Time for a new development paradigm
Douglas Rasbash
Despite billions in development spending, Douglas Rasbash argues that Botswana’s planning model has drifted from transformation to performance, with weaker growth and higher unemployment exposing the need for sharper, outcome focused development policy.
By the time a country has spent over P660 billion in development expenditure and still finds itself trapped in weak growth, rising unemployment and declining economic confidence, something has gone fundamentally wrong. Not marginally wrong but structurally wrong. The latest long-term development analysis compiled by the 2nd Republic Policy Think Tank comparing Botswana’s National Development Plans tells a deeply uncomfortable story. Since NDP9, accumulated development spending has exploded from around P35.7 billion to roughly P662.8 billion under NDP12. Yet instead of stronger growth, the economy has progressively weakened. GDP growth has deteriorated from around 5% during the NDP9 era to a contraction of about 5.4% in the current period. Meanwhile unemployment has climbed relentlessly from approximately 18% to around 30%. In simple terms, Botswana is spending vastly more money to achieve progressively worse outcomes. That should alarm every citizen.
SPENDING TRAP
For years government has defended rising development expenditure by arguing that infrastructure investment automatically creates growth. Roads, flyovers, airports, office complexes, utilities, corridors, industrial parks and “economic enablers” were all presented as catalysts for transformation. But transformation has stubbornly refused to appear. The problem is that Botswana increasingly confuses spending with development. Development is not measured by how much concrete is poured or how many billions are allocated in budget speeches. It is measured by whether citizens become more productive, more employed, more prosperous and more economically secure. Those outcomes are deteriorating.
WEAKENING RETURNS
The chart is devastating because it exposes a long-term trend rather than a temporary crisis. This is not simply about COVID, diamonds, global shocks or drought. The weakening trajectory stretches across successive planning periods. The economy has gradually become less responsive to public investment despite ever larger expenditure envelopes. Why? Because government has increasingly lost sight of the difference between productive investment and enabling expenditure. A productive investment directly generates economic output, exports, productivity gains, enterprise creation or employment. A factory producing goods. A solar manufacturing cluster. Export agriculture. Tourism product development. ICT services exports. Logistics businesses. Commercial innovation ecosystems.
By contrast, much of Botswana’s spending has drifted toward enablers and administrative infrastructure whose economic returns are often indirect, uncertain or overstated. Roads linking low-density settlements to other low-density settlements do not automatically create industries. Airports without traffic do not create aviation sectors. Industrial parks without globally competitive industries become expensive real estate projects. Botswana now risks entering the classic middle-income infrastructure trap: building more and more public assets while the productive economy underneath weakens. Even more worrying is that public investment increasingly appears disconnected from rigorous economic appraisal. One has to ask whether many projects entering national plans would survive proper scrutiny using Net Present Value (NPV), Economic Internal Rate of Return (EIRR), affordability testing, lifecycle costing and employment impact analysis. Would all these projects genuinely demonstrate strong economic returns if independently stress tested? Or have development plans gradually become politically assembled shopping lists? The evidence increasingly points toward the latter.
DANGEROUS ILLUSION
The most dangerous illusion in Botswana today is the belief that government expenditure itself is economic transformation. It is not. In fact excessive state-led capital expansion can crowd out productive private sector activity, increase debt pressure, weaken foreign reserves, raise operating costs and ultimately undermine competitiveness. This is precisely what Botswana may now be experiencing. Despite decades of investment, the economy remains heavily dependent on diamonds, SACU revenues and government spending itself. That is not diversification. It is chronic dependency. Meanwhile youth unemployment continues rising. Labour force participation weakens. The private sector struggles to expand. Formal job creation is inadequate. Productivity growth is poor. Export diversification remains limited. And increasingly educated young people are becoming disconnected from the economy altogether.
Yet the official response remains largely unchanged: spend more. Another road. Another hub.
Another authority. A Convention Centre. A Mega Airport. A Thermal Power Station. A Smart City.
Another strategy. Another masterplan. Another ground breaking ceremony. But where is the corresponding growth? Where are the jobs? Where is the diversification? Where is the productivity revolution?
SMARTER PLANS
Botswana urgently needs to rediscover the original purpose of development planning. National plans should not primarily be expenditure frameworks with each MDA trying to outbid the other. They should be transformation frameworks tied to measurable outcomes. Ministers must consider themselves CEOs aiming to maximise revenues, minimise expenditure, generate jobs and raise living standards – not merely spending champions. Every pula invested should answer four basic questions. Does it create sustainable employment? Does it improve productivity? Does it strengthen export competitiveness? Does it generate measurable economic returns greater than its long-term cost? If not, it should not proceed. This requires a complete shift in planning philosophy. Botswana does not necessarily need bigger plans. It needs smarter plans. Smaller, sharper, commercially grounded and rigorously evaluated.
INPUTS OVER OUTCOMES
The country also needs to stop assuming that all infrastructure is automatically developmental. Some infrastructure supports growth. Some merely supports more expenditure. There is a difference. The uncomfortable truth is that Botswana’s development model may have become increasingly performative rather than transformative. Planning has become obsessed with inputs instead of outcomes. Billions are announced, projects launched, ground broken, consultants appointed and speeches delivered — while the economy beneath quietly weakens.
At some point government must confront reality. If spending nearly twenty times more development money produces weaker growth and higher unemployment, then the problem is no longer implementation alone. The problem is the model itself. NDP 12 must be scrapped. It is simply wrong for Botswana. Needed is a serious development policy. Not a vision, not another plan, but a new way of thinking about development. And unless Botswana regains economic discipline, prioritisation and rigorous project selection, NDP12 risks becoming not the plan that transformed the economy, but the plan that finally exposed that government had lost the plot.