ABSTRACT
INTRODUCTION Botswana today is a paradox of political economy. It is a capitalist economy based on central planning. More capitalist than any of its neighbours (including South Africa) in lack of state ownership, control and management of industry or agriculture or even of infrastructure. But also more planned than even supposedly-socialist states in Southern Africa, in terms of state machinery identifying, projecting and inducing the growth of economic sectors over five-year periods.The role of the state in recent economic development has been the product of necessity. For twenty years before 1971-72, state revenue from an impoverished economy - one of the world’s ten poorest nations - was insufficient even to cover the recurrent government budget. For more like seventy years Botswana (then Bechuanaland Protectorate) had been reduced to the poorest of the poor by almost complete subordination to the interests of the South African economy.The ‘break-out’ of the Botswana economy - thirtyfold growth in the past two decades - has been made possible by the exploitation of diamonds and beef under state patronage. State revenue has burgeoned, from 15 to 1195 million Pula between 1967-68 and 1986-87, making Botswana a classic test case of whether development can really ‘trickle down’ from the urban mineral top to the rural subsistence bottom. It is also a test of whether the state can tackle the two inheritances that loom largest for the Botswana economy - the vagaries of climate, and the proximity of South Africa.
