GABORONE, Botswana — Diamond-rich and politically stable Botswana has been granted a $1.5 billion loan from the African Development Bank to help it cope with the global economic crisis, the bank said Wednesday.
GABORONE, Botswana — Diamond-rich and politically stable Botswana has been granted a $1.5 billion loan from the African Development Bank to help it cope with the global economic crisis, the bank said Wednesday. The organization said in a statement that the loan was meant to help Botswana bridge a budget deficit for 2009-10 estimated at 13.5 percent of gross domestic output. "The case of Botswana illustrates the impact that the financial crisis is having on even the best managed economies in Africa," said Donald Kaberuka, president of the regional multilateral bank, which is dedicated to alleviating poverty and spurring development on the continent. "I am delighted that the bank has been able to respond quickly and flexibly in this ‘unique case’ within the bank’s framework of response to the financial crisis," Kaberuka said of the loan. The bank said it was the first time Botswana has had to borrow from it in 17 years. Instead, Botswana had in the past contributed funds for the bank to loan to other governments. In his budget speech in February, Botswana’s Finance Minister Baledzi Gaolathe had said diamond sales dropped significantly last year. Earnings from other minerals like copper, nickel and gold also were expected to be hit. Gaolathe blamed the global economic slowdown, and said lack of available credit and long-term investment could slow local consumer spending, reduce employment and incomes, and hit personal savings. He said the government would try to help by drawing on its reserves and by borrowing. ______ Copyright 2009 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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