Despite being a landlocked country of which 75% of the land mass is in the Kalahari desert and a relatively small population of just over 2.6 million people, Botswana has continued to beat the odds. It has remained one of Africa’s fastest-growing economies since independence, with one of the highest GDP per capita and a relatively high score on the Human Development Index (HDI).
Botswana’s growth is even more remarkable when we consider the fact it was one of the world’s poorest countries with a per capita income of just $70 when it gained independence from the British in 1966 but today has a per capita income of $7,757 which is comparable to that of some of the leading economies in Asia.
The countries stable and prosperous growth over the years is attributed to different factors, her diamond mines, strong economic management and governance. Amongst the leading institution contributing to this growth is the Botswana Unified Revenue Services (BURS), the Nation’s tax authority, currently under the visionary leadership of Jeanette Makgolo, BURS has played a pivotal role in the economic development of the country particularly strengthened by the use of technology.
Jeanette Makgolo was appointed the Commissioner General of BURS in August 2021; At the time of her appointment the ministry of finance said “she joined the services when the fiscal position of the country has deteriorated and new measures required to transform service into a modern revenue authority capable of improving collection of domestic revenue” and in no time she has turned the organisation into a corner stone of Bostwana’s economic architecture. She has strategically focused on enhancing tax compliance, improved service delivery to taxpayers and modernise tax administration in the country.
Under her leadership, the BURS introduced and implemented some innovative solutions such as the ‘track and trace’ system to cut down on tax losses while helping to boost tax revenues. BURS has been modernised with the introduction of new technology, many BURs processes are now digitised, electronic filing systems has also been implemented and online payment systems which has made it easy for service users throughout Botswana – thus the reduction in the cost of tax collection and closed up loop holes in the system, which has led to increased and accurate tax assessment thus creating a more reliable revenue stream for the government.
In just two years as the country’s first Female Commissioner general of BURS, Jeanette Makgolo has taken Botswana’s tax-to-GDP ratio from 15% to a remarkable tax-to-GDP ratio of 34% by June of 2023 which is the highest in Africa and amongst the highest in the world. For a broader base sustainable growth BURS has further implemented various initiatives to drive voluntary compliance, educational campaigns and various outreach programme with simplified processes has further contributed to this success
Owing to this improved revenue generation by the BURS under the leadership of Jeanette Chanda Makgolo, the Botswana government is now better able to fund its infrastructure development projects, social services, job creation efforts and give more support to small businesses to encourage entrepreneurship with the overall objective of growing the economy and improving the quality of life of its citizens.
Although Botswana’s wealth is primarily due to diamond mining which accounts for about 50% of the government’s revenue, the economic success of Botswana is more due to the prudent fiscal policy of the government which has consistently seen the government maintain a budget surplus while also implementing policies to grow their economy and maintaining a robust foreign reserve in the process.
The growth of the economy has also seen the diversification of the economy from the focused in diamond export to developing growth in tourism, agriculture and manufacturing.
The stable revenue stream has ensured that Botswana is one of the few African countries creditworthy thus able to attract foreign direct investment where needed, the Government is working to finance large infrastructural projects without the necessary reliance in the external debts.
Botswana has a reputation for being the least corrupt country in Africa according to the Transparency International (TI) Corruption Perception Index rankings.
While the economy of Botswana in terms of GDP remains small owing to the small size of its population, its per capita income ranks amongst the highest on the African continent while they have the second highest Human Development Index (HDI) which is indicative of the high quality of life in the country.
As a result of her efforts, Jeanette Makgolo was elected to the African Tax Administration Council to represent Southern Africa where she is helping to improve tax administration across the continent. Makgolo’s leadership will continue to drive sustainable growth.
Oshobi, a development economist, management consultant, and author writes from Lagos, Nigeria.