Botswana has a developing economy considered upper-middle income. Growth in private sector employment averaged about 10% per annum during the first 30 years of the country's independence. After a period of stagnation at the turn of the 21st century, Botswana's economy registered strong levels of growth, with GDP growth exceeding 6–7% targets. Economic growth since the late 1960s has been on par with some of Asia's largest economies. The government has consistently maintained budget surpluses and has extensive foreign-exchange reserves.

Botswana's relative economic growth compared to some of its neighbors has been built on a foundation of diamond mining, prudent fiscal policies, and a cautious foreign policy. Botswana's economy is mostly dependent on diamond mining. Diamond mining contributes to 50% of the government revenue mainly through its 50:50 joint venture with De Beers in the Debswana Diamond Company. Lab-grown diamonds has led to a significant decrease in worldwide demand for mined diamonds beginning in the early 2020s. The resulting reduction in the value of diamond exports prompted the IMF to forecast Botswana to run a fiscal deficit of 11%, and the Botswana ministry of finance to forecast negative GDP growth for the country in 2025. As of 2020, Botswana is rated as the third least corrupt country in Africa in the Corruption Perceptions Index by international corruption watchdog Transparency International. It has the fourth highest gross national income per capita in purchasing power in Africa and above the world average.

Trade unions represent a minority of workers in the Botswana economy. In general they are loosely organised "in-house" unions, although the Botswana Federation of Trade Unions (BFTU) is consolidating its role as the sole national trade union centre in the country. Botswana's overreliance on mining and its high rate of HIV/AIDS infection (one in every five adults is seropositive) and unemployment may threaten its future success. Botswana has become the first high-burden country to be certified for achieving an important milestone on the path to eliminating mother-to-child transmission of HIV by the World Health Organization (WHO).

History Agriculture still provides a livelihood for 70% of the rural population but supplies only about 50% of food needs and accounted for only 1.8% of GDP as of 2016. Subsistence farming and cattle raising predominate. The sector is plagued by erratic rainfall and poor soils. Diamond mining and tourism are also important to the economy. Substantial mineral deposits were found in the 1970s and the mining sector grew from 25% of GDP in 1980 to 38% in 1998.

Economic growth slowed in 2005–2008 and turned negative in 2009 as a result of the Great Recession, contracting by 5.2%. This was exacerbated by a major global downturn in the industrial sector, which shrank by 30%, Botswana's steep economic downturn contrasted with most other African nations which experienced continued growth through this period.CIA.gov see also :File:GDP Real Growth.svg

Macroeconomic trend

Main indicators The following table shows the main economic indicators in 1980-2026. Inflation below 5% is in green. +YearGDPGDP growth (real)Inflation (%)Government debt (% of GDP)Total (bil. US$ PPP)Per capita (US$ PPP)Total (bil. US$ nominal)19801.9n/a1.212.012.1n/a19854.0n/a1.17.78.1n/a19908.1n/a3.88.811.4n/a199510.9n/a4.88.510.5n/a200014.4n/a5.74.38.58.2200519.9n/a9.85.08.67.5200621.8n/a9.96.011.66.1200723.7n/a10.65.87.15.9200824.9n/a10.73.312.67.8200921.5n/a10.1 -14.18.122.4201024.0n/a12.610.16.926.5201126.2n/a15.16.88.527.9201226.6n/a13.9 -0.27.526.4201330.0n/a14.311.15.923.8201432.3n/a15.55.74.423.9201531.0n/a13.5 -4.93.124.5201633.6n/a15.17.22.822.3201735.6n/a16.14.13.319.6201836.3n/a17.04.23.219.6201937.2n/a16.73.02.721.5202036.1n/a14.9 -8.71.923.5202143.1n/a18.811.96.722.3202248.7n/a20.35.512.221202352.2n/a19.43.25.122.5202451.9n/a19.4 -3.02.833.2202552.9n/a19.5 -0.92.838.6202656.9n/a21.94.75.147

Sectors Agriculture

More than half of Botswana's population lives in rural areas and depends on subsistence crops and livestock farming. Agriculture meets only a small portion of food needs and contributes just 1.8% of Botswana's GDP as of 2017, according to the CIA World Factbook. 2024 estimates stated that it was still less than 2% of Botswana's GDP. Cattle raising dominated Botswana's social and economic life before independence. The Botswana Meat Commission (BMC) has a monopoly on beef production, however in late 2023, it ended. The national herd was about 2.5 million in the mid-1990s, though the 1995 government-ordered slaughter of the entire herd in Botswana's north-west Ngamiland District, to prevent the spread of "cattle lung disease" to other parts of the country, reduced the number by at least 200,000.

Botswana produced, in 2018:

102 thousand tons of root and tubers; 46 thousand tons of vegetables; 17 thousand tons of sorghum; 13 thousand tons of maize; 8 thousand tons of cabbage; 6 thousand tons of onion; 5 thousand tons of tomato;

In addition to smaller productions of other agricultural products.

Mining

Two large mining companies, Debswana (formed by the government and South Africa's De Beers in equal partnership) and Bamangwato Concessions, Ltd. (BCL, also with substantial government equity participation) operate in the country. BCL was placed in provisional liquidation in late 2016, following years of loss-making operations, and was placed into final liquidation by the High Court in June 2017.

Diamonds and other gems Since early 1980s, the country has been one of the world's largest producers of gem diamonds. Eight large diamond mines have opened since Botswana's independence. De Beers prospectors discovered diamonds in northern Botswana in the early 1970s. The first mine began production at Orapa in 1972, followed by a smaller mine at Letlhakane. What has become the single-richest diamond mine in the world opened in Jwaneng in 1982. The mine was discovered when termites looking for water brought grains of diamond to the surface. Botswana produced a total of 24 million carats of diamonds from Debswana in 2022, and is the highest producer of diamonds by value in the world as of 2023. The Orapa 2000 Expansion of the existing Orapa mine was opened in 2000. According to Debswana, the Orapa 2000 Expansion project increase the Orapa's mine annual output from 6 million carats to 12 million carats and raised total production to 26 million carats. In 2003, Debswana opened the Damtshaa diamond mine about 220 kilometers (140 mi) west of the city of Francistown. The mine was placed into care and maintenance in December 2015 due to weak global demand but was scheduled to reopen in January 2018. In 2008, Australia's Kimberley Diamond Company opened a mine in Lerala, Botswana's fifth mine and the first not operated by Debswana. However, Kimberley shut down the mine in May 2017, citing weak market conditions.

Most of Botswana's electricity is imported from South Africa's Eskom. Debswana operates the nearby Morupule Colliery to supply coal to it. Botswana exported $3.12k worth of electricity from 2021 to 2022, all going to Zimbabwe. In early 2008, the entire southern African region was hit hard by massive shortages of power, since the region works to share its power resources through the Southern African Power Pool, with most of its capacity coming from South Africa. Botswana has in turn put in place plans to become a net exporter of power to the regional pool, through governmental expansion of the Morupule power station, as well as encouraging private investment in the form of a 4 gigawatt power station by the Canadian greenfield company CIC Energy. In 2012, CIC Energy was acquired by India's Jindal Steel and Power. Jindal Africa currently aims to operate three surface mines in the coalfields of Mmamabula, as well as a power plant. According to the company, "the mine’s development will meet the demands of 600MW power stations and export region coal markets, with the potential to employ more than 2,000 people."

Botswana also produces soda ash through Botash, a joint venture between the government and South Africa's Chlor-Alkali Holdings (CAH) Group. Botash has been operating in the Sua Pan in northeastern Botswana since April 1991.

Tourism

Tourism is an increasingly important industry in Botswana, accounting for approximately 13.1% of GDP in 2019. However, , it was reported to be less than 10%. One of the world's unique ecosystems, the Okavango Delta, is located in Botswana. The country offers game viewing and birding both in the Delta and in the Chobe National Park—home to one of the largest herds of free-ranging elephants in the world. Botswana's Central Kalahari Game Reserve also offers game viewing and some of the remotest and most unspoiled wilderness in southern Africa.

A number of national parks and game reserves, with their abundant wildlife and wetlands, are major tourist attractions.

The main safari destinations for tourism are Moremi Game Reserve in the Okavango Delta, and Chobe National Park. Botswana is also participating in community-based natural resource management projects by trying to involve villagers in tourism. One example is the village of Khwai and its Khwai Development Trust.

Botswana was the setting for the 1980 movie The Gods Must Be Crazy, although the movie was mostly filmed in South Africa. The seventh season of The Amazing Race visited Botswana. Tourism has been stimulated by the series of detective novels by Alexander McCall Smith and the American dramatisation that followed them.

Manufacturing

Manufacturing industries in Botswana include food processing, predominantly beef processing, diamond processing, textile and garment manufacturing, beverage making, jewellery making, metals and metal products, soap making, construction materials manufacturing, and glass production.

Manufacturing has potential growth, however, accounting for roughly 5% of the nation's gross domestic product. Over the years, there has been a notable decline in the role of the manufacturing sector in the national economy. The reason for this can be pinned to a number of factors, the main ones being lack of skills, failing to keep up with the latest technology, lack of competitiveness along with bad marketing techniques.

Science and technology

There is a growing science sector in Botswana. The number of publications by Botswanan scientists catalogued in international databases increased from 133 in 2009 to 210 in 2014. In 2018, Botswana produced 281 scientific and technical journal articles. The country has one of the highest levels of scientific productivity in Sub-Saharan Africa. The country also has a high-tech industry, being home to a number of information technology companies. In 2022, Botswana's high-tech exports were worth about $38 million.

Transport

Financial sector Botswana has a growing financial sector, and the country's national stock market, the Botswana Stock Exchange (BSE), based in Gaborone, is given the responsibility to operate and regulate the equities and fixed interest securities market. Formally established in 1989, the BSE continues to be pivotal to Botswana's financial system, and in particular the capital market, as an avenue on which government, quasi-government and the private sector can raise debt and equity capital. Although the BSE has just under 40 companies listed, it plays host to the most pre-eminent companies doing business in Botswana. These companies represent a spectrum of industries and commerce, from Banking and financial services to Wholesaling and Retailing, Tourism and Information Technology.