Botswana new President likely to spur economic growth

His Excellency Mokgweetsi Eric Masisi was inaugurated as Head of State of the Republic of Botswana on the 1st of April 2018. This is after the stepping down of Lt. Gen. Dr Ian Khama following the completion of his constitutional maximum of 10 years in office. The transition of power was very smooth and reaffirms the country as a beacon of democracy and political stability on the continent. The smooth transition of power provides political certainty and stability which is one of the key ingredients for attracting Foreign Direct Investment into the country. It also reaffirms Botswana as one of the handfuls of African nations defined as free democracies by Freedom House, The Economist Intelligence Unit, and is rated as the least corrupt country in Africa by Transparency International.

Bogolo Joy Kenewendo is Investment, Trade and Industry Minister

Botswana has a multiparty system that is dominated by one political party, the Botswana Democratic Party (BDP). Traditionally, the president of Botswana ends his term a year before national elections, ceding power to a vice president who would have been chosen with the express intent that he or she leads the party and country going forward. While Botswana’s fractious opposition parties have made some progress in uniting recently, the ruling BDP is widely expected to win the upcoming 2019 elections, marking the beginning of President Masisi’s first five-year term.

Born 55 years ago, President Masisi is a trained teacher who also worked for the United Nations Children’s Fund. He became an MP in 2009 and served as minister of public affairs in the government in 2011-2014, before Khama made him education minister, and then vice president. He is largely regarded as thoughtful, decisive and enthusiastic about getting things done. The business community regards him as more business-friendly and is widely expected to come up with policies that enable more economic activity to grow the economy which has been expanding at a smaller pace of late. It is not surprising that his presidency has been well received and is expected to bode very well for the markets and the economy in general, particularly with respect to areas such as job creation, economic growth and diversification. Some are however skeptical that the President may not move very far from former president Ian Khama’s socialist policies, especially ahead of the 2019 general elections.

Botswana’s economy has been growing at a slower space over the past few years with rising unemployment which stands at around 18% and is the highest especially among the youth. Botswana’s economy registered a growth rate of 4.3% in 2016, after contracting by 1.7% in 2015. In 2017 the economy is projected to have expanded by 4.7% and is projected to grow by 3.8% in 2018.

President Masisi has already hit the ground running with the appointment of a new vice president, Slumber Tsogwane and the unveiling of a 28 member cabinet which has been well received by the market. One of the sensational highlight is the appointment of 31 year old Bogolo Joy Kenewendo as Investment, Trade and Industry Minister. She becomes Botswana’s youngest ever minister, two years after she was appointed by the former president Ian Khama as a member of parliament. (Motswedi Securities)