Economy - overview:
Until the beginning of the global recession in 2008, Botswana maintained one of the world's highest economic growth rates since its independence in 1966. Botswana recovered from the global recession in 2010, but only grew modestly until 2017, primarily due to a downturn in the global diamond market, though water and power shortages also played a role. Through fiscal discipline and sound management, Botswana has transformed itself from one of the poorest countries in the world five decades ago into a middle-income country with a per capita GDP of approximately $18,100 in 2017. Botswana also ranks as one of the least corrupt and best places to do business in Sub-Saharan Africa.
Because of its heavy reliance on diamond exports, Botswana’s economy closely follows global price trends for that one commodity. Diamond mining fueled much of Botswana’s past economic expansion and currently accounts for one-quarter of GDP, approximately 85% of export earnings, and about one-third of the government's revenues. In 2017, Diamond exports increased to the highest levels since 2013 at about 22 million carats of output, driving Botswana’s economic growth to about 4.5% and increasing foreign exchange reserves to about 45% of GDP. De Beers, a major international diamond company, signed a 10-year deal with Botswana in 2012 and moved its rough stone sorting and trading division from London to Gaborone in 2013. The move was geared to support the development of Botswana's nascent downstream diamond industry.
Tourism is a secondary earner of foreign exchange and many Batswana engage in tourism-related services, subsistence farming, and cattle rearing. According to official government statistics, unemployment is around 20%, but unofficial estimates run much higher. The prevalence of HIV/AIDS is second highest in the world and threatens the country's impressive economic gains.
Definition: This entry briefly describes five economic components for a given country:
* National Economy, including a brief economic history;
* Domestic Markets, including labor and wage markets as well as brief commentary on economic sector portfolios;
* Financial Power and Public Finance, including brief discussions of financial market strengths and security, lending/exchange rates (especially if abnormalities exist), and foreign direct investments;
* Trade Power and Influence, including brief commentary on chief imports and exports; and
* Regional Strategy and Efforts, including key partners, regional economic development efforts, and any underlying economic data integrity concerns.
Source: CIA World Factbook - This page was last updated on Saturday, September 18, 2021
