10 Feb 2025

In pursuit of long-term macroeconomic stability and intergenerational equity, government has committed to securing the wealth of future generations through the establishment of a Sovereign Wealth Fund.

Delivering the 2025/26 Budget Speech yesterday, Vice President who is also Minister of Finance, Mr Ndaba Gaolathe said the primary objective of the initiative was to ensure that the natural resource wealth was transformed into lasting financial assets, benefiting not only the present but also future generations.

“This approach is designed to preserve sufficient assets for future prosperity, even as the nation navigates the complexities of a dynamic global economy,” he said.

Mr Gaolathe further said the Sovereign Wealth Fund would be fully-fledged and strategically structured to make investments in both domestic and international assets, adding that the goal was to diversify the country’s wealth across various industries, ensuring that the fund grew in a way that generated sustainable returns over time.

He said by safeguarding financial resources, the fund would act as a buffer against unexpected economic shocks, natural disasters and other unforeseen events.

“More importantly, it will serve as a financial pillar for future generations, allowing them to build on the foundation laid by the current government,” he said.

 He added that the investment in sustainable and productive assets would equip future generations with the means to fulfill their ambitions and creating a robust economic safety net that extended beyond the lifecycle of today’s resources.

Mr Gaolathe said through the Sovereign Wealth Fund, Botswana was setting the stage for a future where its resource wealth contributed to a diversified economy.

He said that would help the country reduce its dependence on a single source of income and ensure that the benefits of natural resource extraction extended far beyond the lifespan of finite resources.

“The goal is to create a legacy of economic stability, opportunity and wealth, empowering future generations to continue the work of building a prosperous nation,” said Mr Gaolathe.

In addition, Mr Gaolathe said in line with Botswana’s vision of economic diversification and modernisation, the country was reimagining its approach to investment and resource allocation through the creation of a National Fund of Funds.

He said traditional models of direct funding for institutions such as the Citizen Entrepreneurial Development Agency (CEDA) and the Botswana Development Corporation (BDC) were being re-evaluated.

“The outdated, brick-and-mortar framework is giving way to a more dynamic and innovative approach that aligns with the nation’s development goals and global economic trends,” said Mr Gaolathe.

He highlighted that the National Fund of Funds will serve as a comprehensive vehicle for resource allocation, targeting strategic sectors that were key to national development.

He mentioned among them, not only the establishment of industries but also emergent sectors, such as the creative industries, which have the potential to drive significant growth and innovation.

The Vice President also said the fund would allow entrepreneurs, disruptors and innovators to access capital, thereby fueling the entrepreneurial spirit that was vital for Botswana’s economic evolution.

By embracing a broader vision of development, he said, the National Fund of Funds would play a crucial role in fostering an environment where innovation thrives.

He further pointed that investments made through the fund would be designed to generate tangible results in terms of job creation, economic growth and sustainable innovation.

The Vice President said the shift towards a National Fund of Funds marked a turning point in Botswana’s economic strategy, moving the country closer to a future where its financial resources were, “not just a means of survival but a powerful engine for growth and transformation”.

He emphasised that by targeting priority sectors and enabling a wide array of innovative ventures to thrive, Botswana was setting itself on a course for a future that values entrepreneurship and sustainable economic development at its core. ENDS