Botswana's economic recovery at risk: president
GABORONE, Nov. 28 (Xinhua) -- Botswana's president Ian Khama said on Thursday that the country's economic recovery has been a challenge to sustain due to the uncertainty of global demand for diamonds in the coming years.
Addressing local business community on Thursday, Khama said Botswana's annual growth rate declined from 6.1 percent in 2011 to 4.2 percent in 2012 and ultimately to 3.6 percent in the second quarter of 2013.
"Deceleration in real gross domestic product (GDP) in 2012 was mainly due to the mining sector, which is dependent on global demand, which declined by 7.0 percent," Khama said.
Botswana's economy depends heavily on mining industry which accounts for 30 percent of GDP, above 50 percent of national revenues and 70 percent of export earnings. Fluctuation in global markets for minerals, especially rough diamonds, will impact the economy significantly.
However, Khama said the year of 2012 saw the non-mining sectors growing by 6.2 percent, adding this being a very positive sign of the country's efforts towards economic diversification.
He urged local business community to maintain self-restraint and vigilance and support government efforts for sustained growth in the economy, as the threat of the economic downturn is still real.
"Government continues to work aggressively to catapult diversification and sustain growth in the economy. However, I wish to emphasize that this objective is not to be achieved by the government alone," Khama said.
"The private sector needs to actively and productively participate to drive and sustain this growth."
Khama said though global prospects are now showing positive signals, the road to recovery still remains uncertain.
World output growth is forecast to reach 2.9 percent in 2013 and possibly 3.6 percent in 2014. In the major advanced economies, activity is expected to gradually accelerate, however risks remain.
Projections in the medium term for Botswana indicate moderate economic growth of around 4.9 percent per annum through to 2014, predicated on gloomy global prospects and the associated slow recovery of the mining sector, Khama said.