IMF revises Botswana’s 2017 economic growth forecast as diamond demand rises

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(FILES): This April 5, 2007 file photo shows the International Monetary Fund logo at IMF headquarters on Pennsylvania Avenue in Washington, DC. The IMF announced November 2, 2009 the sale of 200 tonnes of gold to India's central bank, nearly half the amount targeted for sale over the coming years to shore up IMF finances. The total sales proceeds are equivalent to 6.7 billion dollars, the IMF said. AFP PHOTO / Files / TIM SLOAN (Photo credit should read TIM SLOAN/AFP/Getty Images)

GABORONE – The International Monetary Fund (IMF) has revised Botswana’s 2017 and 2018 economic growth forecast due to rising diamond demand, investment in the water and power sector and reforms to attract investment.

The IMF on Wednesday lifted diamond-producer’s 2017 and 2018 economic growth forecast to 4.5 and 4.8 percent respectively.

“The forecast assumes a gradual pace of reforms to improve the efficiency of the public sector and foster private sector activities,” the IMF said.

Following a downturn in 2015, growth is expected to gradually increase supported by a recovery in the diamond market and moderate fiscal stimulus, the IMF said in the report.

The latest forecast is higher than the IMF’s previous forecast for Botswana contained in its Africa regional economic outlook report released in April, which forecast growth at 4.1 percent in 2017 and 4.2 percent in 2018.

The IMF’s growth projection is more bullish than government forecasts. Finance Minister Kenneth Matambo said in February during the national budget presentation that the local economy was expected to grow by 4.2 percent this year.

Writing by Tanisha Heiberg; Editing by James Macharia

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