Own Correspondent
25th July 2025
Botswana’s Real GDP growth has contracted by 3% in 2024 compared to a growth of 3.2% in 2023 (-0.3% in 2025Q1) Bank of Botswana(BOB) officials have revealed.
The contraction in 2024 was mainly attributable to subdued global demand for diamonds and domestic structural constraints.
“Mining output decreased by 24.1% in 2024, a notable contraction from a growth of 2.9% recorded in 2023 (-7.7% in 2025Q1) Global inflation decreased from 6.7% in 2023 to 5.7% in 2024,” said Innocent Molalapata, Director, Research and Financial Stability Department at the Bank of Botswana.
He said, “Non-mining GDP grew by 2.8% in 2024, compared to a higher growth of 3.3% in 2023(1.4% in 2025Q1).”
Average inflation for trading partners decreased from 5% in 2023 to 3.3% in 2024. Headline inflation decreased significantly from 5.2% in 2023 to 2.8% in 2024 (2% in June 2025).
Annual growth in commercial bank credit decelerated to 6.5% in 2024 from 7.1% in 2023
(accelerated to 9.2% in May 2025). The industry was profitable. Net after-tax profit of the banking industry rose by 31.7 percent from P3.1 billion in the year to December 2023 to P4.1 billion in the corresponding period in 2024.
The growth was allegedly due to respective significant increases of 17.5 percent in net interest income and 12.4 percent increase in non-interest income, from P6.4 billion and P3.5 billion in 2023, to P7.5 billion and P3.9 billion in 2024.
“Slower pace of monetary policy easing and lower commodity prices expected to reduce inflationary pressures,” said Molalapata.
As in 2023, global financial markets were highly volatile in 2024. However, asset prices recovered against a backdrop of slowing inflationary pressures and a moderation of monetary policy tightening by central banks.
During the year under review, equities significantly outperformed bond markets on the strength of technology stocks, mainly driven by artificial intelligence stocks.
The Bank’s administration costs were higher than in the previous year; with increased BoBC’s interest cost against a decreased level of Bank of Botswana Certificates recorded as at year end.
Thatayaone Magole, Acting Chief Financial Officer at the Bank of Botswana, said “Decrease in reserves is mainly due to the withdrawal of foreign exchange reserves during the year.” The level of foreign exchange reserves decreased by about 24 percent from P63.7 billion in December 2023 to P48.1 in December 2024, mainly on account of withdrawals during 2024. As at 31 May 2025, the level of foreign exchange reserves had slightly dropped by P0.9 billion to P47.2 billion from the December 2024 balance.
