“Our success is based on strict adherence to the fundamentals of good governance”
President of the Republic of Botswana since 2018, Mokgweetsi Masisi was one of the stars of the United States – Africa business summit which took place in Marrakech from July 18 to 21, 2022. At the head of the only African investment grade country ( A3 with Moody’s and BBB+ with S&P Global Ratings), this professor of social sciences has been able to maintain his country’s good reputation with foreign investors and the financial market in general by continuing in the tradition of administrative transparency initiated by his predecessors and by successfully convincing players in the diamond and mining sector in general to invest in local processing. A country with a literacy rate of over 80%, Botswana is a textbook case in terms of preserving macroeconomic balances, redistributing revenues from the extractive industry through a sovereign fund, the Pula Fund, founded in 1993, which today has reserves equivalent to 10% of GDP and which guarantees the stability of the national currency and, ultimately, the social protection of this neighboring country of South Africa. Exclusive.
How can the success story of Botswana, at the top of the table of the most rated countries in Africa for a long time, be explained?
Our success is based primarily on strict compliance with the fundamentals of good governance. The second point is a close partnership with the private sector in PPP projects or in strictly private projects. There is also the predictability of our reforms and our commitments. All of this obviously rests on political stability and the rule of law. Secondly, there are our incentive policies for the benefit of investors. They can repatriate their profits and even the capital invested without constraint, at any time and in the currency of their choice. There are no exchange controls in Botswana.
How do you manage to create value in the mineral resources sector?
We do this primarily through regulation and by ensuring that mining is done with strict respect for the environment and communities. Our mining reforms and policies are conducted with the aim of optimizing the value chain. In the diamond sector, Botswana is known to be an important member of the Kimberley Process. It is the choice of transparency and traceability. The rigorous and transparent management of this strategic sector allows us to increase its value and its contribution to the economy.
In Marrakech, you was one of the stars of the business summit between the United States and Africa. What is the state of your relations with the USA?
The United States is an essential partner for Botswana. It is our first export market for our diamonds. With the updating of our reforms and a good dissemination of the advantages that we grant to partners, we can increase our exports to this country. In addition to the incentives offered, we have a relatively stable currency (Editor’s note: 1 dollar USD = 12.64 Pula BWP) which reduces the exchange risk. The other strong argument in our favor is the integrity of our diamond company certified on the American market and which has processes that meet the highest requirements of the international market.
According to Moody’s and Standard and Poor’s, you are the least risky country in Africa. Is this still the case ?
I cannot say more than those rating agencies that base their opinions on measurable parameters, data analysis and investor surveys. As I told you earlier, our success with these agencies and the business community around the world is based on good management and transparency. I invite you to come and review our fundamentals, observe and evaluate and I assure you that you will realize it.
Last question, Mr. President , how do you feel about the Continental Free Trade Area (ZLECA)?
We are committed to it and are convinced of its relevance. We must engage fully in reforms, tariff and non-tariff negotiations. In addition, we must step up the pace of investment in road, rail, port and airport logistics to facilitate trade with our different economies.
