Botswana: Investing

FDI in Figures

FDI in-flow which has been continuously increasing in recent years, petered out in 2009 due to the global economic crisis, and is expected to increase again with the economic recovery.

Botswana has committed itself to diversifying its economy away from mineral resources and encourages FDI. The reduced level of corruption, good economic governance, a liberal taxation system and a stable democracy are the country’s strengths, which enjoys very favourable comments from rating agencies such as Moody’s and Standard & Poor’s. The main hindrances to investments are the high costs of production, the lack of a qualified workforce and the landlocked state of the country.

The mining sector attracts most of the FDI however, investments in services (insurance and banking) are booming. FDI mainly comes from the Southern African Customs Union (SACU), the European Free Trade Association (EFTA), Canada and Zimbabwe.

	Botswana	Sub-Saharan Africa	الولايات المتحدة	Germany
Index of Investor Protection	6.0	4.4	8.3	5.0

Source: Doing Business

Note: The Greater the Index, the Higher the Level of Investor Protection.

Foreign Direct Investment	2008	2009	2010
FDI Inward Flow (million USD)	521	579	529
FDI Stock (million USD)	884.6	1,405.3	1,298.6
Performance Index*, Ranking on 141 Economies	68	78	-
Potential Index**, Ranking on 141 Economies	88	-	-
Number of Greenfield Investments***	17.0	13.0	-
FDI Inwards (in % of GFCF****)	16.7	36.0	-
FDI Stock (in % of GDP)	6.6	8.4	-

Source: UNCTAD - Last Available Data

Note: * The UNCTAD Inward FDI Performance Index is Based on a Ratio of the Country's Share in Global FDI Inflows and its Share in Global GDP. ** The UNCTAD Inward FDI Potential Index is Based on 12 Economic and Structural Variables Such as GDP, Foreign Trade, FDI, Infrastructures, Energy Use, R&D, Education, Country Risk. *** Green Field Investments Are a Form of Foreign Direct Investment Where a Parent Company Starts a New Venture in a Foreign Country By Constructing New Operational Facilities From the Ground Up. **** Gross Fixed Capital Formation (GFCF) Measures the Value of Additions to Fixed Assets Purchased By Business, Government and Households Less Disposals of Fixed Assets Sold Off or Scrapped.

Tax Rates

VAT: 10%
Company Tax: A basic company tax of 15%, or a special tax rate of 5% for manufacturing and for companies in Botswana International Finance Services Centre.
Withholding Taxes: Dividends: 15%, Interest: 15%, Royalties: 15%
Bilateral Agreement: Botswana and Egypt are not bound by a Double Taxation Agreement.
Social Security Contributions Paid By Employers: 0%

Investment Opportunities

Tenders, Projects and Public Procurement: Tradeinvest Africa, Tenders in Africa
African Tenders
African Development Bank Group, Public Oversight Body
DgMarket, Tenders Worldwide
Setting Up a Company: Consult Doing Business Website, to know about procedures to start a Business in Botswana.
Useful Resources: Botswana Export Development and Investment Authority (BEDIA)
Economic Developments and Prospects in Botswana - African Economic Outlook

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