According to his budget speech yesterday, Matambo expects 2018 growth to reach 5.3 percent from 4.7 percent in 2017, while revenues will jump to P64.3 billion from the revised 2017/18 figure of P57.2 billion.
By comparison, the World Bank in January forecast Botswana’s growth at 4.7 percent in 2018 and 4.5 percent in 2017.
The increase in both growth and revenues is underpinned by Matambo’s projection of a 51 percent leap in mineral revenues in 2018/19 to P24.6 billion.
The stronger forecasts will go some way towards ameliorating the lower projected contribution of customs earnings to revenues, which Matambo said would be under pressure from “weaker–than–expected imports and household consumption in the region”.
“Mining sector performance is expected to benefit from the recovery in the global economy, while that of non-mining sectors reflects the impact of government’s interventions in terms of policies and strategies to diversify the country’s sources of growth.”
In January, the IMF upgraded its global growth forecast by 0.2 percentage points to 3.9 percent, citing increased global growth momentum and the expected impact of recently approved U.S. tax policy changes.
Matambo’s forecasts were welcomed by local analysts, with Grant Thornton Botswana partner, Vijay Kalyanaraman saying the firm was looking forward to seeing the effect of the budget’s strategic thrust on key focus areas.
“The improved outlook of economic growth reflects renewed optimism in Botswana,” he said.