Not many post-independence countries had a worse start than Botswana. At independence in 1966, the country had 22 university graduates, about 100 matriculants and only 12km of paved road. However, it has had record economic growth rates, higher than any other country in the world over the past three decades.
Diamonds are at the core of the country’s revenue base, three-quarters of the R16billion in exports from 2003 came from diamonds. Its foreign exchange reserves are worth about R54,3billion, comparable to the positions of oil-rich Kuwait and the United Arab Emirates. The 2004/05 budget had about a 574million pula (about R691,3million) surplus.
But Botswana continues to be plagued by the problems that face many underdeveloped countries. A 1997 poverty study found that 44% of the country’s 1,6million population are poor. A 2000 report found that adult literacy is at about 72%, behind Zimbabwe’s 89%.
The gains, which follow almost two decades of free education, from primary school up to university, may be reversed with the reintroduction of school fees in January this year as part of the government cost recovery plan.
But the greatest threat that the sparsely populated country faces is HIV/Aids. One in three adults is infected and life expectancy is about 40 years of age, even lower than Sudan’s 56.
Botswana is a provider of free healthcare and remains one of the few countries in Africa that makes antiretrovirals available to those citizens who want them.
Unemployment is high, up to 40%. That is the reason Botswana wants to diversify its economy. The country’s bureaucrats are looking to a post-diamond scenario.
As the supplier of about 70% of De Beers diamonds, Botswana’s importance to the global trade was shown by the relocation of the Diamond Trading Company from London to Gaborone.
Bureaucrats hope the establishment of Diamond Trading Company in Botswana will spur the development of other economic sectors. The company is expected to create about 600 jobs.