The local GDP grew, powered by the financial sector

Good morning, let’s get into it!

The numbers are in for the third quarter of 2025, and while the broader economy is shifting, the service sector is telling a fascinating story of resilience and rotation.

In this edition, we are diving deep into the performance of Botswana’s service industries—specifically looking at Figures 11 through 16 from the latest Statistics Botswana GDP report. If you are tracking market movements or looking for sectors with momentum, here is what you need to know.

The Star Performer: Finance is Firing Up

If there is one clear winner this quarter, it is the financial sector. Finance, Insurance, and Pension Funding grew by 5.2%, accelerating from the 4.2% growth seen in the same period last year.

This wasn't just a general lift; the engine room was Central Banking, which surged by 8.7%, followed closely by Monetary Intermediation & Financial Services at 6.9%. For investors, this signals robust financial activity and perhaps a tightening or deepening of monetary operations that is generating value. While other sectors cooled, finance heated up.

Tourism & Hospitality: Holding Steady

The post-pandemic recovery momentum is stabilizing into steady growth. Accommodation and Food Services posted a solid 4.6% increase. While this is a slight moderation from last year’s 5.4%, the underlying numbers are healthy:

• Accommodation services grew by 5.4%.

• Food services grew by 3.2%.

• Supporting this trend, the Administrative and Support Services sector (which includes travel agencies and tour operators) grew by 3.2%. Notably, Tour Operators specifically saw a 0.6% rise. It’s not explosive growth, but it is consistent—a good sign for the stability of our tourism product.

The Tech Slowdown (With a Silver Lining)

The Information and Communications Technology (ICT) sector has tapped the brakes. After flying high with 5.7% growth in Q3 2024, the sector slowed to 1.3% this quarter.

However, don't write off the sector just yet. Beneath the surface, Computer Programming & Information Services activities bounced back into positive territory with 1.9% growth, recovering from a decline in the previous year. This suggests a potential pivot where growth is moving from general infrastructure (like telecom) toward specialized tech services and software development.

Real Estate & Professional Services: Moderate Gains

The Real Estate sector remains a steady, if unspectacular, performer, growing by 2.8%. The driver here is purely services (rentals, sales), which were up 3.4%. Interestingly, property loans decreased by 0.8%, suggesting that while people are trading and renting, leverage and new financing might be tightening.

Similarly, Professional, Scientific, and Technical Activities (think lawyers, accountants, and consultants) grew by 3.1%. This represents a slight dip from last year’s 3.8%, reflecting a business environment that is expanding, albeit more cautiously.

The Bottom Line

The Q3 2025 data shows a "multi-speed" service economy.

• Bullish: Financial services are accelerating.

• Stable: Hospitality and Real Estate are churning out reliable, moderate growth.

• Watchlist: ICT is cooling off, but the shift toward programming services could be the spark for the next wave of tech value.

For BSE and private investors, the banking and financial services sector appears to be the current heavy lifter. Keep an eye on those banking stocks!

Source: Statistics Botswana