Botswana - Country Commercial Guide
Market Opportunities

Overview of best prospect sectors, major infrastructure projects, significant government procurements and business opportunities.

Last published date: 2022-08-02

Botswana offers low tax rates and has no foreign exchange controls.  Labor strife is minimal. Botswana has the potential to leverage its position in the region to serve as a gateway to the southern African market as a member of SADC and SACU.  The commissioning of the Kazungula bridge in 2021, in the northern part of the country has made this potential a reality.

  • The Botswana Investment and Trade Centre (BITC), the GoB’s trade and investment promotion agency, was designed to serve as a one-stop shop to assist investors to set up a business and find a location for operation.  BITC’s ability to streamline procedures varies based on the GoB entity involved and bureaucratic requirements.  BITC has helped some U.S. companies to resolve work permit challenges.  BITC’s criteria for support for investment projects is whether the project will diversify the economy away from dependence on diamond mining and whether it will create jobs for, and transfer skills to, Botswana citizens.
  • The GoB has set up a Special Economic Zone (SEZ) authority to implement the 2015 SEZ law, which is export-oriented and aligns with the country’s national priority to promote export-led growth.  This initiative is geared to streamline investment in sector-targeted geographic areas in the country, including two Gaborone area SEZs (multi-use, diamond processing, and financial services); two Selibe-Phikwe SEZs (mineral processing and horticulture); and additional SEZs in Lobatse (beef, leather, biogas); Palapye (energy); Pandamatenga (agriculture); and Francistown (mining and logistics).
  • In 2017, Parliament approved a special incentive packet for Selibe-Phikwe geared to promote economic growth and diversification.  Some of the incentives include reduced corporate tax of 5 percent for the first five years and 10 percent thereafter (versus the 22 percent national tax rate), zero customs duty on imported raw materials, rebates for customs duty and value added tax for any exports outside SACU, and a minimum of 50 years on land leases (instead of the standard lease of 25 years).  In addition, the GoB has committed to a 30 percent offtake for any business set up in the area.
  • Botswana’s mining sector dominates the economy and is correlated with global market trends.  De Beers dominates Botswana’s diamond industry.  Its mining operation, Debswana, is jointly owned by the GoB and De Beers, and produces between 20-22 million carats per year, including some of the finest large diamonds in the world.  In 2012, the GoB launched the state-owned Okavango Diamond Company, which receives 15 percent of Debswana’s mined rough diamonds for its own sale.
  • To address its domestic power shortages as well as those of the region, the GoB seeks to become a net exporter of electricity by adding solar power, wind, and coalbed methane to its energy mix.  In April 2021, the GoB signed a Memorandum of Intent with the governments of the United States and Namibia and developing banks to establish a Mega Solar program, which will support the development of solar power in Botswana and Namibia and help to build a regional market for clean energy.  Mega Solar will support Botswana’s existing power development strategy under its Integrated Resource Plan (IRP) ensuring that projects are developed effectively and efficiently and within a reasonable time period, while also positioning the regulatory environment to enable private sector investment in clean energy.   The GoB has begun to award contracts for independent power projects and has released a National Energy Policy (NEP) which gives guidance on the management and development of new and renewable energy sources.  In March 2020, the U.S. Trade and Development Agency (USTDA) gave a grant to a local company to perform a feasibility study of a coalbed methane power plant.
  • Botswana’s political stability and record of prudent fiscal management signal potential to become a center for niche financial services. 

Botswana’s tourist market has historically been characterized by a “high value (cost), low volume” philosophy.  High-end tour operators and hotels tend to dominate the market.  The GoB is interested in expanding tourism services throughout the country with mid-range offerings, especially by citizen-owned tourism companies