Two sets of issues loom large on the economic horizon of Botswana: The issue ofdiversification of the economy away from the mineral sector to other non-traditional sectorsand that concerning the income and equity effects of trade liberalisation. In this paper,simulations with a Computable General Equilibrium (CGE) model of Botswana are used toanalyse aspects of these issues. The primary database used is a 1993/94 Social AccountingMatrix (SAM) for Botswana. To capture these policy changes the trade liberalisation policysimulations, were run to compare scenarios where, as a result of WTO, tariffi are loweredsignificantly. In general the analysis revealed that the trade liberalisation strategy may havea positive impact on most of the sectors of the economy. These results were influenced bythe closure conditions, the elasticity assumptions and the fact that production level of themineral sector is fixed in the model. The reason for fixing production of the minerals sector isto reflect the fact that the mineral sector is the largest sector in the economy and thus to allowthe model to capture the impact of external trade shocks on other sectors of the economy. Theinfluence of the mineral sector on the economy need to be restricted

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