EuroEconomica, Vol 37, No 3 (2018)

Abstract

This paper discusses the dynamics of savings in Botswana during the period 1960 to 2015. The paper seeks to enhance a contextual understanding of the dynamics of savings in Botswana through an analysis of its savings composition, policy initiatives, saving trends, as well as challenges faced with respect to savings. The study finds that the gross domestic savings rate in Botswana is significantly high, averaging 26% between 1960 and 2015. Public savings are a significant component of gross domestic savings compared to private savings. Just as in the case of any country, Botswana has been facing some challenges with regards to savings. These include low private savings rate; imported inflation (especially from its major trading partner, South Africa); and high levels of unemployment, poverty and inequality. The study recommends, among other things, the strengthening of policy interventions that particularly promote private savings, while sustaining the current high public savings rates.