Gaborone — Botswana's economy is forecast to grow by 3.6 and 4.4 per cent this year and 2020 respectively.
Delivering his first State of the Nation Address after his party's election victory in Parliament on November 18, President Dr Mokgweetsi Masisi said the positive prospects were underpinned by an anticipated increase in non-mining sectors.
It is anticipated that trade, hotels and restaurants, finance and banking as well as the transport and communications sectors would contribute positively to economic growth.
Globally, he said economic growth was expected to register a 3.6 per cent increase next year predicated on fiscal policy stimulus being implemented in China.
Quoting the October International Monetary Fund's economic outlook update, President Masisi said global economic activity had slowed down this year largely due to heightened trade tensions between the US and China.
In Sub-Saharan Africa, he said growth was anticipated to reach 3.2 and 3.6 per cent in 2019 and 2020 respectively.
The growth rates represent slight downward revisions by 1.7 per cent in 2019 and 0.8 per cent in 2020, he said. On foreign exchange reserves, President Masisi said the level stood at P74.2 billion in August, representing a 3.9 per cent increase over the December 2018 figure.
Of the total amount, P19.5 billion or 26 per cent was attributable to the Government Investment Account, he said.
Noting that the reserves had declined by 3.2 per cent last December, the President said this year's increase was due to gains from asset price changes, exchange rate movements and income on reserves."The level of reserves in August 2019 is equivalent to 15 months of import cover of goods and services," he said.
On another positive note, the President said the depreciation of the Pula against the Special Drawing Rights suggested that the country's export competitiveness remained favourable, especially in advanced economies' markets.
In addition, he said the local currency continued to show signs of a stable Real Effective Exchange Rate, which had depreciated by 0.3 per cent up to August this year, reflecting a lower inflation rate in Botswana, compared to that of its trading partners.
President Masisi said it was anticipated that inflation would continue to remain within Bank of Botswana's objective range of 3-6 per cent.
<i>Source : BOPA</i>