well as policy output dedicated to the economic diversification efforts, the narrow economic base persists, with limited success on economic diversification. this will require development of the non - tradeable sector and address gaps in the quality of the regulatory frameworks, human capital competitiveness. and innovation to boost global the third aspect relates to prospective transition to structural fiscal and balance of payments deficits and the consequent decline of the official foreign exchange reserves. in this regard, and with an eye on slowing the depletion of external and fiscal buffers, there is need to enhance domestic resource mobilisation, by broadening the tax base, increase the progressivity of the personal income tax, streamlining and rationalisation of distortionary subsidies and vat exemptions. furthermore, and with the right governance architecture, there is considerable scope for enhanced and more optimal domestic borrowing programme to tap into resources accumulated by the retirement funds, annuity providers infrastructure and financing other and institutional increasing the funds for productive capacity of the economy. having said the above, i am not inviting you, the media, to discuss with the bank fiscal policy options ; this is the preserve of elected government, and, in this regard, led by the ministry of finance and economic development. however, i can say, without risking any transgression into the fiscal policy space that, subject to the effectiveness of the policy responses and the success of the transformation agenda, the issues i outlined above have the potential to undermine the resilience of the economy to any future economic shocks including the effects of climate change, prolonged droughts and water scarcity, as well as erosion of macroeconomic policy discretion hitherto provided by strong fiscal and external buffers. it is, therefore, important to reinforce the focus on the vision 2036 aspirations to achieve high - income status and inclusive diversified growth. the thrust required is to galvanise efforts towards structural and economic transformation as well as harnessing opportunities enabled by the fourth industrial revolution by upscaling investment on digital infrastructure, adoption of ict and digital skills. global competitiveness reports suggest that botswana lags peer countries in this regard. this speaks to the need for accelerated digital transformation and pace of egovernment agenda to increase efficiency, the result of which should be easing of policy implementation constraints and focusing resources on more impactful programmes. comparative country studies and experiences suggest that deliberate promotion of large - scale industries and dedicated implementation of industrialisation policies would be instrumental to successful escape from the middle - income trap

’ s presentation will include an overview of structural features of the botswana economy, including the related challenges of slow progress on economic diversification, evidenced by continuing over - reliance on a single commodity for exports, government revenues and growth. notwithstanding the current environment of extreme volatility and uncertainty in global economy and markets, the presentation will also cover economic outlook for 2020 and prospects for recovery in 2021. it suffices for me to indicate that the locomotives of the botswana ’ s economic growth performance, namely, the diamond revenues and catalytical role of the government activities, would be severely constrained by macroeconomic the covid - 19 pandemic amidst shock which, according to a many commentators, is estimated to likely lead the global, regional and domestic economy into a recession of uncertain magnitude and duration ; most likely not experienced since the great depression of the 1930s. the third presentation will be a summary of the theme topic for the 2019 annual report, on “ central bank governance and functions in pursuit of price and financial stability ” by deputy director in the research and financial stability department, mr innocent molalapata. this theme topic is intended to explain the role of central banks in the economic management of any country, evolving institutional structures, mandates and objectives. among others, mr molalapata will highlight the importance and linkages of the triad of central bank operational autonomy, transparency and accountability in facilitating effective discharge of the central bank mandates and maintenance of macroeconomic stability, attainment of inclusive and sustainable economic growth. he will also reinforce the need for central bank adaptability in an environment of fast and disruptive developments in financial technology, aligned to the nation ’ s aspirations for digital transformation and knowledge - based economy. distinguished members of the media, in tying together the various strands out of the presentations to be delivered by my colleagues this morning, some key messages become apparent, clearly suggesting that the current growth model for botswana will, going forward, be difficult to sustain. first, that a key driver of economic and welfare prospects for botswana, namely, the export potential has, over the last few years, faltered and shrunk as a proportion of gdp ; therefore there is an urgent need for rejuvenation by redesigning the country ’ s industrial policies to promote exports and, given the size of the domestic market, to grow the private sector through a better integration into regional and global value chains. second and related thereto is that, despite the large public investment in infrastructure and related social spending by government, as