The Minister of Investment, Trade and Industry Bogolo Kenewendo has revealed that the ministry has initiated a process that look into the possibility of merging various quasi-government enterprises owing to duplication and overlapping of mandates.
There have been calls from various quarters, including legislators and the business community over the need to merge some ministries in a bid to improve efficiency and profitability. “It has been observed that the mandates of some of the parastatals are converging resulting in some overlaps and duplications,” said Kenewendo, who was appointed as a trade minister at the beginning of April.
“A rationalisation exercise is ongoing in that regard, and the exercise will go a long way in eliminating duplication of efforts across the ministry’s parastatals where existent, culminating in improved service quality,” While a backbencher, Kenewendo had made her believes known that a number of parastatals do have overlapping mandates therefore requiring a rationalisation that would produce efficiency.
Parastatals that have been under microscope include Citizen Entrepreneurial Development Agency (CEDA), Botswana Development Corporation (BDC), as well as National Development Bank (NDB) which are government owned funding institutions. BDC was established in 1970, as government investment arm and as main agency for commercial and industrial development. BDC’s primary mandate is to drive the industrialisation of the country by providing financial assistance to investors with commercially viable projects.
BDC provides both debt and equity financing to commercially viable projects that perform one or more of the following functions; pioneer new industries; unlock value in existing industries, stimulate private sector growth and foster linkages with the local industry, drive diversification and exports, and create significant employment. Meanwhile CEDA, which was created in 2001, has been mandated to provide financial and technical support for business development with a view to promote viable and sustainable citizen owned business enterprises.
CEDA was is established to address the need for coherent and holistic support for the development of small, medium and large scale enterprises through the soft window and package offered through the subsidiaries. CEDA offers funding for capital expenditure, stock or working capital in new and existing business ventures. It also offers training and mentoring for new and seasoned entrepreneurs and business advisory services to entrepreneurs in various skills as identified through the needs assessment that is conducted during project monitoring.
The monitoring, business advisory is also carried out by Local Enterprise Authority (LEA) another parastatal formed in 2004. According to the Small Business Act , which established the entity, LEA’s mandate is to promote entrepreneurship and SMME development through; providing business development services inter alia through; screening, business plan facilitation, training and mentoring as well as identifying business opportunities for existing and future SMMEs among others.
While NBD, the oldest of them all was established in 1963 during the colonial era, with a mandate to provide sustainable value creating financial services and partnerships that support economic development of the country. NDB has recently been going through a difficult financial phase. Few weeks ago, the beleaguered bank approached the Parliamentary Committee on Public Enterprises and Statutory Bodies to lobby for government recapitalisation.
EFFICIENCY AND PROFITABILITY: CASE FOR PARASTATAL S MERGER
In 2016, while speaking Grant Thornton Private Growth Business Awards, former cabinet minister, Charles Tibone indicated his lack of faith in the public enterprises in terms of their growth potential owing to their continued non-performance. “What is even more concerning is that the majority of these parastatals businesses are chronically unprofitable. They operate on negative returns on investment or on life support from Government through subsidies,” he said then.
“A case can be made for parastatals that provide a social service like Water Utilities Corporation (WUC) or those which regulate sectors such as Botswana Communication Regulatory Authority (BOCRA) or Civil Aviation Authority (CAAB).” Tibone does not see any reason for government to continue keeping public enterprises which have become weak after being owned by government for decades.
“One may ask; do we really need a national airline? Have we not done enough to demonstrate that passenger traffic exists? Nigeria, The United States of America, Hong Kong and many other countries do not have national airlines and yet traffic into these states remains strong,” he said. “Is it vital that National Development Bank (NDB), Botswana Development Corporation (BDC), Botswana Savings Bank (BSB) and Botswana Meat Commission (BMC), to mention just a few, should continue to be Government owned?”
Tibone, who resigned as Assistant Minister of Finance in 2011, and left his law making position in 2014, argued that if compared, growth profiles of the BDC and BIHL, both of which are in property and financial services, among other investments, one will notice that one zigzags up and down while the other has an upward trajectory. “It will not be difficult to guess which one is parastatal,” he said.
“Massive injection of state resources into that entity has not guaranteed growth. This evidence therefore leads one to the observation that there is a distinct prospect that the privatisation of a number of Government parastatals would not simply lead to quantitative growth of our private sector but possibly a dramatic transformation of our economy.”
The Botswana Power Corporation (BPC) has taken a significant step towards diversifying its energy mix by signing a power purchase agreement with Sekaname Energy for the production of power from coal bed methane in Mmashoro village. This agreement marks a major milestone for the energy sector in Botswana as the country transitions from a coal-fired power generation system to a new energy mix comprising coal, gas, solar, and wind.
The CEO of BPC, David Kgoboko, explained that the Power Purchase Agreement is for a 6MW coal bed methane proof of concept project to be developed around Mmashoro village. This project aligns with BPC’s strategic initiatives to increase the proportion of low-carbon power generation sources and renewable energy in the energy mix. The use of coal bed methane for power generation is an exciting development as it provides a hybrid solution with non-dispatchable sources of generation like solar PV. Without flexible base-load generation, the deployment of non-dispatchable solar PV generation would be limited.
Kgoboko emphasized that BPC is committed to enabling the development of a gas supply industry in Botswana. Sekaname Energy, along with other players in the coal bed methane exploration business, is a key and strategic partner for BPC. The successful development of a gas supply industry will enable the realization of a secure and sustainable energy mix for the country.
The Minister of Minerals & Energy, Lefoko Moagi, expressed his support for the initiative by the private sector to develop a gas industry in Botswana. The country has abundant coal reserves, and the government fully supports the commercial extraction of coal bed methane gas for power generation. The government guarantees that BPC will purchase the generated electricity at reasonable tariffs, providing cash flow to the developers and enabling them to raise equity and debt funding for gas extraction development.
Moagi highlighted the benefits of developing a gas supply industry, including diversified primary energy sources, economic diversification, import substitution, and employment creation. He commended Sekaname Energy for undertaking a pilot project to prove the commercial viability of extracting coal bed methane for power generation. If successful, this initiative would unlock the potential of a gas production industry in Botswana.
Sekaname Energy CEO, Peter Mmusi, emphasized the multiple uses of natural gas and its potential to uplift Botswana’s economy. In addition to power generation, natural gas can be used for gas-to-liquids, compressed natural gas, and fertilizer production. Mmusi revealed that Sekaname has already invested $57 million in exploration and infrastructure throughout its resource area. The company plans to spend another $10-15 million for the initial 6MW project and aims to invest over $500 million in the future for a 90MW power plant. Sekaname’s goal is to assist BPC in becoming a net exporter of power within the region and to contribute to Botswana’s transition to cleaner energy production.
In conclusion, the power purchase agreement between BPC and Sekaname Energy for the production of power from coal bed methane in Mmashoro village is a significant step towards diversifying Botswana’s energy mix. This project aligns with BPC’s strategic initiatives to increase the proportion of low-carbon power generation sources and renewable energy. The government’s support for the development of a gas supply industry and the commercial extraction of coal bed methane will bring numerous benefits to the country, including economic diversification, import substitution, and employment creation. With the potential to become a net exporter of power and a cleaner energy producer, Botswana is poised to make significant strides in its energy sector.
It is not clear as to when, but before taking a festive break in few weeks’ time UDC leaders would have convened to address the ongoing deadlock surrounding constituency allocation in the negotiations for the 2024 elections. The leaders, Duma Boko of the UDC, Mephato Reggie Reatile of the BPF, and Ndaba Gaolathe of the AP, are expected to meet and discuss critical matters and engage in dialogue regarding the contested constituencies.
The negotiations hit a stalemate when it came to allocating constituencies, prompting the need for the leaders to intervene. Representatives from the UDC, AP, and BPF were tasked with negotiating the allocation, with Dr. Patrick Molotsi and Dr. Philip Bulawa representing the UDC, and Dr. Phenyo Butale and Wynter Mmolotsi representing the AP.
The leaders’ meeting is crucial in resolving the contentious issue of constituency allocation, which has caused tension among UDC members and potential candidates for the 2024 elections. After reaching an agreement, the leaders will engage with the members of each constituency to gauge their opinions and ensure that the decisions made are favored by the rank and file. This approach aims to avoid unnecessary costs and conflicts during the general elections.
One of the main points of contention is the allocation of Molepolole South, which the BNF is adamant about obtaining. In the 2019 elections, the UDC was the runner-up in Molepolole South, securing the second position in seven out of eight wards. Other contested constituencies include Metsimotlhabe, Kgatleng East and West, Mmadinare, Francistown East, Shashe West, Boteti East, and Lerala Maunatlala.
The criteria used for constituency allocation have also become a point of dispute among the UDC member parties. The issue of incumbency is particularly contentious, as the criterion for constituency allocation suggests that current holders of UDC’s council and parliamentary seats should be given priority for re-election without undergoing primary elections. Disadvantaged parties argue that this approach limits democratic competition and hinders the emergence of potentially more capable candidates.
Another disputed criterion is the allocation based on the strength and popularity of a party in specific areas. Parties argue that this is a subjective criterion that leads to disputes and favoritism, as clear metrics for strength and visibility cannot be defined. The BNF, in particular, questions the demands of the new entrants, the BPF and AP, as they lack a traceable track record to support their high expectations.
The unity and cohesion of the UDC are at stake, with the BPF and AP expressing dissatisfaction and considering withdrawing from the negotiations. Therefore, it is crucial for the leaders to expedite their meeting and find a resolution to these disputes.
In the midst of these negotiations, the BNF has already secured 15 constituencies within the UDC coalition. While the negotiations are still ongoing, BNF Chairman Dr. Molotsi revealed that they have traditionally held these constituencies and are expecting to add more to their tally. The constituencies include Gantsi North, Gantsi South, Kgalagadi North, Kgalagadi South, Good Hope – Mmathethe, Kanye North, Kanye South, Lobatse, Molepolole North, Gaborone South, Gaborone North, Gaborone Bonnignton North, Takatokwane, Letlhakeng, and Tlokweng.
The resolution of the contested constituencies will test the ability of the UDC to present a united front in the 2024 National Elections will depend on the decisions made by the three leaders. It is essential for them to demonstrate maturity and astuteness in resolving the constituency allocation deadlock and ensuring the cohesion of the UDC.
In Botswana, the Constitution Section 5 (3) (b) provides that conditions of bail are necessary to ensure that an accused appears at a later date for trial or for proceedings preliminary to trial. These conditions may include restrictions on interfering with state witnesses, the payment of a certain amount, the provision of sureties, the submission of travel documents, reporting to the police regularly, and appearing for all court mentions or proceedings. Failure to abide by these conditions can result in the revocation of bail. Robert Seditseng, a murder accused who has been detained since 2016, is currently facing the consequences of not adhering to his bail conditions – therefore paying the piper.
Despite numerous unsuccessful bail applications over the past five years, Gaborone High Court judge Michael Leburu denied Seditseng bail this week. Seditseng had requested to be set free before his trial starts on April 12th, but his freedom will now depend on the verdict. He is charged with the murder of his girlfriend, Siscah Mutukee, on June 22nd, 2016, in Charleshill.
Judge Leburu ruled that Seditseng is not a candidate for bail due to being a flight risk, as he has previously absconded from court. Defense lawyer David Ndlovu pleaded with the court to consider the time Seditseng has already spent in prison, but Leburu questioned whether there was any guarantee that Seditseng would not abscond again, given that he had done so twice before.
An affidavit from Investigations officer (IO), Constable Kedibonye Botsalo, supports the view that Seditseng is not a suitable candidate for bail due to his tendency to abscond when granted bail. The affidavit explains that Seditseng was initially denied bail by the magistrate court due to ongoing investigations and the possibility of tampering with evidence. However, a concession was later made by the prosecution, and Seditseng was granted conditional bail by the lower court.
The court documents reveal that Seditseng failed to appear before court on March 7th, 2016, without providing any explanation. As a result, a warrant for his arrest was issued. The case proceeded without him on several occasions until he finally appeared before court on July 13th, 2017. On that day, Seditseng’s bail was revoked due to his inability to provide valid reasons for his absences.
On October 4th, 2017, Seditseng was granted bail for the second time. However, he was once again absent from court on October 31st, 2017, without providing any reasons. He continued to be absent from court on five subsequent occasions until his arrest and appearance before court on August 30th, 2018.
During a period of nine months, Seditseng absconded from court without providing any reasons for his actions. This repeated pattern of absconding demonstrates a clear disregard for the bail conditions and raises concerns about his willingness to appear for trial.
Given Seditseng’s history of absconding and the potential risk of him doing so again, Judge Leburu’s decision to deny him bail is justified. The purpose of bail is to ensure the accused’s presence at trial, and Seditseng has repeatedly shown a lack of commitment to fulfilling this obligation. It is crucial to prioritize the safety of the community and the integrity of the justice system by keeping flight-risk suspects like Seditseng in custody until their trial is concluded.
In conclusion, the denial of bail to repeat flight-risk suspect Robert Seditseng is a necessary measure to ensure his appearance at trial. His history of absconding from court and failure to provide valid reasons for his actions demonstrate a disregard for the bail conditions and raise concerns about his willingness to face justice. By denying him bail, the court is prioritizing the safety of the community and upholding the integrity of the justice system.