Since the discovery of diamonds in the early 1970s, Botswana has experienced phenomenal
growth levels by world standards, with annual growth rates averaging 9% between 1966 and
2002. Growth rates fell to about 7.7% between 2003 and 2006 and have been below 5% in
recent years due to the global financial crisis (Government of Botswana, 2010). Other factors
such as fiscal discipline and sound economic management have also helped Botswana
transform itself from one of the poorest countries in the world to a middle income country
with a per capita GDP of $16,300 in 2011. Poverty has also declined significantly over the
years. The consecutive Household Income Expenditure Surveys (HIES) undertaken in
1985/86, 1993/94, 2002/03 and the Botswana Core Welfare Indicator Survey of 2009/10
indicate that the portion of the population living below the poverty line were 59%, 47%, 30%
and 20% respectively. The fall in poverty has not been accompanied by a decline in
inequality. The HIES data shows that income inequality has worsened over the 1993/94 to
2002/03 period, with the Gini coefficient of disposable income increasing from 0.537 to
0.573, respectively.