Africa’s Success Story
AFRICA, 18 Jan 2016
13 Jan 2016 – The most impressive person I met in Botswana barely said a word.
She was an older woman, small in stature. We were sitting next to each other at a table during lunch at a conference about Botswana’s economic model. In a quiet voice, she told me that she was a former government minister. We talked briefly about the conference, neither of us saying anything particularly memorable. Then we were both drawn away by other conversations.
Diamond-rich Botswana avoided the dreaded resource curse and established a prosperous, stable democracy. But political turmoil has begun to roil the traditionally placid society.
I learned later that Gaositwe Chiepe was the first woman to serve as a government minister in Botswana, the large but sparsely populated country just to the north of South Africa and sandwiched between Namibia and Zimbabwe. Chiepe had served in a number of capacities, including foreign minister, over five decades of civil service. Now retired and in her late 80s, she was still attending public functions. She’d come not as a speaker, but only to listen, and she had no glitzy entourage.
Later, when I was trying to figure out why Botswana was an African success story, I realized that I’d already encountered the answer — in the person of Gaositwe Chiepe.
Since securing its independence in 1966, Botswana vaulted from one of the poorest countries on the continent to one of the richest. From 1966 to 2014, its economy was the third fastest growing in the world — by per capita GDP — after China and South Korea. During that time, it has achieved an adult literacy rate of 85 percent, and nearly 90 percent of children are enrolled in primary school. It’s one of the few countries in Africa with a stable democracy where the elected leaders have served their terms and then stepped down, instead of resorting to coups or constitutional changes to maintain power.
There’s no question that Botswana has been lucky. A year after independence, some of the richest diamond mines in the world were found there. But many countries in Africa have been blessed with comparable riches — Congo, Sierra Leone, Angola — and have experienced war, dictatorship, rampant corruption, and little else. The reason why Botswana has largely escaped the “resource curse” has something to do with luck, but much more to do with people like Gaositwe Chiepe. She’s a member of the 3H generation — hard-working, honest, and humble — a cadre of public servants who ensured that the country would succeed where so many others have not.
But the Botswanan economy remains dependent on its diamond wealth. A fifth of the population lives below the poverty line, and roughly one out of every three young people is unemployed. An uptick in corruption and political turmoil has begun to roil the traditionally placid society. The country needs another miracle to somehow get to the next level of prosperity. But who or what will supply that miracle?
The Jwaneng mine is the richest producer of diamonds in the world. It’s located a couple hours west of the Botswanan capital of Gaborone, and it’s surrounded on several sides by a game park. The mine itself doesn’t look like much, of course — just a huge gash in the ground, ringed by heaps of earth displaced by the diggers and the trucks. It’s a barren landscape, largely devoid of vegetation. The guide driving us around the pit mentions that baboons occasionally scamper into the area. We don’t see any animal life. It might as well be the moon.
At the bottom of the pit is the top of the “pipe,” a natural shaft that goes deep into the earth’s crust and through which the gems have been brought up close to the surface by past volcanic activity. Debswana — the joint venture between the De Beers diamond company and the Botswana government — is now preparing for what it calls Cut-8. Each “cut” is a wider-angle slice into the pit in order to reach deeper into the pipe and extract more diamonds. Cut-8 is expected to extend the life of the mine until 2025, providing $28 billion to the Botswana economy and more than 1,000 jobs.
I’m with a group of journalists invited by De Beers to tour its facilities and attend a conference co-sponsored with Chatham House. In addition to the mine, they take us to a school and a health clinic for the workers and their families — a community of around 30,000 people. Everything is spotless.
I’ve no reason to believe that Jwaneng is a Potemkin Village. Most Botswanan miners are unionized, and the jobs are coveted. De Beers took the lead in subsidizing antiretroviral treatments for its employees. None of this is charity, exactly. De Beers relies on a well functioning and highly trained workforce in a country of only two million people. It can’t afford to be cavalier about its workforce.
Also, De Beers doesn’t have an adversarial relationship with the Botswanan government. Instead of nationalizing the fledgling diamond industry in the 1960s or handing it over completely to De Beers, the government established a public-private partnership with the company. The government gets a large cut of the profits as well as a decision-making role on the corporation’s board. In exchange, De Beers operates in a stable and secure environment.
The latest twist in this partnership is “beneficiation,” a process by which Botswana extracts more value from each diamond mined on its territory as well as some of the diamonds mined elsewhere in the De Beers empire. As I write this week in Foreign Policy:
The plan turned the global diamond industry upside down. In the past, buyers traveled to London to view the rough gems that De Beers had mined from operations in 28 countries. But for the past two years, as a part of the beneficiation process, these buyers have gone to the other side of the globe, visiting the capital of Botswana to buy an annual $6 billion worth of diamonds.
These so-called “sightholder visits,” 20 of which have taken place since the beneficiation process was launched in 2013, have turned Gaborone into a diamond destination, and locals have been scrambling to take advantage of the influx of wealthy merchants. New hotels and restaurants have opened in the capital, and De Beers has even created an enterprise development program to mentor local entrepreneurs in support services like IT and catering.
But it’s not just that Gaborone has become a diamond-trading Mecca overnight; it has also started to build up its diamond-processing sector to ready the rough gemstones for sale. Whereas in the past nearly all of the diamonds were cut and polished abroad, now roughly 15 percent are handled by the 20 or so cutting and polishing operations that have sprouted up in the capital in recent years. These outfits are mostly run by expats, many from India, but they are training local workers to turn rough diamonds into the finished gemstones sold directly to Tiffany & Co. and other upmarket retailers, as well as to a handful of local jewelry manufacturers. In 2013, sales of cut and polished diamonds in Botswana reached nearly half a billion dollars.
Botswana was dealt a pretty good hand in 1967, and it has played its cards well. But the market for diamonds, like all commodities these days, is volatile. Even with Cut-8 and beneficiation, Botswana needs to diversify its economy. Diamonds contribute around 30 percent of GDP and 75 percent of export revenues. Botswana has some other potentially valuable commodities under ground, such as coal and copper. But diversification will require a move away from extractive industries altogether.
But the real challenge may well be political. Botswana is a democracy, but along the lines of Japan, where a single party has been in power for decades. This status quo is changing. Given some of the country’s current problems, it could perhaps use a little shaking up.
In the run-up to parliamentary elections last year, opposition politician Gomolemo Motswaledi died in a car accident. The opposition Botswana Movement for Democracy (BMD), of which Motswaledi was the leader, immediately alleged government involvement in what they speculated was a politically motivated murder. The full report on the investigation into the incident has yet to be released.
If the incident had been unique, perhaps the public would have accepted the government’s explanation. But a number of people have died recently in unusual circumstances. In 2010, the body of former Debswana Managing Director Louis Goodwill Nchindo was found in a rural area, a month before he was to appear in court on corruption charges. There were rumors that he had secrets to tell about powerful people in Botswana, including the De Beers founding family, the Oppenheimers. Government security forces were implicated in the 2009 murder of businessman John Kalafatis and the attempted killing of his brother Costa four years later. President Ian Khama stepped in to pardon the guilty and allow them to return to their positions.
Botswana has a high reputation for transparency — it has the best ranking in all of Africa in Transparency International’s Corruption Perceptions index — but a great deal of mystery surrounds these cases. There’s also considerable controversy around the relocation of 3,000 San (also known as Bushmen), the indigenous nomadic people, from their ancestral homelands in the Kalahari Desert between 1997 and 2002. Two hundred San brought a case against the government, and the Supreme Court ruled in their favor. But the government has interpreted the ruling to apply only to the 200 litigants. Critics suspect that the relocation had something to do with gaining access to the mineral wealth lying beneath those lands.
Getting more information about these cases is not made easier by the fact that Botswana lacks a freedom of information act (the ruling party has twice rejected a proposed bill). Another problem is that the government has been leaning more heavily on the press — particularly last year around the elections, when it withdrew advertising from media noted for their unflattering coverage of the ruling party.
Some of the interventions were more sinister. Journalist Edgar Tsimane, for instance, had published quite a few critical articles about the government. But a piece he published in September 2014 must have really rubbed someone the wrong way because he received warnings from informants that his life was in danger. He fled over the border to South Africa, where sought and received asylum.
As it turned out, the ruling Botswana Democratic Party (BDP) won a parliamentary majority in the 2014 elections. But it had good reason to worry about its popularity: It actually lost the popular vote and only maintained its grip on power because of the intricacies of the country’s first-past-the-poll system.
“We are seeing a shift now,” investigative journalist Alvin Ntibinyane told me. “The ruling party is no longer popular, and people are saying maybe the country’s hope lies with the opposition. In the last election, the popular vote went to opposition by 52 percent. The ruling party got 47 percent. That signals something for the ruling party. For the 2019 elections, it’s likely that for the first time in history, the ruling party will lose the elections. The question is: How will they handle this?”
Tshireletso Motlogelwa, publisher of Botswana’s Business Weekly and Review, agrees. “The ruling party is now consigned to the outskirts of the urban areas and the rural areas, and the tribal areas where the president comes from,” he observed. “BDP insiders are worried about that. Once you lose the middle class and the influential people in public discourse, it won’t be long before you are losing the election itself.”
Critics single out President Khama for particular scrutiny. “He comes from the military,” Motlogelwa continued. “He also comes from the ruling family. He has a different thinking altogether. Because of his background, he has a certain impatience with engagement. He thinks democracy is a waste of time that holds back development.”
“His presidency in his eighth year, and he has never held a press conference,” Ntibinyane added. “He has never addressed the nation, whether on radio or TV, on any issue. His credentials remain a secret. He is still a black box.”
The press is trying to push harder to expose corruption at the highest levels. The opposition is mobilizing to end the ruling party’s grip on power. What’s missing from the equation is a vibrant civil society.
Tracy Sonny, an environmental activist in Botswana, connects the lack of a strong civil society to the country’s middle-income status. “It’s not that we don’t have issues that need to be addressed,” she told me. “But there’s no drive in people as in other African countries. We as the people are the ones to find solutions to problems, but we just leave everything to government.”
For decades, Botswanans could leave everything to government because the government was staffed by people like Gaositwe Chiepe. That era is over. Another miracle could come out of the ground. But it’s more likely that the miracle will come from Botswanans themselves, as they chart a new path that will allow them to claim once again the mantle of Africa’s success story.
John Feffer is the director of Foreign Policy In Focus.
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