Botswana officials announced Wednesday the creation of a sovereign wealth fund designed to promote economic diversification and employment generation. The initiative responds to the nation's economic decline caused by falling global diamond prices. Diamond exports represent three-quarters of the country's total exports and generate one-third of government revenue. The economy shrank by three percent last year, with another contraction predicted for 2025. This new fund differs significantly from the existing Pula Fund, which has operated for over thirty years.
Board chairperson Farouk Gumel explained that the new fund prioritizes growth rather than mere financial stabilization. The fund will actively manage government assets and state-owned enterprises, many of which currently operate at a loss. Deputy chairperson Emma Peloetletse indicated that operations will rely solely on investment returns rather than capital withdrawals. The fund may pursue both domestic and international investment opportunities. Local and international experts comprise the initial board of directors overseeing this economic diversification strategy.
Board chairperson Farouk Gumel explained that the new fund prioritizes growth rather than mere financial stabilization. The fund will actively manage government assets and state-owned enterprises, many of which currently operate at a loss. Deputy chairperson Emma Peloetletse indicated that operations will rely solely on investment returns rather than capital withdrawals. The fund may pursue both domestic and international investment opportunities. Local and international experts comprise the initial board of directors overseeing this economic diversification strategy.
