IMF Staff Country Reports

Botswana: 2024 Article IV Consultation-Press Release and Staff Report

September 10, 2024

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Format: Chicago

International Monetary Fund. African Dept. "Botswana: 2024 Article IV Consultation-Press Release and Staff Report", IMF Staff Country Reports 2024, 286 (2024), accessed November 23, 2024, https://doi.org/10.5089/9798400288135.002

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Summary

The 2024 Article IV Consultation discusses that Botswana’s economic growth is expected to slow to 1 percent in 2024 primarily because of a diamond market contraction, before picking up next year. Inflation has declined sharply since the peak of mid-2022 and returned to the central bank’s medium-term objective range of 3–6 percent, where it is expected to remain in the medium term. Some fiscal relaxation is warranted this year given the fall in mineral revenues, but the ambitious capital budget should be streamlined to contain the deterioration of the deficit and prioritize projects with the highest value for money. The monetary policy stance is appropriate, but monetary policy transmission remains limited, requiring further deepening of the interbank, credit, and government bond markets along the transmission chain. Reducing inequality and unemployment requires a more job-intensive, private sector-led, and export-oriented growth model. Reform of state-owned enterprises, improved infrastructure for doing business (internet, energy, and logistics), trade facilitation measures, and a more efficient social protection system should be prioritized.

Subject: Environment, Financial sector policy and analysis, Financial sector stability, Non-renewable resources, Public debt, Revenue administration

Keywords: Africa, Diamond market contraction, Financial sector stability, Global, IMF team, IMF's article, Non-renewable resources, Objective range, OPEC Fund for International Development, Project obligations to fund, Southern Africa

Publication Details

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