President Mokgweetsi Masisi was among the attendees at the 24th Conference of Parties on Climate Change (COP24) held in Katowice Poland last week, where the rules for implementation of the Paris Agreement on climate change under the Paris Agreement work programme (PAWP) were finalised.
As the world engages on this serious conversation, to gather ideas and formulate policies and mitigation measures on how to collectively combat the globe’s greatest threat ever in centuries, Botswana has also joined the bandwagon. Botswana as a landlocked semi-arid country has been underscored as one of the African countries particularly in the Southern African region that could be adversely impacted by the catastrophic effects of this increasingly concerning pandemic.
World leaders amongst them Heads of States, researchers and key decision makers gathered at this high-level meeting to come up with practical measures against increasing global warming and depletion of ozone layer amongst others. President Masisi was accompanied by senior government officials. The largest human influence of global warming and undesirable climate change has been noted to emission of greenhouse gases such as carbon dioxide, methane, and nitrous oxide.
Botswana which is not yet an intensively industrial country, emissions are said to be by in large linked to Singapore and Japanese import vehicles which have been coming into Botswana in large number over the recent years. When addressing a press conference upon his arrival from Poland last Thursday, Masisi shared that his government would in the near future regulate the entry of the popular import cars.
He explained that government is currently in consultation with environmental experts, researchers and all stakeholders to assess the impacts of import car emissions into Botswana skies and its contribution to climate change. He said in turn “legislation would be put in place if deemed necessary to regulate with a view to contain and reduce the number these used imports entering Botswana Boarders.”
Still last week in Poland experts warned that global warming of 1.5 degrees Celsius and higher will mean even greater warming and damaging impacts for climate change ‘hotspots’ in the Southern Africa region underscoring Botswana and Namibia. The two countries are constantly noted as highly vulnerable to climate stresses with observers suggesting it was key for authorities in these respective countries to appreciate how surpassing the 1.5 degrees Celsius global limit will play out at the local level.
“For these hot, dry and water-stressed countries, local warming and drying will be greater than the global average. So, even a 1.5°C increase in global temperature will have severe local impacts, ushering in intensified and longer droughts and many more heat waves. Ironically, when rain does fall, it is expected to be much heavier, increasing the risk of heavy flooding within an overall drying climate,” said a renowned International Researchers Mark New and Brendon Bosworth in their recent report.
These researchers noted that with the prospect of worsening droughts, floods and other weather extremes on the horizon, the sooner southern African countries can prepare and implement adaptation strategies the better. Changes in rainfall are also projected to shift. At 1.5°C of global warming, experts say Botswana would receive 5 percent less annual rainfall, and Namibia 4 percent less. At 2.0°C global warming, annual rainfall in Botswana would drop by 9 percent, with annual rainfall in Namibia dropping by 7 percent.
Various analysts and commentators note that the impacts of higher global and local temperatures will be felt in various sectors key to the prosperity of people and economies in Botswana and Namibia. “Understanding when different levels of warming will occur, and what these mean for threats to vulnerable sectors like agriculture, health and water, is crucial for adaptation planning and thinking about what must be done, and by when,” says Brendon Bosworth an Environmentalist at the University of Cape Town.
In a hotter, drier future there will be less domestic water available. Runoff in Botswana’s Limpopo catchment is projected to decline by 26 percent at 1.5 degrees Celsius global warming, and by 36 percent at 2.0 degree Celsius. Agriculture is particularly vulnerable, with potential drops in crop yields and increased livestock losses. In Botswana, at 1.5 degrees Celsius global warming maize yields could drop by over 20 percent.
At 2.0 degrees Celsius warming, yields could slump by 35 percent. Rain-fed agriculture is already marginal across much of the country, and anticipated climate change may well make current agricultural practices unviable at 1.5 a degrees Celsius and above. “It is clearly evident that the greatest threat to economic prosperity and humankind as a whole is the adverse effect of climate change. It is, therefore, highly prudent that we are awakened to create a new era of global green growth. The time is now and not tomorrow,” said University of Botswana Vice Chancellor Professor Norris recently at a climate change workshop.
It has been underscored that Botswana urgently needs policies to facilitate climate change adaptation to protect the its tourist attraction sites amongst other the Okavango Delta, the country's most lucrative tourist. Tourism is Botswana’s second foreign income earner and contributor to GDP employing directly and indirectly over 25 000 people. The Okavango Delta which received UNESCO tag about 2 years ago is one of the country’s major tourist attraction landscapes with aesthetic sceneries watershed ecologies and breath-taking experience of leisure and relaxation.
Wame Hambira, from the Department of Environmental Science at the University of Botswana warned in the International Journal for Tourism Policy that that unless government policies take account of current and forecasted climate shifts, the tourism sector could be badly damaged, with serious implications for the wider economy.
"The declining precipitation and increasing temperatures have implications for the amount of inflow into the delta," she said adding that reduced inflow could result in swamps drying out and forests being replaced by grasslands, as a result, local animal species would either become extinct or move away, with catastrophic implications for tourism.
This century is always looking at improving new super high speed technology to make life easier. On the other hand, beckoning as an emerging fierce reversal force to equally match or dominate this life enhancing super new tech, comes swift human adversaries which seem to have come to make living on earth even more difficult.
The recent discovery of a pandemic, Covid-19, which moves at a pace of unimaginable and unpredictable proportions; locking people inside homes and barring human interactions with its dreaded death threat, is currently being felt.
Member of Parliament for Kanye North, Thapelo Letsholo has cautioned Government against excessive borrowing and poorly managed debt levels.
He was speaking in Parliament on Tuesday delivering Parliament’s Finance Committee report after assessing a motion that sought to raise Government Bond program ceiling to P30 billion, a big jump from the initial P15 Billion.
Government Investment Account (GIA) which forms part of the Pula fund has been significantly drawn down to finance Botswana’s budget deficits since 2008/09 Global financial crises.
The 2009 global economic recession triggered the collapse of financial markets in the United States, sending waves of shock across world economies, eroding business sentiment, and causing financiers of trade to excise heightened caution and hold onto their cash.
The ripple effects of this economic catastrophe were mostly felt by low to middle income resource based economies, amplifying their vulnerability to external shocks. The diamond industry which forms the gist of Botswana’s economic make up collapsed to zero trade levels across the entire value chain.
The Upstream, where Botswana gathers much of its diamond revenue was adversely impacted by muted demand in the Midstream. The situation was exacerbated by zero appetite of polished goods by jewelry manufacturers and retail outlets due to lowered tail end consumer demand.
This resulted in sharp decline of Government revenue, ballooned budget deficits and suspension of some developmental projects. To finance the deficit and some prioritized national development projects, government had to dip into cash balances, foreign reserves and borrow both externally and locally.
Much of drawing was from Government Investment Account as opposed to drawing from foreign reserve component of the Pula Fund; the latter was spared as a fiscal buffer for the worst rainy days.
Consequently this resulted in significant decline in funds held in the Government Investment Account (GIA). The account serves as Government’s main savings depository and fund for national policy objectives.
However as the world emerged from the 2009 recession government revenue graph picked up to pre recession levels before going down again around 2016/17 owing to challenges in the diamond industry.
Due to a number of budget surpluses from 2012/13 financial year the Government Investment Account started expanding back to P30 billion levels before a series of budget deficits in the National Development Plan 11 pushed it back to decline a decline wave.
When the National Development Plan 11 commenced three (3) financial years ago, government announced that the first half of the NDP would run at budget deficits.
This as explained by Minister of Finance in 2017 would be occasioned by decline in diamond revenue mainly due to government forfeiting some of its dividend from Debswana to fund mine expansion projects.
Cumulatively since 2017/18 to 2019/20 financial year the budget deficit totaled to over P16 billion, of which was financed by both external and domestic borrowing and drawing down from government cash balances. Drawing down from government cash balances meant significant withdrawals from the Government Investment Account.
The Government Investment Account (GIA) was established in accordance with Section 35 of the Bank of Botswana Act Cap. 55:01. The Account represents Government’s share of the Botswana‘s foreign exchange reserves, its investment and management strategies are aligned to the Bank of Botswana’s foreign exchange reserves management and investment guidelines.
Government Investment Account, comprises of Pula denominated deposits at the Bank of Botswana and held in the Pula Fund, which is the long-term investment tranche of the foreign exchange reserves.
In June 2017 while answering a question from Bogolo Kenewendo, the then Minister of Finance & Economic Development Kenneth Mathambo told parliament that as of June 30, 2017, the total assets in the Pula Fund was P56.818 billion, of which the balance in the GIA was P30.832 billion.
Kenewendo was still a back bench specially elected Member of Parliament before ascending to cabinet post in 2018. Last week Minister of Finance & Economic Development, Dr Thapelo Matsheka, when presenting a motion to raise government local borrowing ceiling from P15 billion to P30 Billion told parliament that as of December 2019 Government Investment Account amounted to P18.3 billion.
Dr Matsheka further told parliament that prior to financial crisis of 2008/9 the account amounted to P30.5 billion (41 % of GDP) in December of 2008 while as at December 2019 it stood at P18.3 billion (only 9 % of GDP) mirroring a total decline by P11 billion in the entire 11 years.
Back in 2017 Parliament was also told that the Government Investment Account may be drawn-down or added to, in line with actuations in the Government’s expenditure and revenue outturns. “This is intended to provide the Government with appropriate funds to execute its functions and responsibilities effectively and efficiently” said Mathambo, then Minister of Finance.
Acknowledging the need to draw down from GIA no more, current Minister of Finance Dr Matsheka said “It is under this background that it would be advisable to avoid excessive draw down from this account to preserve it as a financial buffer”
He further cautioned “The danger with substantially reduced financial buffers is that when an economic shock occurs or a disaster descends upon us and adversely affects our economy it becomes very difficult for the country to manage such a shock”