Botswana, the diamond rich country, continues to purchase more goods from South Africa, the region’s economic powerhouse which experienced economic and political challenges in recent years.
According to data obtained by Botswana Guardian from Statistics Botswana, the landlocked-country received goods worth of P1, 89 billion during the month of March 2017.
Food, beverages, tobacco and fuel are the leading goods which entered Botswana from South Africa during the period under review.
In total goods worth P4, 29 billion found their way into Botswana during the period under review. Foodstuffs totaling P371, 5 million were bought by locals from the country in March, it has been revealed. For the period under discussion, P317 million was paid for the acquisition of beverages of various sorts from South Africa, a country which is also Africa’s most advanced economy.
Following the downgrading of South Africa’s economy to a junk status by S&P Global a few months ago, economists fear the trade dynamics between the two Southern African countries might change on the backdrop of poor economic performance in South Africa.However, some analysts have pointed it is early days, but Bank of Botswana (BoB) has already flicked red lights. “Regionally, the recent downgrade of South Africa’s credit rating, for foreign currency debt, to sub investment grade could undermine growth by constraining private investment and household consumption. Potential negative spillovers into Botswana include higher inflation, lower exports and SACU revenue, although the risks are considered to be moderate, overall,” said Governor Moses Pelaelo.
He was reading a statement to the media after the central bank’s Monetary Policy Committee (MPC) kept the lending rate at 5,5 percent in June. Meanwhile, Asia, the world’s largest and populous continent comes second to South Africa as far as imports are concerned.
For the period under discussion, goods worth P1, 56 billion came from the region. The European Union (EU) supplied imports valued at P324.4 million, accounting for 7.6 percent of total imports during the month under review, with Belgium and Germany having supplied 2.5 percent (P105.3 million) and 2.4 percent (P102.7 million) of total imports respectively.