Country Private Sector Diagnostic

Creating Markets in Botswana: Country Private Sector Diagnostic

June 29, 2022

A Diamond in the Rough: Toward a New Strategy for Diversification and Private Sector Growth

Botswana can speed economic transformation and stimulate resilient, green, and sustainable growth by harnessing the power of the private sector in key sectors and generally across the economy. This is the main finding of the Botswana Country Private Sector Diagnostic (CPSD), which was jointly prepared by IFC and the World Bank.

The report examines how Botswana can address private sector constraints in key enabling sectors with high potential for growth, such as energy, water and sanitation, and tourism, to create jobs, reduce inequality, and diversify the country’s diamond-dependent economy.

Botswana stands out among countries in Africa for its successful development policy, economic performance, and long track record of macroeconomic stability. The country has implemented many favorable investment policy measures that have contributed to significant investments in infrastructure, education, health, and social protection. However, there is still room for improvement to boost human capital indicators, and reduce unemployment and inequality.

The CPSD outlines the negative impacts of Botswana’s state footprint on competition in key sectors and its diamond-reliant growth model. It highlights regulatory gaps that hamper competition and productivity, and private sector investment, noting areas where Botswana can strengthen reforms to increase private sector participation and where the World Bank Group can best provide support.