An appraisal of the quality of Botswana’s institutions in supporting the privatisation programme

Abstract

This paper examines whether Botswana’s institutions of property rights are strong enough to promotepositive outcomes of the country’s privatisation programme. International experience has shown thatwhere institutions are weak or non-existent, privatisation is likely to result in sub-optimal outcomes.Our assessment is based on a review of empirical literature and evidence provided by internationalindices that measure institutional quality. The evidence shows that Botswana’s institutions are fairlystrong and could support privatisation. The evidence also shows Botswana to be fairly strong in thelegal and political environment, and protection of physical property rights. However, protection ofintellectual property rights is shown to be very weak, particularly patent protection which is shown tobe non-existent and protection against copyright piracy also leaves a lot to be desired. Policy responseis recommended to strengthen these aspects. Strengthening of these aspects is not only important forsupporting privatisation, but for encouraging innovation and new investment in the economy which iscritical for private sector growth.