How Can Botswana Build a Future-Proof Economy for the Next Generation?

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Discover how Botswana can build a future-proof economy for the next generation through diversification, innovation, and inclusive growth. Featuring expert insights and actionable strategies.

Botswana at a Turning Point

Botswana, once one of Africa’s fastest-growing economies, is now grappling with slowing growth, rising inequality, and overdependence on diamonds. As the country faces a 3.1% economic contraction in 2024 

, the question becomes urgent: How can Botswana build a future-proof economy for the next generation?

The Middle-Income Trap: A Warning Sign

Botswana’s economic growth has slowed from over 7% annually in the early 2000s to just 3% in recent years 

. The country appears to be caught in the middle-income trap, where growth stagnates due to limited diversification and declining productivity.

“Botswana’s economy has become less efficient over the past decade,” notes a recent World Bank report. “To escape the trap, the country needs sustained productivity growth of at least 1–2% per year” 

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Diversifying Beyond Diamonds

The Urgent Need for Economic Diversification

Diamonds still account for over 70% of Botswana’s exports 

. While the government has made efforts to diversify, progress has been slow.

“We note a growing focus on coal and copper projects,” says Naledi Madala, economist at Absa Bank Botswana. “But diversification must go beyond mining to include services, tech, and agriculture” 

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Key Sectors for the Future

  1. Green Energy – Solar and hydrogen projects can reduce energy imports and create jobs.
  2. Digital Economy – E-commerce, fintech, and digital services offer scalable growth.
  3. Agri-Tech – Modernizing agriculture can boost food security and rural incomes.
  4. Tourism – Eco-tourism and cultural tourism remain underexploited.

Investing in Human Capital

Education and Skills for the 21st Century

Botswana’s education system must evolve to meet the demands of a digital and green economy.

“We need to align our education system with market needs,” says Dr. Keith Jefferis, former Deputy Governor of the Bank of Botswana. “That means more focus on STEM, entrepreneurship, and vocational training.”

Youth Empowerment

With over 60% of the population under 30, Botswana must harness its demographic dividend.

  • Expand access to technical and vocational education.
  • Support youth entrepreneurship through funding and mentorship.
  • Create internship-to-employment pipelines in key industries.

Strengthening Institutions and Governance

Efficiency and Accountability in Public Spending

Botswana’s fiscal deficit peaked at nearly 10% of GDP in 2024 

. To build a resilient economy, the government must improve how it allocates and manages resources.

“The surge in SACU revenue was not prudently managed,” the World Bank notes. “This led to a disproportionate increase in government spending without corresponding productivity gains” 

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Digital Governance

Digitizing public services and procurement can reduce corruption and improve efficiency. The adoption of e-government platforms is a key step toward transparency.

Attracting Sustainable Investment

From Aid to Investment

Botswana must shift from aid dependency to attracting “patient capital”—long-term investments in infrastructure, innovation, and skills.

“The new government has committed to unburden businesses and attract patient investors,” the World Bank reports 

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Improving the Business Climate

  • Simplify business registration and licensing.
  • Offer tax incentives for green and tech startups.
  • Strengthen legal protections for investors and entrepreneurs.

Internal & External Resources

For more on Botswana’s economic transformation, check out our post on Government Tender Policies and Corruption.

The Future Starts Now

Botswana has the talent, resources, and institutional foundation to build a future-proof economy. But it must act decisively


diversifying its industries, investing in youth, and embracing innovation. The next generation is watching.

What’s your vision for Botswana’s future economy?

Join the conversation in the comments below. Share your ideas, challenges, or success stories and don’t forget to subscribe to our newsletter for more insights on African finance and development.


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