Withdrawal of Tax Incentives Contribute to Botswana’s Textile Industry Slope

Written by Makula Dunbar

May 31, 2013

The textile and apparel exports of Botswana, a landlocked country located in Southern Africa, may continue to decline due to the withdrawal of tax incentives by the US and the EU under the Financial Assistance Policy (FAP) as the country is depending on preferential tariffs, according to a research report by the Botswana Institute for Development Policy Analysis (BIDPA).

The research report prepared by Mr. Roman Grynberg and Mr. Masedi Motswapong of BIDPA states that Botswana’s textile and garment industry has benefitted from trade preferences and it remains to be seen whether the sector can survive without such preferences.

Botswana established the textile and clothing industry during the period 1980-90 and the sector expanded rapidly as a result of the trade preferences available to it under the Southern African Customs Union (SACU) agreement, the Cotonou agreement and the African Growth and Opportunity Act (AGOA).