ECONOMIC DEVELOPMENT NOTES

ECONOMIC ACTVITY-Using natural resources to create wealth

DEVELOPMENT-A process of changing for the better
BCONOMICDEVELOPMENT-Using natural resources to create wealth in a country in order to
improve the standard of living of people
ECONOMIC DIVERSIFICATION-having many economic sectors in a country so that if one sector
is not doing we then the other sectors can generate income for the country

ECONOMIC SECTORS IN BOTSWANA

Mining-extraction of minerals

Agriculture-growing of crops and rearing of livestock

Tourism-providing people on holiday with accommodation and recreational activities
Manufacturing-turning raw materials into finished goods or assembling of parts to make a complete
product

Trade and communication-selling of manufactured goods .transportation of goods and

dissemination of information

FACTORS THAT CONTRIBUTE TO ECONOMIC DEVELOPMENT

-availability of natural resources
-availability of human resource
-availability of technology
-availability of market
-availability of capital

MINING
Extraction of minerals

CONTRIBUTION OF MINING TO ECONOMIC DEY.

-creates employment
-brings foreign currency
-leads to improvement in infrastructure
-social responsibility
-manpower development
 CHALLENGES
-shortage of skilled manpower
-Fluctuation of world prices
-lack of capital to buy expensive machinery
-foreign ownership
-environmental damage
POSSIBLE SOLUTIONS

-train more Batswana on specialised jobs

stock piling
-legislation protecting the environment

AGRICULTURE
Growing of crops and keeping livestock
CONTRBUTION TO ECONOMIC DEV.
-creates employment
-Source of income

-source of food

-source raw materials for other industries

CHALLENGES
-Poor soils

-low rainfall

-pests and diseases

-poor farming methods

-lack of capital to buy farm implements
POSSIBLE SOLUTIONS
-education on good farming methods
-give loans to farmers to buy machinery, fertilizers,pesticides
-encourage farmers to go into commercial farming
 TOURISM
facilities
Providing people on holiday with accommodation and recreational
CONTRIBUTION TO ECONOMICDEVELOPMENT
-Creates employment
-source of foreign currency

-provide market for local crafts man

-leads to improvement in infrastructure

-encourages conservation of natural resources

CHALLENGES
-Seasonal business

-competition
poaching
infrastructure
-lack of capital to build and maintain
-environmental damage
POSSIBLE SOLUTIONS

-improve roads and accommodation

-more advertisenment

-employ more people to guard against poaching

-promote culture based tourism

MANUFACTURING
assembling parts to make a complete product
Turning raw materials into finished goods and
CONTRIBUTION TO ECONOMIC DEY.

-creates employment
-source of foreign currency
-source of income
 -reduces costs of importing goods

CHALLENGES

-lack of skilled manpower

-smallmarket

-competition
poor infrastructure
-expensive utilities

POSSIBLE SOLUTIONS
-entering into trade agreement with other countries
-improvement in infrastructure
-government policy'

TRADE ANDCOMMUNICATION
This sector is about moving goods, services,, information and people. The movement can take place
within or across the countries.
CONTRIBUTION TO ECONOMICDEVELOPMENT

-creates employment;
-goods are easily transported across countries
-telephones makes communication easier

-encourages quick exchange of information

CHALLENGES

-small market

-poor transport network

-lack of managerial skills

-competition from goods produced from other countries

POSSIBLE SOLUTIONS
-train more people in business management
creation of more employment opportunities to increase the buying power
-development of infrastructure eg roads and communication networks to
make rural areas accessible

HOW CORRUPTION UNDERMINES ECONOMI C DEVELOPMENT

Corraption is the process of acting dishonestly or illegally in return for money or
people in authority or power. Forms of corruption incude bribery, fraud and personal gain by
embezzlement.
Corruption can hinder economic development in the following ways;
-collapse of sectors/increase poverty
-demoralises the work force/lowers productivity
-undermines the rule of law

-it discourages foreign investment and saving/scares away investors

-diverts investment/delays developments
-encourages low quality projects
-increases the gap between the rich and the poor

WAYS OF PROMOTING ECONOMIC DIVERSIFICATION

Economicdiversification -having many economic sectors instead of relying on one, so that if one
sector is not doing well then the other sectors can generate wealth for the country.

-Corruption free practices; so that the sectors can make maximum profits

-training more personnel; skilled manpower is needed to work in different economic sectors to
avoid collapse of sectors and to generate wealth.
save
-import substitution; Botswana should produce more goods to minimise the import in order to
money.

-provision of loans to business people; to increase production and employment.

-goods and services should meet global standard
THE ROLE OF GVT, IN PROMOTING ECONOMIC DIVERSIFICATION
Positive
as to increase
-provision of loans; so that business people can start their own businesses so
production and create employment
in order to generate money for
training more people; to impart skills needed in the economic sectors
the country
Botswana in order to increase
-attract more investors; allowing business people to operate in
production and create employment.
 -provide bnsic infrastrnetnre eg ronds, telecommunication networks in order to easy transfer of raw
materials,goods, trade etc.
taxation : revenue generated from tax can be used to start other businesses
negative

-insufficient infrastructural development; it hinders transport of raw materials and goods. it may
lead to manufacturing industries collapsing.
-insufficient training of Batswana-leads to shortage of skilled manpower which result in hiring of
foreigners and making less profit.
-lack of monitoring of projects by the gvt;it leads to collapse of projects hence loss of money and
jobs.
-high tax; can lead to collapse of projects hence loss of money and jobs

THE ROLE OF THE YOUTHIN PROMOTING ECONOMIC DIVERSIFICATION

Positive

-form groupsto start businesses;in order to increase production and create jobs
get loans from gvt schemnes to start their own businesses

-cdncate each other on business management;to Avoid the collapse of businesses.to keep the
businesses running.
-take part in ail development projects geared towards economic dev;as the most active they
should work in economic sectors to generate money

Negative
-misuse of funds they got from financial agencies; leads to closure of business and loss of jobs
-majority of youth are only interested in white collar jobs; this delays the growth of the
agricutural sector.
THE ROLE OF NGOs AND AD AGENCIES (CEDA,YFE IN PROMOTING ECONOMIC
DIVERSIFICATION
-manpower development;trains people on skills that are needed in the economic sectors.
-financial assistance;help people with loans so that they start their own businesses and be self
employed and create employment for others.
-promote sustainable development; this enhances conservation of the natural environment which
will enhance tourism

-help the destitutes,disabled (red cross)-to improve the standard of living for the disadvantaged.
Reduces dependence on the government.
Negative

-mostly based in urban areas;people in rural areas hardly get the services
-insufficient funds; they do not have enough funds to Assist people hence high unemployment rate.
IMPORTANCE OF GLOBAL ECONOMIC FORCES IN THE ECONOMY OF BOTSWANA
Positive

-fluctuation of world prices; at times our beef and diamonds are bought at high prices hence more
profit
-devaluation of currencies-this will make our exports cheaper and attract more market for the
country

-financial assistance; the country can get loans from the world bank to develop the country
-market: Botswana sells her beef and diamonds to the EUand the money is used to develop the
country

Negative
global inflation; this is the increase of prices of goods and services which results in a fall of the
currency.

-devaluation of currencies; this will make imports expensive and more money will be used.
less or
-fluctuation of world prices; at times the diamonds and beef are bought at lower prices hence
no profit for the country
-economic recession; this leads to loss of jobs

-financial assistance come with interest; resulting in a debt trap