Botswana: An African Success Story
Foreword
Botswana obtained independence in 1966, after eighty years as the Bechuanaland Protectorate, under British colonial rule. The country is renowned today as an “African success story” globally (Acemoglu et al., 2001), and its success is largely based on efficient politics and management. The policies implemented when the country first gained independence by the first elected president, Seretse Khama, and his government, were strongly aimed at building a state that would be economically and politically independent, both in its administration and trade. Indeed, such a tendency appeared necessary in the struggle to overcome a strong stigma arising from widespread international pessimism toward the country's performance. Documents such as the Development Report, produced in 1965 by the British Ministry of Overseas Development show this tendency, predicting that the new government of Botswana would be dependent on annual foreign financial subsidies for the “foreseeable future,” an element upon which various international analysts agreed (Samatar, 1999). In spite of this widespread pessimism, within a decade of independence, the country's extraordinary growth was already evident, with records showing an increase in revenue from taxation in 1976 equal to eight times that reported in 1966. The discovery of diamond deposits in 1967 was a fundamental driver for an unforeseen growth in the country's economy. This was in spite of the fact that Botswana, around the mid-1960s, was among the twenty poorest countries in the world, with a per capita income of about 80 U.S. dollars a year (Colclough, McCarthy, 1980). Consequently, the country’s government was initially unable to pursue an independent macroeconomic policy, due to still being strongly linked to South Africa (Lewis, Sharpley, 1988). Contrary to all predictions, Botswana’s economy grew at an extraordinary annual rate of 13%. In the words of economists Daron Acemoglu, Simon Johnson and James Robinson (2001, 4):
"There is almost complete consensus that Botswana achieved rapid growth because it managed to adopt good policies. The diamonds no doubt helped in the rapid growth. Yet, it is striking that, contrary to other African countries with abundant natural resources such as Angola, Congo, Sierra Leone or Nigeria, there were no civil wars or intense infighting to control the revenues from diamonds in Botswana […] Therefore, in Botswana good economics appears to have been good politics."
This article will analyze the trends and policies that drove Botswana's growth and made it the renowned success it is today, focusing on the importance of mining and international trade agreements, as well as the efficiency in creating stable structures that sustained Botswana's growth in the long term.
Growth and Political Economy
A number of concomitant factors initiated a prodigious growth process in Botswana. Among these, Charles Harvey and Stephen Lewis Jr. (1990) identify the end of a period of severe drought around the mid-1960s, the state's access to the European common market for the meat trade, the renegotiation of the Southern African Customs Union Agreement (SACU), increasing aid flow from various donor partners, and, of course, the discovery of diamond, copper, and nickel, and the subsequent development of mines. Upon gaining independence, Khama’s Botswana Democratic Party initiated a series of macroeconomic policies strongly aimed at creating fixed revenues that would provide a basis for achieving financial independence. Among the first initiatives, in addition to the aforementioned renegotiation of revenues under SACU (Lewis, Sharpley, 1988) was the implementation of development plans, starting with the 1966 Transitional Plan that was to be the basis for the first economic phase. Specifically, the plan deployed a path for economic and social development for an initial three-year period until 1969, while stressing the necessity of a planned economy (Harvey, Lewis, 1990).
At the same time, efforts were made to consolidate multilateral trade relations with other states in Southern Africa. In particular, a free trade agreement was established with Zimbabwe, whose imports came to make up 8% of Botswana's total revenue in the mid-1980s, following some periods of instability in their bilateral relations (Lewis, Sharpley, 1988). Efforts were also made to strengthen economic relations with Lesotho and Swaziland, with a trade alliance established in 1969, that later became the SADC (Southern African Development Community), in which Botswana played a de facto predominant role (Harvey, Lewis, 1990). The aforementioned discovery of major diamond sites around the late 1960s, along with copper and nickel resources, was crucial, with mines being established in the areas of Orapa, Letlhakane, and Jwaneng, respectively, and a few years later in Selebi-Phiwke. Works began in Orapa in 1971 and proved profitable from the beginning, under the joint management of the group De Beers and Botswana’s government from 1975. The same joint management would later be extended to the Letlhakane and Jwaneng mines. Indeed, the country’s government formed a joint venture with the De Beers, sharing an equal 50% division of profits, and became known as Debswana Diamond Company Ltd. in 1978 (Hillbom, Bolt, 2918). Mining activities at Selebi-Phiwke, however, did not begin until 1975, and were long subject to various difficulties (Colclough, McCarthy, 1980). The project, which became known as the Shashe Project, underwent a critical phase due to high pollution. Managing to survive its initial crisis, the project turned out to represent the largest private employment sector in the country, and was the only nickel mine in the Western world to operate at full capacity between the 1970s and 1980s. Its construction also had a major impact on the development of the country's industry in the early 1970s, given the huge amount of capital employed in it. A notable consequence of the Shashe Project was the opening of the Morupole coal mine, designed for local power generation. Another associated element was the continuation of a branch line of the primary railway to improve the connection with Moropule: this, in turn, supplied the town with smelters, triggering a virtuous circle (Harvey, Lewis, 1990). There were certainly profound differences in management and profits from diamonds, copper and nickel, but the economic potential of mining was a key contributor to the state treasury: revenues from taxation and exports were exceptional. The legislation regulating the management of the industry fell under the Mines and Minerals Act of 1976, which required holders of mining exploration licenses to carry out work in agreement with the country's government, and to incur certain minimum annual expenses. After a maximum period of seven years, the prospecting company was obliged to apply for a mining license or relinquish all rights to the area, and no license could be renewed after an operating period over twenty-five years, except in the case of specific renegotiations with the government. A Petroleum Act was added to the 1976 measure in 1981, following the second oil shock of 1979. It specifically regulated the legislative framework within which to enter into agreements that included oil exploration, extraction, or trade. This kind of division of shares in the sector meant that it was mainly foreign investors who financed the scheme, even in times of economic downturn, an element that was crucial during the initial phase of building the country's economy, and would become even more so during the periods of crisis in the mining market in the 1980s.
One cannot fail to mention the extraordinary economic phase experienced by the minerals market, and in particular diamonds, since the late 1960s. Botswana was able to sell the entire proceeds from diamond mines every year from the start of mining in Orapa, with overall difficulties reported only in 1974 and 1975. The years between 1981 and 1986, on the other hand, saw the worst period of depression in the international mining market, with a significant increase in the stockpiling of unsold diamonds, which was nevertheless supported by good domestic financial policies (Harvey, Lewis, 1990). However, government policies on mining management placed Botswana in a position of being dependent on various multinational groups, as well as on external structural elements, such as the Southern Rhodesia Railway operated through Botswana territory. The region was subject to continual instability, and thus unable to guarantee continuity of service, an element that was used to criticize Khama’s government until the completion of the in-country railway line around 1976, the terminus post quem for Botswana's changing political relationship with the South Rhodesian regime (Colclough, McCarthy, 1980). The participation of various international actors, private and non-private, in financing extraction in Botswana can perhaps be seen as illustrative of the country's macroeconomic policy, given peaks of 30 to 40% incidence of foreign investment in the state's GDP in some years. Indeed, since independence, the country has made the implementation of the private sector central to its objectives, specifically in areas related to enterprise and manufacturing (Lewis, Sharpley, 1988). Alongside other financial choices, the Republic's government established a Central Bank in 1975 and adopted its own currency, the Pula, the following year. The introduction of the latter did not harm the country’s market competitiveness according to Lewis Jr. and Sharpley (1988). Moreover, according to recent research conducted for the Botswana Institute for Development Policy Analysis - a nongovernmental policy research institution - the currency has experienced stability since the beginning of the 21st century (Taye, 2012). Some analysts have identified in these, as in other financial choices, the country's desire to cut ties with the South African regime, openly criticized by Khama for the institution of apartheid (Colclough, McCarthy, 1988). A key element of Botswana’s financial policies was the lauded management of financial surplus, whereby a Public Debt Service Fund was created to serve as the basis for business lending and as support in times of crisis. The management of this fund is widely assessed as forward-looking and highly functional. Indeed, it is estimated that in 1984, Botswana had the highest absolute level of foreign exchange resources in Sub-Saharan Africa, with the sole exception of Nigeria, and that the level was even higher when considered on a per capita basis (Harvey, Lewis, 1990).
As far as direct government intervention in the economy is concerned, it can be said that this was mainly concentrated in financing infrastructure, at least in the first phase following independence. Harvey and Lewis Jr's analysis (1990) highlighted the virtuous circle initiated by the rapid growth in demand from the mining sector. Their research consulted data on expenditures which show how government action seemed to focus entirely on the construction of road networks and urban infrastructure. This element emerged in some contemporary critiques and led the two scholars to question whether Botswana’s rapid progress was ever overdone. In fact, the agricultural, mining, trade, and manufacturing sectors were entirely run by private individuals, with direct government participation or loans. Specifically, in the agricultural sector, action was entirely reserved for three semi-governmental institutions: the main one, the Botswana Meat Commission (BMC), was particularly successful in the management and marketing of meat, in which it has a substantial monopoly to this day. The other two bodies engaged in the administration of the country's agriculture were the Botswana Agricultural Marketing Board (BAMB) and the Botswana Development Corporation (BDC). The BAMB was responsible for the management and sale of some agricultural products. Meanwhile, the BDC was formed in 1970, for the purpose of controlling the development of agricultural property and housing services for those employed in the sector. Despite the substantial lack of state investment in the agricultural sector, it is crucial to mention the role played by the Botswana Democratic Party in defending Batswana's livestock and agricultural export rights, given a general involvement of the party members themselves in livestock ownership (Harvey, Lewis, 1990). The direction of Botswana's economic policies would change only in the second post-independence phase, beginning in the second half of the 1970s, when there was a new emphasis on the private sector and labor policies. Examples include the introduction of a Local Preference Scheme for local manufacturers selling to the government in 1976, and the creation of a financial assistance program aimed at new or expanding businesses or companies in 1982. The tax system was maintained in a form similar to that inherited from the Protectorate, thus formulated on the English model, and was slightly modified, again in the mid-1970s, with tax relief policies for poverty and large enterprises (Harvey, Lewis, 1990).
Internal, International and Social Policies
During the colonial period, the British administration had cultivated a direct relationship with the traditional chiefs, and their power had grown as a result. This element has been the subject of various criticisms in political and academic circles for its typically ethnocentric character and profound misunderstanding of other structures. In a thorough analysis, in fact, the power of the kgosi (chief) cannot be considered absolute, but is merely judicial and executive in nature, while it is the kgotla assembly (popular local assembly) that guides and deliberates on the political choices to be made. The power of the dikgosi (chiefs) was severely limited in the aftermath of independence: institutionalized in the House of Chiefs, with legislative power and consultative function, the position of the dikgosi was regulated by the Chieftanship Act of 1965. The Act, which had been pushed for by the BDP, regulated the election and removal of merafe chiefs (traditional political unity typical in Tswana society). In 1965, a Local Government Bill was issued, declaring them state employees and defining their powers and functions (Colclough, McCarthy, 1980). The position of the dikgosi was also changed, together with livestock management policies, previously a central element of each kgosi’s power. The Tribal Grazing Land Policy of 1975 reduced the number of livestock on the merafe's communal lands in favor of enhanced industrial meat production (Tlou, Campbell, 1984). The BDP's policies on livestock management were also changed. The housing policies pursued by the BDP always remained “socialist” in nature, with the establishment of measures that provided the people of Botswana with the right to apply for a plot of land for a house and to start a farming or pastoral activity. However, obtaining the land was highly regulated and came with stringent charges (Harvey, Lewis, 1990). In contrast again to the dikgosi, the central government's efforts were focused on creating new ministerial and administrative structures committed to modernizing the country and orienting it toward a policy of sustained development. Lastly, in the international sphere, despite its proximity to the British sphere, Botswana immediately joined the Organization of African Unity (OAU). The country also conformed to the general political line of non-alignment regarding the Cold War, continuously pursuing the policy of opposing the South African regime (Tlou, Campbell, 1984).
In terms of internal politics, there was a strong commitment to the country's educational system. The initial focus was precisely aimed at creating a ruling class, with major investments in the primary, secondary, and higher education sectors. Notable examples include the investment made in the construction of a secondary school at Swaneng Hill in Serowe. Following in the footsteps of a fairly widespread process in the newly independent countries of Sub-Saharan Africa, investments were made in technical education specifically (Tlou, Campbell, 1984). This was the first time the country had invested in this field. According to the statistics, in 1955 there were fewer than 500 students enrolled in the final year of elementary school (Standard 7), and only 50 to 60% of these managed to pass the final examination. Following independence, there was significant growth in education figures, mainly on the basis of major investments in the sector. After 1966, elementary school enrolment tripled, and the number of students attending Standard 7 grew tenfold. During the same period, more than half of the children in the age group corresponding to elementary school were enrolled there, compared to 37% of children in schools in other low-income countries in Sub-Saharan Africa (Harvey, Lewis, 1990). The number of children attending Standard 7 grew by a factor of ten. Thus, the situation in contemporary Botswana has been described in terms of mass education, where the number of enrolees in the country's education system grew fivefold between 1966 and the early 1990s (Meyer, 1993). Despite this, the general lack of secondary schools in the country, present in smaller numbers than the standards recorded in Sub-Saharan Africa as late as 1975, has been widely highlighted (Whitesaid, 1984). The great effort put into improving the quality of secondary and tertiary education, however, has resulted in a huge increase in costs and a parallel deterioration in primary education services. Given the obvious need for an educational reform, the work of a number of commissions set up by the government brought forward various proposals for renewal. These involved a general increase in practical and manual education and an increase in the teaching of Setswana language and culture, in parallel with the diversification and improvement of educational programs overall (Colclough, McCarthy, 1988).
The government's efforts to improve the quality of education were also successful. However, there were shortcomings in the management of some aspects, as in the case of the education of people with disabilities, which was left in the hands of nongovernmental organizations for many years. In fact, this issue was not directly addressed until 1984, when the Ministry of Education introduced a Special Education Unit with the task of coordinating specific educational plans; notably, this entailed a greater commitment to the development of more inclusive education (Abosi, 2000). The aforementioned boost given to the Setswana language since independence in the country's education and bureaucracy still has important effects to this day. Indeed, official statistics record that the Setswana language is spoken by circa 98% of the population, despite the fact that the official language remains English (Mitchell et al, 1989). This element seems partially at odds with other African states, in that, in the period following the end of colonization, they retained only the language of their colonizers. In spite of this, writings on the subject express a number of criticisms about the lack of total ethnic-linguistic uniformity in the country, with Eureka Baneka Mokibelo claiming that Setswana language education would discriminate against a large number of non-Tswana students (Mokibelo, 2014). The fact that the Setswana language is not the official language of the country is also a critical issue. Finally, it is relevant to point out that, despite the state's commitment to the educational sector, in contrast to many other African countries in the same years, primary education was not made free until 1980, an element that evidently entailed a number of limitations in access to education (Tlou, Campbell, 1984).
With regard to health, the aftermath of independence saw increasing efforts to invest in the construction of primary health and hospital facilities, mainly in rural areas. A widespread policy of training hospital staff was pursued, with the establishment of scholarships for medical training abroad, and the creation of the National Health Institute specifically for nursing education. The formulation of a national plan for family education with respect to protection and prevention from major infectious diseases was also of relevant importance (Tlou, Campbell, 1984). Although investment in this sector was lower overall than in education, improvements were evident. Botswana had, in 1965, one doctor for every 26,000 inhabitants, a figure that shows a better scenario compared to the average of Sub-Saharan African countries: one doctor for every 39,000 inhabitants. However, it is crucial to assess the country's low population density when approaching these figures. The 1983 report produced by the Central Statistics Office in Gaborone shows, relative to the years 1980/81, a remarkable growth in attendance at outpatient centers, thanks to the aforementioned state investment in the creation of health garrisons scattered throughout the territory, especially in rural areas. A report compiled in 1983 highlighted that more than 90% of the population had access to public health care in the early 1980s, thanks to the work of mobile clinics. A sudden consequence of these developments was a considerable increase in life expectancy, as part of a growing commitment to health care, with substantial investment in the sector (Central Statistics Office, 1983).
It has already been mentioned that Botswana, at the time of independence, had little prospect for economic development, due to a number of structural problems and a per capita income that was among the lowest in the world (Colclough, McCarthy, 1984). Despite all predictions, the country's growth was extraordinary: suffice it to say that within four years of independence, the pace of growth in the state had already doubled, and that for the five years from 1968/9 to 1973/4 the growth rate was 20%. At the same time, the real value of domestic production doubled between 1965 and 1970, almost doubling again in 1974. While in the years 1965 to 1969, the Republic's economy was dominated by a staggering increase in agricultural production, the mining sector later became the leader in driving the state's economy, recording an increase in the value of production from 1 million Pula in 1968/9 to 16 million five years later, mainly due to the opening of the Orapa diamond mine. The same value increased again to 34 million Pula in 1975/6. At the same rate, the value of trade and manufacturing grew by 30% (Colclough, McCarthy, 1984). In Colclough and McCarthy's analysis, they point out that "although mining output was still only a comparatively small contributor to the total value of domestic production in 1975/6, the developments in this sector can be considered to have led the economy since the late 1960s” (Colclough, McCarthy, 1984, 65). The authors argue that the growth of new revenue would have been the most radical financial feature in the country's history, an element on which general agreement can be found in the literature (Colclough, McCarthy, 1984).
Concluding remarks
The picture of the state economy emerging in the mid-1980s is therefore totally different from the situation recorded in 1966. The country's GDP corresponded, in 1986, to 1.316 million Pula, eleven times the value estimated for 1960. GDP per capita grew, in the same period, from 191 Pula to 1144 (Harvey, Lewis, 1990). It was then a matter of building an educational system in the country: following independence, there was also significant growth in the sector, mainly on the basis of the major investments brought forward. As a result, this established a mass education system that still exists today (Meyer, 1993). Despite a performance generally considered less than excellent, especially when analyzed in comparative perspective, the Botswana Democratic Party and Seretse Khama’s government have paid much attention to, and made many investments in the country's education system. However, as article has pointed out, there is no shortage of elements in need of amendment: the management of some aspects is deficient, as in the cases cited of the education of people with disabilities and the exclusion of minority ethnic groups.
Finally, the state's healthcare system was discussed. Investment in this sector is lower overall than in education, but the decisive improvement in the health situation compared to the management of the protectorate is undeniable. It was highlighted that more than 90% of the population had access to public health care in the early 1980s, and that the effects of these policies were evident. The overall development of the independent Botswana has led authors to speak of it in terms of the "African Miracle". Indeed, the country's economy grew at an annual rate of 13% in the 1980s and, in the first four decades since independence, had the highest long-term growth rates in the world, surpassing the renowned Asian Tigers (Hillbom, Bolt, 2018).
Bibliography
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Visual References
Cover image: Tshabu, K. (2020). Two Women Gathering Wild Barries [Artwork]. Kuru Art Project. https://yourbotswana.com/kuru-art-project/#gallery-20.
Figure 1: Khax'a, Q. (2022). Dxao, Korhaan & Gemsbok. [Artwork]. Kuru Art Project. https://yourbotswana.com/kuru-art-project/#gallery-32.
Figure 2: Ntcox'o, T. (2022). Nxae & Ntcono. [Artwork]. Kuru Art Project. https://yourbotswana.com/kuru-art-project/#gallery-26.
Figure 3: Cao, Q. (2022). Tchaba, Q'aru & Cgui Plants & Birds. [Artwork]. Kuru Art Project. https://yourbotswana.com/kuru-art-project/#gallery-29.
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