The reason why Botswana might have avoided conflicts that come with natural resources could be attributed to the country’s decision that all natural resources are managed by the state, which is not the case with many countries around the world.

Presenting a paper titled :Good Governance and Resource Management: The Case of Botswana, at a in forum on Fair and Sustainable Resource Management, Eschborn, in Germany recently, the Minister for Presidential Affairs and Public administration, Dr. Gloria Somolekae, noted that studies have concluded that countries that are highly dependent on revenues from natural resources, such as minerals, tend to do less well in terms of human development and governance, while also being at greater risk of succumbing to internal conflicts and authoritarianism.

She said this observed pattern has given rise to the resource curse thesis, which posits that the existence of natural wealth is a potential source of stagnation and instability, rather than an enabler of growth and development.

“Yet, since 1966, my country has been hailed as an enviable record of sustained economic growth and social progress, despite remaining dependent on revenues from mineral exports. This has resulted in our often being cited as an exception to the so-called “paradox of plenty”, said Dr. Gloria Somolekae.

“As a small developing country we therefore took the decision that all resources must be managed by the state in and equitable and transparent manner in order to ensure that they are of direct benefit to the entire nation,” she added.

“In this context, we are often asked whether our record of resource management holds any wider lessons on how to escape the alleged curse? As a proud citizen, I am naturally attracted to the suggestion that we may be a best practice benchmark. But, experience also cautions me that such an affirmation needs to be qualified in the context of general criticism about the validity of the resource curse thesis, as well as the specificities of Botswana’s experience.”

Between 1966 and 2008, Botswana GDP annually grew by more than 7% on average, moving the country by 1992 from least developed to middle income status. Since 2008 the figures have been more volatile, reflecting the negative impact of that year’s downturn on our mineral revenues.

The national budget during the same period climbed from just under US$ 3 million to over US$ 4 billion. Domestic formal sector employment rose from less than 14 thousand to over 300 thousand, while the 8kms of tarred road we had in 1966 expanded to over 20,000 kms. “I take particular pride in the fact that education and health have remained the two largest recipients of public expenditure. Over 90% of our people now live within 15km of a modern health facility, while adult literacy has risen from 10% to 87% by 2001. Whereas in 1966 no more than a few dozen Batswana had received any form of post-secondary education, today hundreds of thousands have attended tertiary level institutions.”

“Notwithstanding the above, Botswana’s development path, as well as the resource curse thesis, are not without their critics. With respect to the thesis, it is noted that my country has not been alone in substantially reinvesting commodity export revenues into public goods. Some have further observed that by using statistical measures based on the ratio of a given nation’s primary commodity exports divided by its gross income, proponents of the thesis have tended to measure resource dependence of various societies, rather than the abundance of their resource endowment,” the former University of Botswana lecturer added.

However, she highlighted that critics to Botswana’s development path have pointed to the undeniable fact that, notwithstanding various economic diversification initiatives over the years, our economy has remained vulnerable due to its continued diamond dependency.

“This circumstance was manifest during the 2008 global economic downturn, which was accompanied by a sharp decline in diamond demand, causing our economy to contract for the first time since independence. The fact that we have avoided recession in the past can thus in large part be attributed to the previous stability of the diamond market when compared to most commodities, a variance that has to a great extent been due to factors that are peculiar to the industry.”

Dr Somolekae noted that like most minerals, the extraction of kimberlitic diamonds is capital, rather than labour, intensive. This fact has contributed to the challenge my country currently faces in generating sufficient productive employment. Notwithstanding our high expenditure on education and training, there is a growing gap between the number of graduates entering the job market and the vocational opportunities waiting there for them, which can only be partially attributed to a mismatch of skills.

“Proponents of the resource curse might argue that such observations are beside the point. They maintain that the very processes by which natural resources are exploited tends to fuel rent-seeking behaviour, resulting in inordinate benefits being channeled to an elite few. In this respect it is undeniable that all too often income from minerals in the developing world has been misappropriated by politicians and bureaucrats for their private gain,” she pointed out.

“Also central to the resource curse thesis is the argument that struggles for control over mineral wealth, including diamonds, have given rise to internal grievances that fuel political instability, at times degenerating into armed conflicts. Here again one can see Botswana as an exception as we have been consistently rated among the world’s most peaceful and politically stable societies by the World Bank and other international monitoring institutions, such as the Global Peace Index, generally scoring well above most countries in the developed as well as developing world.”