Kasane — The deputy managing director of the International Monetary Fund (IMF), Mr Tao Zhang has hailed President Dr Mokgweetsi Masisi for his vision for a new growth model to accelerate the country's transition to high-income status.
Mr Zhang, who was speaking at a two-day workshop organised by Bank of Botswana, IMF and other stakeholders in Kasane, said it was encouraging to see the political will of the country being strong and supportive.
"Prior to coming here, I had the privilege of discussing these issues with His Excellency President Masisi.
I can assure you that we are on the same page. The political will is strong and this is perhaps one of the most important factors for the success of any strategy.
We also agreed that this workshop is timely as the authorities are polishing their strategy and reassessing the growth policies currently in place," he said.
However, he warned Botswana to guard against external shocks to the diamond market and that of climate change.
Mr Zhang explained that the short-term look could only be addressed by diversifying the economy, adding that the workshop was also timely for IMF because in October 2020, an edition of the regional economic outlook for the Sub-Saharan African region would examine export diversification in the region.
"I can also tell you that we have experienced increasing demand from our member countries to deepen our work on issues like how to achieve diversification, including export diversification," he added.
Mr Zhang explained that Botswana had made clear its objectives on diversifying the economy to transit the country intro a high income status, saying "what remains is how best to achieve them."
He noted that to achieve the goals, there were more questions to be answered by decision makers in Botswana and other countries.
He added that they include but not limited to macro-economic stability and a predictable policy environment, saying they were critical to supporting good outcomes from the interventions, the role of the government, obstructing market failures, reliance on Foreign Direct Investment, which the Fund (IMF) believed in.
He advised that if policymakers decided to support a particular sector, then they should know how to support, regulate and even give incentives for the sector.
"There is, of course, a wide range of policies including specific tax incentives, tariff and non-tariff barriers, cheap financing for special economic zones and public research and development," said Mr Zhang.
At the workshop, Botswana will present a topic on the country's macro-economic experience, especially in regard to diversification and its development objectives.
Other topics to be discussed include the role of industrial policies and public finance management in fostering diversification and growth.