Botswana is set to receive up to $1 billion in support from the African Development Bank (AfDB) to accelerate its shift towards private sector-led growth, with $304 million available for disbursement this year under the Bank’s medium-term initiatives.
During a high-level meeting on 15 April in Gaborone, Vice President and Finance Minister Ndaba Gaolathe reaffirmed Botswana’s long-standing partnership with the AfDB and outlined the country’s reform agenda.
Top on the list are digitisation, agricultural commercialisation, revitalisation of state-owned enterprises, and unlocking private sector capital for economic transformation, a statement released by the lender over the weekend stated.
“We are well placed to deepen the relationship with the African Development Bank to support private sector initiatives,” Gaolathe said, highlighting the country’s ambition to become a key player in the automotive industry.
The pivot away from public sector dominance aligns with recent calls by the World Bank for Botswana to urgently diversify its economy.
In an April 4 report, the Washington-based lender warned that despite historically prudent management of diamond revenues, the country remains overly reliant on the precious stones, which still account for more than 70% of total exports.
“Since transformative growth is unlikely to come from the diamond sector alone, policymakers must identify new drivers of inclusive growth,” the report noted.
It added that rethinking the state’s dominance—including that of state-owned enterprises—will be essential for fostering innovation, job creation and attracting foreign direct investment.
The AfDB’s latest commitment includes backing for the Governance and Economic Resilience Program (GERSP), which will strengthen fiscal performance and deepen private sector participation.
Other focus areas include technical assistance for public investment implementation, comprehensive transport infrastructure, and water security through the Lesotho-Botswana Water Transfer Project.
“Our evaluation points to reforms, capacity development, and enhancement of the private sector as key to the country’s economic development,” said Leila Mokaddem, AfDB’s Director General for Southern Africa.
“Issues such as water, energy, and skills mismatch need to be addressed for the private sector to develop and grow.”
Mokaddem noted that Botswana has the potential to emerge as a regional logistics and manufacturing hub if it sustains its reform momentum.
