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Abstract
Botswana’s economic transformation during the past 30 years is one of the most highly regarded success stories of the African continent. Real GDP grew at an average annual rate of 13.9 percent between 1965 and 1980, and 11.3 percent between 1980 and 1989, making Botswana the world’s fastest-growing economy during the period. Between 1990 and 1998, however, GDP growth averaged only 4.75 percent a year. Real GDP per capita increased by an average of 5 percent a year, reaching $3,417 in 1997/98 and $3,170 in 2003. Botswana made major strides in terms of standard development indices as well. The under-5 mortality rate, which had been 151 per 1,000 live births in 1971, declined to 48 per 1,000 by 1991. By 1996 net primary enrollment was 95 percent, more than double the 1971 rate. In 1993, 47 percent of Batswana (the name for the people of Botswana) lived below the official poverty threshold, compared with 59 percent in 1985. These substantial economic gains resulted in part from the discovery of large mineral deposits in 1968, and mining value added now accounts for about a third of GDP. But in addition to the discovery of diamonds, the pursuit of prudent and consistent macroeconomic policies has resulted in a stable macroeconomic environment.
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