Economy grew marginally in Q1 2017
….as production in mining shrinks
Latest data from Statistics Botswana indicates that Botswana’s economy was adversely affected by a decline in mining during the first quarter of 2017.
According to recent figures compiled by the Statistics office, the domestic economy increased by 0.8% in the first quarter of 2017 (Q1 2017) compared to an increase of 2.3% recorded in the same quarter of 2016.
Figures show that mining production declined by 14.4% on yearly basis and declined by 6.4% on quarterly basis. The main contributors to the decline in production, according to the Statistics Botswana quarterly report on the performance of domestic economy, were copper-nickel-cobalt matte, diamonds and soda ash which declined by 11.3%, 2.7%, 0.5% respectively.
“Diamond production declined by 2.7% during the first quarter of 2017 when compared to production recorded during the first quarter of 2016 and the decline was largely due to the mining of lower grades diamonds in Jwaneng mine as well as Debswana’s decision to maintain business strategy to align production to trading conditions. The quarter-on-quarter analysis shows that diamond production decreased by 5.0% during the first quarter of 2017 when compared with production during the last quarter of 2016,” states the report in part. The report shows that gold production declined by 26.0% in the first quarter of 2017 when compared to the same quarter of 2016 and this decline was as a result of unstable commodity prices. When compared to 2016 fourth quarter gold production during the first quarter of 2017 decreased by 37.2%.
Statistics Botswana has indicated that a decrease of 39.0% in Soda Ash production was registered during Q1 2017 when compared to the same quarter of 2016 and quarterly comparisons reflects a decrease of 52.4 percent. The Statistics office says salt production recorded a decrease of 31.7% in the first quarter of 2017 when compared to the first quarter of 2016 and the quarter-on-quarter comparison shows a decrease of 52.1% in production.
“The closure of the three copper-nickel mines as well as unstable world commodity prices for all minerals are the major factors that contributed negatively to the growth of mining production during the first quarter of 2017,” said the statistician general Anna Majelantle.
“Production of soda ash declined because the markets remain restrained due to low demand as some of the industries utilizing the commodity have been affected by the low metal prices. Coal prices also remain depressed and stagnated which continues to negatively impact on the commodity export viability. BCL closure also impacted on the Morupule Colliery Mine production,” said Majelantle.
The statistician general has meanwhile indicated that during the first quarter of the year, non-mining boosted economic growth as it increased by 5.6%, compared to 3.7% registered in the same quarter of the previous year and the increase was mainly due to increase in business in trade, hotels and restaurants.