{
  "title": "Exchange Rate Assessment in a Resource-Dependent Economy: The Case of Botswana",
  "publication": "IMF Working Papers, March 1, 2008",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/31/exchange-rate-assessment-in-a-resource-dependent-economy-the-case-of-botswana-21833",
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  "summary": "The paper combines various methodologies to assessing the level of the exchange rate in Botswana, explicitly taking into account the implications of its dependency on diamond exports.",
  "sections": [
    {
      "heading": "Summary of approach",
      "content": "- Combines various methodologies to assess the level of the exchange rate in Botswana, explicitly taking into account the implications of its dependency on diamond exports.\n- Real exchange rate estimation and projected external balances are evaluated together to assess consistency with long-term external sustainability."
    },
    {
      "heading": "Key findings",
      "content": "- Real exchange rate estimation indicates that, after a period of overvaluation, Botswana's real effective exchange rate is now broadly in line with economic fundamentals.\n- The projected current account path is consistent with external sustainability, defined to ensure sufficient savings of diamond wealth in order to maintain a stable import and consumption path through 2050.\n- Sustaining consumption over the longer term will require addressing obstacles to non-diamond exports' competitiveness."
    },
    {
      "heading": "Policy implications and recommendations",
      "content": "- Preserve sufficient savings of diamond wealth to maintain a stable import and consumption path through 2050.\n- Strengthen policies and reforms to improve the competitiveness of non-diamond exports to sustain consumption and diversification over the longer term."
    },
    {
      "heading": "Subjects and keywords (as provided)",
      "content": "- Subjects: Current account, Exchange rates, Exports, Real effective exchange rates, Real exchange rates\n- Keywords: exchange rate, GDP, REER, WP\n\nSource: Exchange Rate Assessment in a Resource-Dependent Economy: The Case of Botswana (IMF Working Paper by Corinne C Delechat and Matthew Gaertner, March 1, 2008).\n\n---\n\n Content in this bundle\n\n- wp0883\n  - wp0883 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - wp0883 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/exchange-rate-assessment-in-a-resource-dependent-economy-the-case-of-botswana-21833"
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    "Authors: Corinne C Delechat, Matthew Gaertner",
    "Published: March 1, 2008",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451869446.001",
    "Combines various methodologies to assess the level of the exchange rate in Botswana, explicitly taking into account the implications of its dependency on diamond exports.",
    "Real exchange rate estimation and projected external balances are evaluated together to assess consistency with long-term external sustainability.",
    "Real exchange rate estimation indicates that, after a period of overvaluation, Botswana's real effective exchange rate is now broadly in line with economic fundamentals.",
    "The projected current account path is consistent with external sustainability, defined to ensure sufficient savings of diamond wealth in order to maintain a stable import and consumption path through 2050.",
    "Sustaining consumption over the longer term will require addressing obstacles to non-diamond exports' competitiveness.",
    "Preserve sufficient savings of diamond wealth to maintain a stable import and consumption path through 2050.",
    "Strengthen policies and reforms to improve the competitiveness of non-diamond exports to sustain consumption and diversification over the longer term.",
    "Subjects: Current account, Exchange rates, Exports, Real effective exchange rates, Real exchange rates",
    "Keywords: exchange rate, GDP, REER, WP",
    "**_wp0883**"
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