Country Rankings - Botswana
Feb 21, 2017 Botswana: shinesIf I was asked to sum up the history of sub-Saharan Africa's post-decolonization in one word, I would probably choose the adjective "tragic." For it is difficult to find many positives in an era wracked by war and famine, and marked by despots, corruption, failed states ,and opportunities squandered. There is though, one ray of sunshine: Botswana. Peaceful, stable, and moderately wealthy, Botswana is arguably one the most successful new nations to emerge from colonization. Not all is perfect by any means. But its transformation has been remarkable nevertheless. Fifty years ago, it was one of the poorest countries on earth with GDP per head a mere USD200. Today this nation of 3m souls is classified as a middle-income country, with GDP per head of USD17,000 – higher than any of the exalted members of the BRICS club of leading emerging nations. What's been the secret of its success? Well, since this is a tax publication, it's worth noting the role that low rates of tax have played. Corporate tax is currently 22 percent, and generally government interference in the economy is said to be low. But on a more fundamental level, stable democratic governments, wise political leadership, and sound fiscal management have been key. So too, it has to be said, has the discovery of diamonds. This industry now accounts for about 25 percent of GDP and 85 percent of export earnings. The Government recognizes that it's not wise to put all of one's eggs in a single basket, and unlike other African nations dependent on natural resources, has resolved to do something about it. Therefore, it was encouraging to note that Finance Minister Kenneth Matambo saw tax base diversification as an urgent matter in his recent Budget address. I hope they succeed.