BOTSWANA’S economy would shrink as much as first feared this year owing to better-than-expected mining output and a shorter lockdown, said Reuters which cited the comments of the country’s central bank.
The economy would shrink by 8.9%, the bank said. This was less than the 13.3% decline in economic activity first forecast when lockdowns were first imposed amid the initial onset of the COVID-19 pandemic.
Botswana, which has just 65 reported coronaries infections and one death, ended a 48-day national lockdown on May 21, allowing businesses and schools to reopen, said Reuters.
“The ministry of finance now sees a lower economic contraction in 2020. The first number was based on an assumption of a longer lockdown and larger contraction in mining activities,” said Tshokologo Kganetsano, director of research and financial stability at the central bank.
However, the economy has still been damaged by the coronavirus outbreak. Its budget deficit is expected to more than double as reduced diamond sales and exports hit revenues.
Mining, the country’s biggest revenue earner, has been hampered by the pandemic with diamond buyers unable to travel to Botswana to view and buy diamonds, said Reuters.