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GDP grew by 4.4% in 2014

Water, Electricity sector slows down economy

Botswana’s Gross Domestic Product (GDP) grew by 5.3% in q4 2014 according to data from Statistics Botswana. The slower than expected growth was mainly led by decline in growth from the mining sector which is the largest contributor to the economy – analysts at Motswedi Securities have observed.

According to a Motswedi Securities quarterly economic bulletin, the mining sector posted a 2.5% growth as compared to 10.4% registered the previous quarter. The same report reveals that the Trade, Hotels & Restaurants sector which is the 2nd largest contributor grew by 7.8% while the Finance & Business Service sector advanced by 5%, slower than the revised 7.8% posted in the previous quarter.

“On a different note, The Water & Electricity sector which has been dragging economic growth, suffered a -236.4% the lowest figure during the year 2014. For the year 2014, GDP growth was 4.4% relatively lower than the 9.3% (revised) recorded in 2013 despite the stronger performance from the Jwaneng mines during q3; where higher grade carats were produced.

This slower growth was also attributable to the Water & Electricity sector which registered the only negative growth (of -18.5%) during 2014. The Trade, Hotels & Restaurant posted the 2nd largest growth of 7.1% reflecting the resilience of some of the developed economies such as the US,” reads the Motswedi securities economic brief.

Going forward, analysts at Motswedi Securities anticipate volatility from the Mining sector which remains subjective to developments on the international markets, mainly the health of the US economy and some of the developed economies. Eurozone recently initiated a stimulus program in order to propel the 19 nation economy.

“We remain concerned about the persisting Greece crisis which has stoked fears about a potential default and ultimately withdrawal from the Eurozone as this could pose a threat to our diamond sales. Meanwhile Chinese growth has been fragile with recent GDP figures coming short of expectations. We could see the People Bank of China heading the direction of starting a quantitative easing scheme in order to steer growth.”

However, Motswedi Securities analysts emphasise that the Water and Electricity sector remain a major concern as power and water supply particularly in Gaborone, the capital city remain a challenge within the country.

“The central bank recently reduced the bank rate by 100 basis points to 6.5% in line with the downtrend of our inflation. We expect the lower rate to boost economic growth and driving the Finance & Business Services sector which contributes the 4th largest weight to Botswana GDP,” concludes the report.

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China’s GDP expands 3% in 2022 despite various pressures

2nd February 2023
China’s Gross Domestic Product (GDP) expanded by 3% year-on-year to 121.02 trillion yuan ($17.93 trillion) in 2022 despite being mired in various growth pressures, according to data from the National Bureau Statistics.

The annual growth rate beat a median economist forecast of 2.8% as polled by Reuters. The country’s fourth-quarter GDP growth of 2.9% also surpassed expectations for a 1.8% increase.

In 2022, the Chinese economy encountered more difficulties and challenges than was expected amid a complex domestic and international situation. However, NBS said economic growth stabilized after various measures were taken to shore up growth.

Industrial output rose 3.6% in 2022 over the previous year, while retail sales slightly shrank by 0.2% data show that fixed-asset investment increased 5.1% over 2021, with a 9.1% hike in manufacturing investment but a 10% fall in property investment.

China created 12.06 million new jobs in urban regions throughout the year, surpassing its annual target of 11 million, and officials have stressed the importance of continuing an employment-first policy in 2023.

Meanwhile, China tourism market is a step closer to robust recovery. Tourism operators are in high spirits because the market saw a good chance of a robust recovery during the Spring Festival holiday amid relaxed COVID-19 travel policies.

On January 27, the last day of the seven-day break, the Ministry of Culture and Tourism published an encouraging performance report of the tourism market. It said that domestic destinations and attractions received 308 million visits, up 23.1% year-on-year. The number is roughly 88.6% of that in 2019, they year before the pandemic hit.

According to the report, tourism-related revenue generated during the seven-day period was about 375.8 billion yuan ($55.41 billion), a year-on-year rise of 30%. The revenue was about 73% of that in 2019, the Ministry said.

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Jewellery manufacturing plant to create over 100 jobs

30th January 2023

The state of the art jewellery manufacturing plant that has been set up by international diamond and cutting company, KGK Diamonds Botswana will create over 100 jobs, of which 89 percent will be localized.

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Investors inject capital into Tsodilo Resources Company

25th January 2023

Local diamond and metal exploration company Tsodilo Resources Limited has negotiated a non-brokered private placement of 2,200, 914 units of the company at a price per unit of 0.20 US Dollars, which will provide gross proceeds to the company in the amount of C$440, 188. 20.

According to a statement from the group, proceeds from the private placement will be used for the betterment of the Xaudum iron formation project in Botswana and general corporate purposes.

The statement says every unit of the company will consist of a common share in the capital of the company and one Common Share purchase warrant of the company.

Each warrant will enable a holder to make a single purchase for the period of 24 months at an amount of $0.20. As per regularity requirements, the group indicates that the common shares and warrants will be subject to a four month plus a day hold period from date of closure.

Tsodilo is exempt from the formal valuation and minority shareholder approval requirements. This is for the reason that the fair market value of the private placement, insofar as it involves the director, is not more than 25% of the company’s market capitalization.

Tsodilo Resources Limited is an international diamond and metals exploration company engaged in the search for economic diamond and metal deposits at its Bosoto Limited and Gcwihaba Resources projects in Botswana.  The company has a 100% stake in Bosoto which holds the BK16 kimberlite project in the Orapa Kimberlite Field (OKF) in Botswana.

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