In 1947, colonial authorities built a five-kilometre stretch of tar from the Lobatse railway station to the High Court in Boswelatlou. It was constructed for the visit of King George VI and Queen Elizabeth, who travelled through the then Bechuanaland Protectorate during a tour of southern Africa. For years that short strip remained one of the only tarred roads in the territory.
By the time Botswana gained independence in 1966, the country had fewer than 20 kilometres of paved roads, a population of roughly two million and an economy valued at barely $30 million. Few expected the newly independent state to thrive.
Instead, Botswana went on to become one of Africa’s most stable and fastest-growing economies, largely powered by diamonds. Mineral revenues funded highways, schools, hospitals, electricity networks and public institutions, allowing the government to shoulder much of the burden of infrastructure development.
That model is now under pressure. Volatile diamond markets, tighter fiscal conditions and the urgency of economic diversification are forcing Botswana to rethink how the next generation of infrastructure will be financed, structured and delivered.
The country’s current development strategy captures the scale of that challenge. Under the twelfth National Development Plan (NDP12), Botswana has outlined an ambitious infrastructure pipeline estimated at close to P400 billion between 2026 and 2030, spanning energy, transport corridors, water systems, logistics platforms and digital connectivity.
Much of this investment is expected to support the Botswana Economic Transformation Programme (BETP), which aims to accelerate diversification into manufacturing, non-diamond mining, logistics, tourism, agriculture and higher-value services.
Yet the scale of those ambitions raises a fundamental question: how will Botswana finance and execute infrastructure programmes of that magnitude at a time when public finances are more constrained and the old diamond-funded model is no longer enough?
For Standard Chartered Bank Botswana, the answer lies in a more deliberate combination of public investment, private capital, development finance, institutional savings and specialised structuring capacity.
The bank has increasingly positioned itself as one of the institutions able to connect Botswana’s local financing needs with regional and global pools of capital. Standard Chartered has operated in African markets for more than a century, giving it a long history in cross-border trade, infrastructure finance, mining finance, sustainable finance and capital markets. Globally, the bank’s network across more than 60 markets gives it access to investors, export credit agencies, development finance institutions, multinational corporates and financial markets that are often critical to large infrastructure transactions.
As highlighted by Chamu Mugangavari, Executive Director of Corporate and Investment Banking at Standard Chartered Bank Botswana, the country has several advantages that can help attract such capital if projects are properly prepared.
“Location is one of Botswana’s biggest advantages,” he says. “If you look at where Botswana sits on the map, it borders several countries in the region. That positioning gives the country real potential to become a logistics and processing hub.”
Governance is another factor investors weigh heavily when evaluating long-term infrastructure projects.“When investors look at where they can deploy capital, governance is a key consideration,” Mugangavari says. “They want to understand the legal framework, the policy environment and how predictable the system is.”
Botswana’s sovereign credit standing also strengthens its appeal.“There are very few investment-grade sovereigns in sub-Saharan Africa,” he says. “Botswana remains one of them, alongside Mauritius, and that matters because it lowers the cost of funding and opens access to pools of capital that may not be available to other markets.” Turning those advantages into economic growth, however, depends heavily on infrastructure.
The scale challenge
Infrastructure development in Botswana comes with a structural challenge: scale. With a population of just over 2.5 million people spread across a territory larger than France, distances between towns, mines, production centres and borders are vast. Connecting these areas requires long highways, extensive rail systems, power networks, water systems and logistics facilities.
“This is a country with a small population but very large distances,” Mugangavari says. “If you had to build a road that runs 400 kilometres or even 1,000 kilometres long, the capital cost becomes extremely high relative to the size of the economy.”
Those costs mean financing requirements are unusually large for a country of Botswana’s size. Historically, government funded most infrastructure expansion using diamond revenues. The next wave of development is likely to require greater participation from private investors, banks, pension funds, export credit agencies and development finance institutions.
This is where Standard Chartered says its role becomes more relevant. The bank’s Africa infrastructure view is built around the idea that governments cannot close the continent’s funding gap alone. The African Development Bank has estimated Africa’s infrastructure financing needs at about $170 billion annually, while the gap between what is needed and what is available remains large. Closing that gap requires blended finance, public-private partnerships and cross-border capital.
Standard Chartered has participated in such structures across the continent. In Angola, the bank helped facilitate financing for solar-powered electricity distribution infrastructure for off-grid communities, a programme valued at about €1.29 billion. It has also supported water infrastructure financing in Angola, including the Quiminha water project, which is expected to improve access to clean water for rural communities and support agricultural activity.
In Tanzania, Standard Chartered Tanzania acted as global coordinator, bookrunner and mandated lead arranger for a $1.46 billion term loan to fund a 550-kilometre Standard Gauge Railway project from Dar es Salaam to Makutupora. The railway is designed to connect Tanzania with Burundi, Rwanda and the Democratic Republic of Congo, strengthening regional trade routes and reducing freight service charges by an estimated 40 percent.
Infrastructure and economic growth
The connection between infrastructure and economic development is well established. Reliable transport networks, power supply, water systems and logistics platforms allow industries to operate efficiently, reach markets and expand production. Without them, economic activity slows and investment becomes harder to attract.
Mugangavari describes the relationship directly.“There is a direct correlation between infrastructure development and economic growth,” he says. “Without infrastructure, economic activity is muted.”
Mining illustrates the point clearly. Mineral deposits are often located far from towns, railways and ports, which means that extracting and exporting those resources depends on roads, rail, power and water. The richer the mineral opportunity, the more important the supporting infrastructure becomes.
“Where you find those deposits, they are often remote,” Mugangavari says. “You need very good rail and logistics networks to move those minerals.”
If infrastructure is weak, even promising projects may struggle to attract financing.“You may have a good concept for a project,” he says, “but poor infrastructure increases the risk and the cost of funding.”
That is especially important for Botswana’s next phase of mining. The country is trying to reduce its dependence on diamonds while expanding copper, coal, base metals and other mineral opportunities. Copper production has already become more visible through operations such as Khoemacau and Motheo, while renewed exploration has drawn attention to Botswana’s potential role in supplying minerals needed for electrification and the energy transition.
Across Africa, the mining finance challenge is also changing. The continent holds more than 30 percent of the world’s known mineral reserves and is central to the global supply of copper, cobalt, lithium, manganese, iron ore, platinum group metals and rare earths. Yet it attracts less than 10 percent of global exploration capital, limiting its ability to convert geological potential into bankable projects.
Standard Chartered’s Africa mining finance view is that bridging this gap requires commercial banks, DFIs, export credit and insurance agencies, private equity, institutional investors and alternative financing structures to work together. Mining projects are capital intensive, long dated and exposed to geological, construction, commodity price, regulatory and ESG risks. These risks often make conventional bank lending insufficient on its own, especially for early-stage and mid-tier projects.
Standard Chartered’s mining role in Botswana
Standard Chartered Bank Botswana is already deeply embedded in the country’s mining economy.
At the Future of Mining Summit 2025 in Gaborone, Standard Chartered Bank Botswana Chief Executive Officer Mpho Masupe described the bank as one of the largest financiers of Botswana’s mining industry and the largest financier to the diamond industry. He said the bank supports key players including Okavango Diamond Company, Debswana and Diamond Trading Company Botswana, and has extended more than $500 million in various credit facilities to the diamond industry to support infrastructure and trading.
Masupe also said the bank had extended more than $200 million in facilities used to support the clearing of sightholder sales and local value-chain participation, an area that is becoming more important as Botswana seeks to capture greater value from diamonds beyond mining.
He reiterated that Standard Chartered has one of the strongest global teams in base metals and precious stones, drawing on specialists in mining, mergers and acquisitions, ratings, economic research, sustainable finance, debt capital markets, investment banking and corporate finance. This expertise allows the bank to advise mining clients on capital structuring, credit ratings, sustainable finance, green frameworks, transition finance, sustainability-linked loans, trade finance, reserve-based lending, export credit agency financing and DFI-backed solutions.
The bank’s capability also extends to currency and trade corridors. Standard Chartered is the sole international bank in Botswana and holds a US dollar clearing licence, a key advantage for mining companies that depend on exports, offshore receipts, machinery imports and international buyers. It also provides correspondent banking services to other local and regional banks.
The bank has also introduced the Chinese renminbi as an onshore trading currency in Botswana, reflecting the growing importance of Chinese contractors, equipment suppliers and trade links in mining and infrastructure. Masupe said Standard Chartered is the largest renminbi clearing bank in Africa, giving Botswana companies access to financing that can better align with the currency of their procurement, especially where Chinese contractors or equipment suppliers are involved.
Building transport corridors
Transport infrastructure is central to Botswana’s diversification agenda. Efforts are already underway to strengthen road and rail connectivity across the country. Major road reconstruction and upgrade projects are being implemented on several corridors, including the Francistown–Nata highway, a key route linking northern Botswana with regional trade networks.
Other projects include upgrades to the Moshupa–Manyana road, improvements along the Ghanzi Junction–New Xade corridor and resurfacing work on sections of the national highway network.
These projects form part of a wider effort to improve connectivity between towns, production centres and border crossings while addressing years of wear on the national road system.
Rail infrastructure may prove even more transformative. Several rail corridor projects have been under discussion for years, many of them designed to strengthen Botswana’s links to regional ports and industrial centres.
Feasibility studies are nearing completion for the Mmamabula–Lephalale rail link, which would connect Botswana’s coal deposits to South Africa’s energy market. Another project under development is the Mosetse–Kazungula–Livingstone line, aimed at improving freight connectivity between Botswana and Zambia.
The much larger Trans-Kalahari Railway is also progressing through feasibility work. The proposed corridor would link Botswana’s mineral belt to Namibia’s port of Walvis Bay, providing a direct export route for bulk commodities such as coal, copper and iron ore. Estimated to cost around $16 billion, the project could significantly reshape regional trade routes if implemented.
These are the types of projects that require more than ordinary lending. They need feasibility work, traffic studies, bankable offtake arrangements, cross-border agreements, environmental and social safeguards, government support, and financing structures capable of bringing together many types of capital.
Standard Chartered’s experience in Tanzania’s railway financing is relevant in that context. The Tanzanian project showed how a bank can act not simply as a lender, but as a coordinator and arranger of a complex infrastructure facility that links national development priorities with international capital.
Energy and transition finance
Energy is another priority. Botswana’s vast land area and abundant sunshine create strong potential for solar power generation, particularly as the country works to strengthen electricity supply, reduce import dependence and support industrial development.
“There is a strong case for renewable energy,” Mugangavari says. “Botswana has excellent solar potential — large tracts of land and many hours of sunshine. That creates real opportunities for investment in solar generation.”
That potential has already begun to translate into utility-scale projects. At Mmadinare in eastern Botswana, Norwegian renewable energy company Scatec has developed a 120-megawatt solar power plant, one of the country’s first large-scale renewable energy facilities built through private investment.
Standard Chartered’s Africa mining finance approach places this within the wider transition-finance agenda. The bank sees opportunities in financing renewable power for mining operations, supporting sustainability-linked instruments, helping clients build green and transition finance frameworks, and structuring facilities that can align environmental goals with commercial investment.
Financing infrastructure at scale
The next challenge is financing. Infrastructure projects are typically too large for a single lender to finance alone. They rely on complex structures that combine funding from governments, commercial banks, development finance institutions, export credit agencies, institutional investors and private capital. Public-private partnerships are among the most common models.
“These projects are so large that often one financier cannot handle them alone,” Mugangavari says. “Public-private partnerships become essential because they allow governments, lenders and investors to share the risk.”
Infrastructure financing can also involve syndicated loans, private placements, guarantees, ECA facilities and participation by multilateral lenders. In some cases banks originate projects before distributing portions of the financing to other investors through what is known as an originate-to-distribute strategy.
A deeper financial system could further expand Botswana’s ability to finance such projects.“Infrastructure projects are typically long-term — sometimes 15 to 25 years — and banks cannot hold those assets on their balance sheets for that entire period because the capital cost becomes very punitive,” Mugangavari says.
Developing specialised infrastructure funds and broader capital-market instruments could therefore unlock additional pools of liquidity.
“The deeper the financial system is, the easier it becomes to mobilise savings — both retail and wholesale — and channel those funds into infrastructure projects,” he says.
Standard Chartered has been positioning itself around precisely this type of intermediation. It can arrange, structure, lend, bring in partner banks, connect with DFIs, support export credit structures and distribute assets to longer-term investors. That role is especially important in markets where domestic capital exists but does not always find its way into bankable infrastructure assets.
Masupe told the Future of Mining Summit that Standard Chartered was working on a syndication that would bring other local banks into the financing pool of one client, targeting up to $200 million in trade financing.
Mobilising domestic capital
International capital will be important, but Botswana also possesses substantial investment resources within its own financial system.
The country’s pension funds collectively had P166 billion in assets, making them one of the largest pools of long-term capital in the domestic economy. Infrastructure investments align naturally with the needs of these institutional investors.
“Pension funds are looking for long-dated assets,” Mugangavari says. “Infrastructure projects typically run for 15 to 20 years, which fits well with their investment horizon.”
Banks often play a bridging role by originating infrastructure loans before distributing portions of those investments to pension funds and other institutional investors.
“There is a natural synergy between banks and pension funds,” he says. “Banks originate the assets and pension funds become the long-term investors.”
However, deepening Botswana’s financial markets will be important if more of that capital is to remain invested domestically.
“If the financial system is not deep enough,” Mugangavari says, “those funds will naturally look outside Botswana for investment opportunities.”
Standard Chartered’s broader Africa view also recognises domestic pension and insurance funds as part of the financing equation, especially where local capital can reduce foreign-currency exposure. Foreign capital is necessary for large projects, but over-reliance on hard-currency debt can create repayment pressure when exchange rates move. Local-currency funding can help shield projects and companies from currency volatility, particularly where revenues are earned domestically.
The importance of bankable projects
Ultimately, attracting investment depends on turning infrastructure needs into bankable projects. That requires careful preparation, transparent regulatory frameworks, realistic demand projections and clear risk allocation among stakeholders. Sometimes the gap lies not in recognising infrastructure needs but in structuring projects in ways that meet investors’ expectations.
“There is often a difference between identifying a need and turning that need into a bankable project,” Mugangavari says.
A bankable project is not simply a good idea. It needs credible technical studies, reliable revenue streams, clear ownership, legal certainty, environmental and social approvals, procurement discipline and a financing plan that can withstand investor scrutiny.
Currency stability remains one of Botswana’s advantages.“Currency volatility is a major concern for investors in many markets,” Mugangavari says. “Botswana has generally maintained a relatively stable currency, which is positive for long-term investors.”
The challenge is to convert that macroeconomic credibility into executable projects. Investors may like Botswana’s governance record, location and investment-grade status, but capital will still flow only to projects whose risks are understood and whose returns are clear.
New funding models
Authorities are also exploring alternative ways to finance infrastructure. Among the options under consideration is the potential tolling of sections of the A1 highway, one of the country’s main transport corridors. Feasibility studies are underway to assess whether toll systems could provide sustainable funding for road maintenance and development.
Such user-pay models are widely used in other countries and could reduce pressure on public finances while ensuring long-term funding for road networks.
Institutional reforms may also help attract private investment. Plans are underway to restructure Botswana’s rail sector to create greater scope for private-sector participation, while reforms in aviation aim to separate regulatory oversight from operational management. These changes are designed to create clearer governance frameworks and encourage private investment in infrastructure development.
Botswana also plans to expand Maun International Airport into a wide-body capable gateway serving the tourism sector. Sir Seretse Khama International Airport is being positioned as a regional air cargo and logistics hub linked to nearby special economic zones. Improved aviation infrastructure could strengthen Botswana’s position as a logistics and transport hub within southern Africa.
The bank’s “connector” role, as Masupe described it, is to link Botswana to global markets, investors, trade corridors and financial solutions that can support that transition.
Execution speed
Even when financing is available, infrastructure projects can take years to materialise. Rail corridors, power plants and large highways require coordination across governments, financiers, contractors, regulators and communities. Execution speed therefore becomes critical.
“Capital is fungible,” Mugangavari says. “It will always chase the most attractive opportunities where the risk profile matches the expected return.”
If projects take too long to move forward, investors may allocate capital elsewhere. This is one of Botswana’s biggest risks. Many of the country’s strategic infrastructure projects have been discussed for years, but moving them through feasibility, procurement, financing and implementation has often proved difficult.
The opportunity cost is high. Delays in transport corridors can slow mining development. Delays in power projects can constrain industrialisation. Delays in water infrastructure can limit agriculture, tourism and settlement growth. Delays in logistics infrastructure can weaken Botswana’s ambition to become a regional hub.
Despite the challenges, Mugangavari remains optimistic.“The investors are there,” he says. “The key is developing bankable projects and moving them forward.”
The next chapter
Nearly eight decades after that ceremonial road was built in Lobatse, Botswana’s infrastructure ambitions have grown enormously. The projects envisioned under NDP12, from rail corridors and solar plants to highways, airports, water systems and logistics hubs, could reshape trade routes, support industrial development and position Botswana at the centre of southern Africa’s regional economy.
But ambition will not be enough. Botswana’s next phase of growth will depend on whether it can prepare projects properly, mobilise domestic savings, attract global capital, deepen its financial system and work with institutions capable of structuring large, long-term transactions.
Standard Chartered Bank Botswana sees itself playing that role, not only as a lender, but as a connector between Botswana and global capital, between mining companies and international markets, between domestic institutions and long-term infrastructure assets, and between policy ambition and bankable execution.
As Botswana seeks to move beyond diamond dependence, infrastructure may become the platform on which the next economy is built. The railways, energy networks, airports, roads, water systems and digital corridors now under discussion could determine whether Botswana remains a resource exporter or becomes a more diversified logistics, mining, processing and services hub.
If those ambitions are realised, Botswana’s next growth story may not be written in mining only. It may be built through the infrastructure that connects its resources, people and industries to a rapidly changing African and global economy.
