23 Sep 2014

Minister of Finance and Development Planning, Mr Kenneth Matambo says accelerating economic growth and diversification as well as creating more employment opportunities and reducing poverty had remained a challenge.

That, Mr Matambo said was despite government’s efforts over the years to implement several economic policies and structural reforms aimed at widening the production and export base of the economy. 

The finance minister was addressing the 2014 general stakeholders Budget Pitso recently. 

Mr Matambo told stakeholders that to address these challenges, government aimed at; promoting inclusive and sustainable economic growth, improving factor productivity, developing appropriate skills and implementing revised fiscal expenditure and revenue rules.

Further, he said in 2013 the domestic economy performed relatively well as a result of the positive trend in the global economic growth, especially in advanced economies.

Real GDP, he said grew by 5.9 per cent in 2014, compared to a much lower rate of 4.3 per cent in 2012. 

However, he said the main risk to such growth, could not be overlooked as any slowdown in advanced economies always translated into poor performance of the country’s mineral exports and domestic output. 

For instance, the minister said total exports in the first quarter of 2014 experienced a substantial slowdown, because of the decline in diamond exports, adding that the slowdown in exports demonstrated the vulnerability of Botswana’s economy to international shocks. 

That, he said called for the need for value addition and prioritising expenditure towards production entities and sectors that had relatively higher impact on the growth of the economy. 

“Similarly, this implies giving priority to industries which have higher backward and forward linkages with other sectors. This is where the private sector can take advantage of existing and new opportunities and play an active role in leading our development agenda,” he added.

The 2015/16 Budget Strategy Paper provides a review of economic developments suggests national priorities and presents forecasts of resource availability. 

The paper also provides both global and domestic economic dimensions, as well as, a summary of policy thrusts and strategists, which are deemed necessary to unlick additional sources of growth for the country’s economy, going forward. 

The 2014 general stakeholders budget Pitso is therefore the last under the Tenth National Development Plan (NDP 10) and Vision 2016. 

The 2015/16 financial year, also marks the end of the Millennium Development Goals (MDG) which has been guiding the international development agenda on issues such as poverty, unemployment and gender, among others. 

Going forward, Mr Matambo said the strategy should reiterate the importance of maintaining macroeconomic stability as a prerequisite for promoting economic diversification and inclusive growth. 

“In addition, we have to relook at our policy interventions with a view to synchronising the microeconomic and macroeconomic environments in order to realize the sustainability of our growth model,” he added.

The strategies adopted for the financial year 2015/16, he said would be implemented with a view to providing the basis for defining the growth path for the Eleventh National Development. ENDS