Botswana has been ranked the fifth best-address for investment in Africa, according to the latest Rand Merchant Bank 'Where to Invest in Africa' report.

This report – used by global investors within their African investment decision-making – puts Egypt in first place, followed by Morocco, South Africa, Rwanda and Botswana.

Researchers of the report said Botswana’s high foreign-exchange reserves have allowed it to deal with the economic impact of the pandemic better than most.

“Following an 8.5% contraction in 2020, Botswana’s economy is on a path of recovery, with growth slated for 6.7% in 2021,” the researchers said. “While the primary sector – diamond-mining in particular – is the main catalyst for this year’s growth, concerted efforts have been undertaken by both the private and public sector to ensure that the effects of the pandemic are minimised moving forward.”

Rand Merchant Bank Africa economist Daniel Kavishe said that this latest report takes into account the impact of the coronavirus crisis by looking at the actual and potential outcomes through and post-pandemic: “We created a new set of rankings that incorporated some of the unavoidable COVID-19-induced challenges, of which the operating environment score was one,” Kavishe said.

Both Rwanda and Botswana moved up the rankings because of their operating environments, the researchers added.

In addition, the report states that to ensure the delivery of the Economic Recovery and Transformation Plan (ERTP), the government has secured funding from the World Bank and African Development Bank amounting to $250m and $137m respectively. These funds will be allocated to attracting private-sector investments, creating job opportunities for a green economy and the diversification of Botswana’s exports.

The ERTP is also looking to finance and fast-track infrastructural projects across Botswana to bolster growth in the local construction industry.

“To ensure that plans to promote local production are successful, however, Botswana will have to address its implementation challenges,” RMB researchers added.