Botswana’s $504m AfDB loan backs a renewable auction and universal access by 2030

The African Development Bank has approved a $503.75 million loan for Botswana’s Economic Competitiveness and Transformation Support Programme, co-financed with $170 million from the OPEC Fund, tying reforms to a competitive renewable energy auction and a costed plan to bring every household onto electricity by 2030.

Botswana will expand its fuel depot at Francistown from 38 million litres of storage to 98 million litres, one of the energy measures in a reform programme the African Development Bank (AfDB) is supporting with a $503.75 million loan.

A fully costed National Electrification Action Plan is to take household electricity access from 79.5% in 2025/26 to universal access by 2030, advancing Botswana’s National Energy Compact under Mission 300, and the country will hold at least one competitive renewable energy auction inviting private developers to build new solar and wind capacity, the bank said.

The OPEC Fund is contributing $170 million alongside the AfDB, and the loan is the first phase of a two-year programme covering 2026/27 and 2027/28, with targets for non-mining tax revenue of 11.8% of GDP in 2027/28 and expanded support for small businesses. Botswana’s economy contracted by 2.8% in 2024 and 0.7% in 2025 during a prolonged downturn in the diamond market, which accounts for about 30% of its GDP and nearly 80% of its exports, and the bank said higher energy costs linked to the conflict in the Middle East had added to the pressure.

“Our role is to help finance the adjustment, while protecting those least able to bear its costs,” said Moono Mupotola, the AfDB’s deputy director-general for Southern Africa.

Botswana’s Economic Transformation Programme has a pipeline of 186 projects worth P514 billion, with a goal of 512,000 jobs by 2036. The AfDB programme itself targets 3,292 active small businesses and 3,935 direct jobs by 2027/28.