Diamonds accounted for much of the growth of Botswana’s GDP. De Beers announced a discovery at Orapa in 1967. By 1982 Botswana had two major mines at Orapa and Jwaneng, and by 1990 it was the world’s largest producer of diamonds.
Wealth will be defined as a suitable accumulation of resources and possessions of value.’ Under this simple definition, one is wealthy to the extent that one has sufficient food of good quality, clothing appropriate to keep cool or warm, and shelter for protection from the elements.
The Kalahari Desert, a large semi-arid savannah, covers 70% of Botswana. It is, therefore, no surprise that water is such a valued commodity. In fact, Botswana’s currency is called the Pula which translates to rain in Setswana.
Having enjoyed sub-Saharan Africa’s fastest economic growth for much of the last century, this landlocked country has positioned itself to be an important hub for manufacturing and commerce by leveraging its position as a gateway to the Southern African market.
Despite being the world’s third largest diamond producer, its wealthiest individuals made their fortunes through investments in diverse industries outside the mining sector, and they represent some of the biggest homegrown entities on the Botswana Stock Exchange (BSE).
Botswana’s economy is mostly dependent on diamond mining. Diamond mining contributes to 50% of the government revenue mainly through its 50:50 joint venture with De Beers in the Debswana Diamond Company.
Country group: Developing/Emerging; Upper
GDP by sector: agriculture: 1.8%; industry: 27
GDP growth: : 14.5% (2018) 3.0% (2019e)
Population below poverty line: : 16.3% (2016)
Exports The top exports of Botswana are Diamonds ($4B), Gold ($87.2M), Insulated Wire ($81.9M), Bovine ($46M), and Carbonates ($40.1M), exporting mostly to Belgium ($951M), United Arab Emirates ($934M), India ($901M), South Africa ($574M), and Singapore ($277M).
How did Botswana get so rich?
Botswana’s impressive economic record compared to some of its neighbors has been built on a foundation of diamond mining, prudent fiscal policies, and a cautious foreign policy. Botswana’s economy is mostly dependent on diamond mining.
Why was Botswana so successful?
The success of Botswana is due to its adoption of good policies. These have prompted rapid accumulation, investment, and the socially efficient exploitation of resource rents. These policies resulted from an underlying set of institutions of private property that encouraged investment and economic development.
Why Botswana is the fastest growing economy?
Botswana was the world’s fastest growing economy from 1966 to 1989. Rapid growth was to be expected because of the discovery of large diamond deposits. What is unusual is that the economy has not suffered from the Dutch Disease, as is common in mineral boom economies.
Why is Botswana so developed?
Botswana’s success is closely linked to its strong political and economic institutions, which have made the Sub-Saharan country the most prosperous nation in the region.