BOTSWANA : A POST PANDEMIC ECONOMY

moleta ngwedi O leta lefifi -One who waits for the moon also waits for darkness

setswana proverb

One could be forgiven for thinking that the world experienced a pandemic in 2020. The totally empty streets and highways of extremely busy cities across the african continent was like a painful joy: perhaps the gods of global warming and pollution must have heaved a sigh of relief. This was to one part, a joy . The other part of economic activities grinding to a halt was no less a darker cloud, masking behind the difficulties of a new era. Face masks have become the must have accessory for public movement and companies and small businesses have been counting their losses:

The onus has been on the continent to adapt to the new economic condition or pivot as a turning point in its development. Although, Africa was not particularly hit by Covid-19, the impact of the lockdown on economic activities clearly showed the need for african nations to boost certain sectors of the economy like agriculture, health, technology , security etc. The reopening of cities to business activities created chaos as supply across commodities were exhausted (in relief aid and panic buys) and with no production during those periods, there was a huge gap in demand and supply. Prices of products generally rose and most african countries saw inflation rates rising dramatically : Nigeria rising by almost 3% within that period, South Africa also rising from 2% to 3.3% in the same period) .While Nigeria’s case (which could be excused for dollar scarcity and insurgency attacks),shows no signs of abaiting, South Africa’s bounce back towards the end of the 3rd Quarter and into 2021 is not just reflective of increased production and diversification: it is a trend taking place towards southern Africa.

Nigeria Inflation rates (2020 – 2021)


source: tradingeconomics.com

Botswana, like most southern African countries has a huge chunk of its GDP contribution from mineral resources and the provision of services.It is the 2nd Largest producer of diamonds globally and this sector forms a major part of its GDP . The country was among the hardest hit by COVID-19, as GDP fell to almost -28% from 2.3% in the last quarter, led by mining (falling by almost -60% from -6% previously). However , One particular sector recorded quite an impreessive growth with GDP from the sector rising from 377 million to 396 million BWP (Botswana Pula ) : Agriculture

February 2020.

Dr Taphelo Masheka , The Batswana Minister for Finance and economic development in his 2020 budget speech had stated the need for agriculture to be included as a focal sector in the transformation agenda of the NDP 11( National Development plan 11) :

Government will be refocusing attention to Agriculture and manufacturing sectors…as these sectors have the potential to boost economic growth , create job ,promote exports and reduce poverty …

Excerpts from the Botswana Budget plan 2020

Dr Taphelo Matsheka, Minister of Finance and Economic development

December 2020.

Some of the policies revived seemed to have yielded fruit : NAAMPAAD (National masterplan for the arable agriculture and diary development) and ISPAAD (Integrated support program for Arable agriculture development have been to able to assist farmers by enhancing their access to input and providing extension services to boost productivity and ensure food self sufficiency : A scarce theme across african economies. These programmes have been in existence since 2008 . However, consistent programme flagoffs and completion have ensured stable progress over the years, culminating in gradual growth in its GDP contribution and sheiding the economy from the shortfalls of global diamond price falls and pandemic situations like these. These policies have led to increased growth in both production and profits for grain crops and contributing to reducing the employment deficit.

While economies across the continent gradually pick themselves over this period, some countries might wish they had been engaged in sector growth diversification to survive such situations. Nigeria is a prime example; the global fall in oil prices just before the pandemic coupled with lockdown and growing insecurity has left the nations coffers empty, depending on dollar injection to boost its economy and making scrambled last -ditch efforts to revive sectors that it had totally abandoned. This is a case of most African countries as the IMF and world bank are looking towards targeted aid to as many as 18 states in the region.

For Botswana (in a southern african region that is more service and mining oriented), It would be a case of celebrating some small wins to towards its 2036 vision of “raising income status to an average middle income by the time period. While we watch however, other nations must need a new focus : a focus on sector diversification, leveraging on the growth of bigger sectors to boost those still growing. For example, leveraging on its much more stable services sector to provide basic technology to improve crop production , ensure better costing and sales and increase farmers profits.

However , While we still sit in the darkness of mono economy and rigid policies, we must wait for that moon of sector reforms, better focus and more diversified plans.