REASONS WHY YOU SHOULD INVEST IN BOTSWANA
The way we talk about Africa these days has shifted from a traditional conversation that focuses on “deficits” and “gaps” and “crises” to one that is about opportunities, prospects, ventures and creativity. It is important to realize there is money to be made on the continent for those bold enough to help close those gaps. It is also worth acknowledge that while most African countries test the patience of any investor, there are a handful of countries that continue to pleasantly surprise you, and Botswana is one of them.
Let’s dive straight into some real and “non-flavoured” facts and figures about why you should invest in Botswana:
THE RIGHT ENVIRONMENT TO DO BUSINESS
At the core of running a successful business is the existence of a conducive environment. But let’s face it: this can get tricky on the African continent.
Luckily, Botswana is a regional leader in economic, personal and political freedom, which means that the country welcomes foreign investment and trade, to such an extent that it has become the world’s benchmark in economic development. This is evidenced by the fact that Botswana has earned the highest sovereign credit rating in Africa in recent years, thanks to its well-regulated, transparent and investor friendly business environment, which stands in stark contrast which is some of its neighbours, who currently seem to be travelling full speed in the wrong direction.
Some other advantages of investing in Botswana includes:
- No foreign exchange controls, which allows for remittance and full repatriation of profits and dividends
- No restrictions on business ownership
- Imported machinery and equipment, as well as raw materials for manufacturing for export are exempt from import taxes and customs duty
- Botswana has a deductible 200% rebate on manpower training for investing firms
- There is a liberal tax regime, with 22% corporate and 25% personal tax, with 15% corporate tax for manufacturing and IFSC-registered companies, which are the lowest taxes in the SADC region
- And, of course, Botswana is the doorway to SADCOverall, Botswana is rated as a fundamentally stable and democratic country, which goes a long, long way when you have to decide where to put your investment or to do business.
Ranked number 3 in region Sub-Saharan Africa in the Ease of Doing Business report, Botswana has managed to slash the amount of time needed to import and export goods by nearly a week! Even more, business startup procedures have been streamlined and the government of Botswana has been systematically upgrading the technological backbone of its government departments. One direct consequence of this drive to modernize are tech upgrades in the court system, which have sped up the resolution of commercial disputes and have reduced the length of the average court case from 987 days in 2008 to 625 today. It is also worth mentioning that Botswana is ranked number one in Africa on Transparency International’s anti-corruption index, which means that it is literally at the top of the list for its absence of corruption. To make a good thing even better, Botswana also received third place for ‘best governance’ in 2014 and second place in 2017, which was rated by the Mo Ibrahim Index of good governance.
Overall, Botswana is rated as a fundamentally stable and democratic country, which goes a long, long way when you have to decide where to put your investment or to do business.
THE NUMBERS DO NOT LIE
Diversifying is no simple task for any nation. Botswana’s national economy has historically relied heavily on its diamond mining industry. Still, despite the recent downturn in the international diamond market and the relatively small domestic market, the Botswana economy is not under any great deal of stress. This is at least partially thanks to the fact that the government has taken a long-term view to drive the economy forward, through the building of an entrepreneurial economy.
This ambitious Vision 2036 has led the transformation of Botswana from one of the world’s poorest and least-developed countries into an upper-middle income economy that has seen an average growth of 8.2% since independence in 1966 to 2015 – which is a performance only out-paced by China’s 9.3%. Vision 2036 place people at the heart of industrial growth. This effort to focus on the intellectual and social wealth of the country translates into more directed investment into education and citizen empowerment, to ensure that the country becomes competitive globally in innovation.
The truth is that Botswana reached middle-income status by consuming, investing wisely and the proceeds from its abundant natural resources; which is why the focus now of vision 2036 is to increase productivity, competitiveness and economic efficiency.
It is prudent to mention, however, that while huge achievements have been made, Botswana still has a few challenges to deal with. One issue that still haunts the country is the problem of youth unemployment, which now stands at 20% of its two million citizens, as well as continent-wide problems of HIV/Aids, poverty and income inequality.
In a nutshell, while Botswana still has to deal with all the problems that are endemic to Africa, it is also a country with a strong long-term plan and people and government that is committed to succes. It is also a country where technological, social and economic progress have taken off like a rocket. It is a hopeful sight to visit a country that is actively working on making a better future for its citizens, who believe that you should strive for something better, and that governments exist to help the people reach greater heights of personal and economic development. Botswana’s progressive vision for the future has been responsible for the creation of a stable and inviting society, which is being recognized by more and more international investors as the gateway to Southern Africa – making Botswana a natural place to lay down your business roots.