A river that runs through the marsh in Botswana

Botswana Economic Forecast

Botswana Economic Outlook

In the third quarter of 2022, annual growth accelerated to 6.3% from Q2’s 5.8%. Q3’s growth was underpinned by strong domestic electricity production and the diamond trade. Turning to Q4, the economy likely continued to grow strongly. Diamond prices remained at historically high levels throughout the quarter, while the unemployment rate declined from the year-earlier period. Less positively, exports contracted in October–November, while double-digit inflation likely undermined private consumption. In other news, the government presented the FY 2023 budget on 6 February. It projects a higher deficit than in FY 2022 due to a significant increase in government investment, with BWP 13 billion (around USD 1 billion) earmarked for infrastructure projects.

Botswana Inflation

Inflation in January came in at 9.3%, down from December’s 12.4% but remaining well above the Central Bank’s 3.0–6.0% target range. December’s notable decline was mainly driven by easing transport price pressures. Inflation is expected to ease in 2023 as a whole but to average above the Central Bank’s target.

Botswana Economic Data

2017 2018 2019 2020 2021
Population (million) 2.2 2.3 2.3 2.4 2.4
GDP (USD bn) 16 17 17 15 19
GDP per capita (USD) 7 7 7 6 7
GDP (BWP bn) 167 174 180 171 208
Economic Growth (Nominal GDP, ann. var. %) 1.4 4.2 3.6 -4.7 21.2
Economic Growth (GDP, ann. var. %) 4.1 4.2 3.0 -8.7 11.9
Domestic Demand (ann. var. %) -1.6 5.2 7.1 -0.3 2.3
Private Consumption (ann. var. %) 1.4 5.4 3.1 2.3 2.3
Government Consumption (ann. var. %) -3.3 2.2 10.3 4.0 4.0
Fixed Investment (ann. var. %) -4.6 8.6 10.2 -9.2 0.3
Exports (G&S, ann. var. %) -5.5 11.9 -8.8 -18.6 31.7
Imports (G&S, ann. var. %) -12.9 15.9 11.6 5.0 2.3
Unemployment (% of active population, aop) 21.6 22.1 22.6 24.9 24.7
Fiscal Balance (% of GDP) -1.1 -5.0 -8.5 -11.1 -2.6
Public Debt (% of GDP) 14.5 14.9 16.5 19.0 19.5
Money (ann. var. of M2 %) 2.7 8.3 8.0 5.9 5.0
Inflation (CPI, ann. var. %, eop) 3.2 3.5 2.2 2.2 8.7
Inflation (CPI, ann. var. %, aop) 3.3 3.2 2.8 1.9 6.7
Bank Rate (%, eop) 5.00 4.75 4.75 3.75 3.75
Exchange Rate (BWP per USD, eop) 9.83 10.73 10.58 10.80 11.76
Exchange Rate (BWP per USD, aop) 10.34 10.20 10.76 11.45 11.09
Current Account Balance (USD bn) 0.9 0.1 -1.2 -1.3 -0.1
Current Account Balance (% of GDP) 5.6 0.4 -6.9 -8.6 -0.5
Merchandise Trade Balance (USD bn) 0.8 0.5 -1.1 -2.0 -0.6
Merchandise Exports (USD bn) 6.0 6.6 5.3 4.3 7.3
Merchandise Imports (USD bn) 5.2 6.1 6.3 6.3 8.0
Merchandise Exports (ann. var. %) -19.1 10.5 -20.2 -18.3 70.9
Merchandise Imports (ann. var. %) -12.7 18.5 3.6 -0.9 27.1
Foreign Direct Investment (USD bn) 0.3 0.3 0.1 0.0 0.1
International Reserves (USD bn) 7 7 6 5 5
International Reserves (months of imports) 17.4 13.1 11.7 9.5 7.2
External Debt (USD bn) 1.7 1.8 1.6 1.6 2.0
External Debt (% of GDP) 10.8 10.5 9.4 10.7 10.6

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