Botswana Economy
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Heritage Foundation’s Index of Economic Freedom for 2008, ranked Botswana as the 36th freest economy in world. Heritage Foundation found economy of Botswana to be 68.6 percent.
Economic freedom in Botswana
Strong property rights, financial freedom, investment freedom, labor freedom, and lower corruption are some factors working in favor of Botswana. Another area of strength for Botswana’s economy includes an independent judiciary. Botswana’s financial sector sees little intervention from government sector.
Botswana GDP
As per CIA World Factbook, total GDP of Botswana was around $26.04 billion in 2007. GDP per capita was estimated to be around $14,300 in 2007. Industry and services continue to dominate Botswana’s economy with agriculture lagging far behind. Taken together, industry and services account for more than 90 percent of Botswana’s GDP.
Inflation
Average inflation in Botswana stood at around 10.2 percent for the time period between 2004-06. Government has some degree of influence over prices in Botswana. CIA estimates indicate that inflation in Botswana had dropped down to 7.1 percent in 2007.
Imports and exports
Total imports into Botswana amounted to more than $3 billion in 2007. Major commodities imported into Botswana include machinery, fuel and petroleum products, foodstuffs, textiles, transport equipments, and metal. Southern African Customs Union accounted for a lion’s share (70%) of commodities imported into Botswana.
Total exports of Botswana amounted to more than $5 billion in 2007. Major commodities exported into Botswana were diamonds, nickel, soda ash, meat, copper, and textiles. In 2007, European Free Trade Association was Botswana’s major export partner and accounted for 87 percent of the nation’s total exports.
Weaknesses
Lack of trade freedom and monetary freedom continue to challenge Botswana’s economy. Bans are imposed on import of certain products into Botswana. Government bias in procurement further hampers Botswana’s economy.
Future of Botswana
So far, Botswana’s economic growth story has been quite remarkable. But, Botswana has to address issues like rising unemployment and poverty to sustain economic growth. Another factor that may affect Botswana’s economy, is its status as the country with second highest HIV/ AIDS infection rate. Diamond mining has always been a major source of revenue for Botswana and may continue to be so for some more years
