LibertyFest, helmed by Brisbane based ‘do’-tank LibertyWorks, brought together speakers and guests from a wide variety of backgrounds to engage with dangerous and disruptive ideas. These ideas were discussed in association with one core belief; that all men (and women) are born equal. The conference speakers explored a range of topics, from liberalism in developing nations to free speech, indigenous affairs, climate change and economics.
Particularly interesting to me was the talk Models of Success: Lessons in Liberty from Botswana presented by Graham Young, Executive Director of the Australian Institute for Progress. Young’s talk posited a simple idea, that free-market economic principles will lead nations to success. In Botswana, the adoption of these principles, and their nations emphasis on personal freedoms and liberty is a natural case study which proves that free market principles are the most successful method of bringing countries out of poverty, and into the fore of economic success.
In practice, much of Botswana’s success can be attributed to the market principles it has applied. Personal taxation is a progressive system capped at 25%, while company tax is capped at between 15-25%, depending on the company. The business-friendly government actively courts outside investors, providing a low regulatory environment. There are no foreign exchange controls and the national currency is massively undervalued. Free trade areas exit with other African nations, the EU and the United States. The nation is characterised by its stability, predictability and transparent governance.
When it became independent in 1966, Botswana was among the 25 most impoverished nations in the world. In 2018, Botswana has the fourth highest gross national income at purchasing power parity in Africa, despite being only the 42nd largest by population. It has been able to maintain a stable representative democracy and holds the best-perceived corruption ranking in Africa since 1998. Ranked 28th in the Economist’s Intelligence Unit’s Democracy Index, it holds the highest rank of all African nations, and above France who sits at number 29.
That is not to say there aren’t issues. Like many African nations, Botswana has been hard hit by the AIDs epidemic, with 22% of the population being afflicted by HIV or AIDS. There are also economic issues, such as the sustainability of Botswana’s diamond industry which provides an economic backbone to the nation currently but is by no means a long-term panacea.
However, with 5.8bn in foreign reserves, Botswana has both the financial ability and the economic framework to maintain success. I found Young’s talk to be incredibly persuasive. Nations like Botswana provide a very tangible example of how free markets, when left to operate without unnecessary government intervention or interference, are the most effective way of lifting individuals out of poverty.