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Boom, Kgafela lets the cat out of the bag

Bakgatla Ba Kgafela (BBK) Paramount Chief, Kgafela Kgafela II has revealed that his relations with the government of Botswana have almost normalised. The controversial Bakgatla Ba Kgafela kgosi on Tuesday professed that differences between him and Government have been settled.

Kgafela was responding to his royal uncle, Kgosi Nyalala John Pilane’s submissions during the ongoing Commission of Inquiry into Bakgatla dealings in Rustenburg on Tuesday. Kgafela had to let the cat out of the bag after Pilane scoffed at him demanding that he (Kgafela) return to Botswana and leave them alone in South Africa. He had challenged Kgafela to come back to Botswana and face his problems with the government of Botswana.

During his evidence in chief on Tuesday, Kgosi Kgafela rebuffed Kgosi Nyalala’s sentiments concerning Botswana before a three panel of Commissioners being Chairperson, Advocate Sesi Baloyi; and members, Advocate Mahumani and Professor Moleleki. Kgafela told the commission that, “Concerning Botswana issues, the trouble that I had in Botswana, of which I have told you that I had problems in Botswana.  I had serious mathata there.  It was my problem as a leader.  It comes with the seat,” he said.

He went on to state that his great grandfather, Molefe had his problems and was banished and that his father also had his own problems. “I had my own problems with the Botswana government.  It is between me and the Botswana government.  It is not relevant to this commission. My problems with the Botswana government, have been solved.  They are almost solved, all of them.  You see, it is because it is Botswana issues.  It is asked in Botswana, you must leave Botswana to Botswana, South Africa to South Africa.  Otherwise we mix things and then we get derailed,” cautioned Kgosi Kgafela.

Kgosi Kgolo further argued before the commission that his uncle was demanding from him documents from Home Affairs concerning his citizenship. “And even then, I have said that issue of Kgosi Kgafela’s citizenship is not relevant to this commission, but in any event, it is a matter between me and Home Affairs.  My citizenship issue is between me and Home Affairs.  And I am a South African by birth,” he averred, adding that it is a birth right which no one can take  away from him. “That is just how it stands.  I have got my South African birth certificate.  I am a citizen and this issue is not relevant.”

Kgosi Kgolo urged the commission to press his uncle to furnish him with the documents he is supposed to give him. The documents he said include among others, bank statements to see how billions of Rands were distributed. It was further Kgafela’s evidence that while he was in Botswana his uncle and his associates were using his name improperly to obtain money from a state owned entity.

He stressed that he as such has a personal interest to see how his name was used to whatever ends.  He also said it was unfortunate that his uncle was asking him to produce bank statement regarding some monies he claims to have been sending to him while he was still in Botswana. He said, his uncle as the depositor of the money as he claims, should be in a position to produce that kind of evidence. “But he is not willing to comply despite the fact that he has long been asked to avail such kind of information and a lot more. He is in contempt. He doesn’t respect anyone. He doesn’t respect the law, including you Commissioners. And I have given up on that aspect.”

Kgosi Kgolo’s sentiments concerning his uncle’s attitude towards the law was shared by one of the Evidence Team Leader, Benny Makola. “The consequences of failure on the part of Kgosi Pilane to produce documents, in fact has resulted in this Commission not being able to conclude at least one critical element which in our respectful submission can be separated from the other terms of reference. There has been a lapse of seven months. We have not been able to do any work and I regret just like Kgosi Kgafela I have also given up on how to receive those documents.”

On his part, Kgosi Pilane who was represented by Moshanti Makgale of Setshedi Makgale & Matlapeng Attorneys told the Commissioners that he has received instructions that Kgosi Kgolo is not a South African citizen by birth and that he is born in the USA. “Kgosi Kgolo came to South Africa and he does not have any identity document that identifies him as a South African.

On that account Commissioner we submit to an extent that there is this order that is standing, he cannot appear before you.” He further said they have brought the documents they had in their possession and that whatever information they haven’t produced was because they could not trace them despite diligent search, it save for the minutes of the meetings that were held in camera. “Some meetings were held in camera, so we cannot avail such information.”

KGAFELA’S TROUBLES WITH THE LAW

Kgafela and 35 other tribes’ men were facing 17 charges of floggings in 2010. Kgafela then fled to RSA in May 2012 leaving his then co-accused to dance to the music alone. He failed to show up at court appearances whereupon the application for the warrant was made by the police. The warrant was handling some of his criminal charges, among them escape from lawful custody and unlawful floggings of members of the public in Kgatleng, which were carried out by his regiments, acting on his instructions.

It was this relocation to RSA that caused a fallout between Kgafela and his uncle, Nyalala Pilane. It is reported that Kgafela had unearthed issues of maladministration and misuse of funds after which he demanded an audit of the morafe books of accounts from Nyalala. To further infuriate Nyalala, Kgafela asked him to step down and vacate the Bogosi in Moruleng to him (Kgafela). At this point Kgafela had decided to stay in South Africa permanently.  The move led to a sequence of disputes which developed to a chain of court cases before the South African courts and also the formation of the current commission termed ‘Commission of inquiry BBK’.

MINISTER TSOGWANE CONFIRMS

In an interview, the Minister for Local Government Slumber Tsogwane on Wednesday confirmed that it was true that Bakgatla Ba Kgafela chieftainship issue has been resolved. He was asked to comment on Kgosikgolo Kgafela’s point that his issues with Botswana government have been solved, and the minister’s immediate response was that, “yeah, he is right.”

But when asked if he meant that Kgafela could now come to Botswana freely, he said, “I don’t know about his issues with other ministries. Akere he had other issues with Kgathi’s ministry, which is Defence. They should speak for themselves. I am only referring to the issue of chieftainship as he had requested that we reinstate Bana Sekai as his representative here. And we did that recently because Sekai’s issues were also ironed out.”

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P230 million Phikwe revival project kicks off

19th October 2020
industrial hub

Marcian Concepts have been contracted by Selibe Phikwe Economic Unit (SPEDU) in a P230 million project to raise the town from its ghost status.  The project is in the design and building phase of building an industrial hub for Phikwe; putting together an infrastructure in Bolelanoto and Senwelo industrial sites.

This project comes as a life-raft for Selibe Phikwe, a town which was turned into a ghost town when the area’s economic mainstay, BCL mine, closed four years ago.  In that catastrophe, 5000 people lost their livelihoods as the town’s life sunk into a gloomy horizon. Businesses were closed and some migrated to better places as industrial places and malls became almost empty.

However, SPEDU has now started plans to breathe life into the town. Information reaching this publication is that Marcian Concepts is now on the ground at Bolelanoto and Senwelo and works have commenced.  Marcian as a contractor already promises to hire Phikwe locals only, even subcontract only companies from the area as a way to empower the place’s economy.

The procurement method for the tender is Open Domestic bidding which means Joint Ventures with foreign companies is not allowed. According to Marcian Concepts General Manager, Andre Strydom, in an interview with this publication, the project will come with 150 to 200 jobs. The project is expected to take 15 months at a tune of P230 531 402. 76. Marcian will put together construction of roadworks, storm-water drains, water reticulation, street lighting and telecommunication infrastructure. This tender was flouted last year August, but was awarded in June this year. This project is seen as the beginning of Phikwe’s revival and investors will be targeted to the area after the town has worn the ghost city status for almost half a decade.

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IMF projects deeper recession for 2020, slow recovery for 2021

19th October 2020

The International Monetary Fund (IMF) has slashed its outlook the world economy projecting a significantly deeper recession and slower recovery than it anticipated just two months ago.

On Wednesday when delivering its World Economic Outlook report titled “A long difficult Ascent” the Washington Based global lender said it now expects global gross domestic product to shrink 4.9% this year, more than the 3% predicted in April.  For 2021, IMF experts have projected growth of 5.4%, down from 5.8%. “We are projecting a somewhat less severe though still deep recession in 2020, relative to our June forecast,” said Gita Gopinath Economic Counsellor and Director of Research.

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Botswana partly closed economy a further blow of 4.2 fall in revenue

19th October 2020

The struggle of humanity is now how to dribble past the ‘Great Pandemic’ in order to salvage a lean economic score. Botswana is already working on dwindling fiscal accounts, budget deficit, threatened foreign reserves and the GDP data that is screaming recession.

Latest data by think tank and renowned rating agency, Moody’s Investor Service, is that Botswana’s fiscal status is on the red and it is mostly because of its mineral-dependency garment and tourism-related taxation. Botswana decided to close borders as one of the containment measures of Covid-19; trade and travellers have been locked out of the country. Moody’s also acknowledges that closing borders by countries like Botswana results in the collapse of tourism which will also indirectly weigh on revenue through lower import duties, VAT receipts and other taxes.

Latest economic data shows that Gross Domestic Product (GDP) for the second quarter of 2020 with a decrease of 27 percent. One of the factors that led to contraction of the local economy is the suspension of air travel occasioned by COVID-19 containment measures impacted on the number of tourists entering through the country’s borders and hence affecting the output of the hotels and restaurants industry. This will also be weighed down by, according to Moody’s, emerging markets which will see government losing average revenue worth 2.1 percentage points (pps) of GDP in 2020, exceeding the 1.0 pps loss in advanced economies (AEs).

“Fiscal revenue in emerging markets is particularly vulnerable to this current crisis because of concentrated revenue structures and less sophisticated tax administrations than those in AEs. Oil exporters will see the largest falls but revenue volatility is a common feature of their credit profiles historically,” says Moody’s. The domino effects of containment measures could be seen cracking all sectors of the local economy as taxes from outside were locked out by the closure of borders hence dwindling tax revenue.

Moody’s has placed Botswana among oil importers, small, tourism-reliant economies which will see the largest fall in revenue. Botswana is in the top 10 of that pecking order where Moody’s pointed out recently that other resource-rich countries like Botswana (A2 negative) will also face a large drop in fiscal revenue.

This situation of countries’ revenue on the red is going to stay stubborn for a long run. Moody’s predicts that the spending pressures faced by governments across the globe are unlikely to ease in the short term, particularly because this crisis has emphasized the social role governments perform in areas like healthcare and labour markets.

For countries like Botswana, these spending pressures are generally exacerbated by a range of other factors like a higher interest burden, infrastructure deficiencies, weaker broader public sector, higher subsidies, lower incomes and more precarious employment. As a result, most of the burden for any fiscal consolidation is likely to fall on the revenue side, says Moody’s.

Moody’s then moves to the revenue spin of taxation. The rating agency looked at the likelihood and probability of sovereigns to raise up revenue by increasing tax to offset what was lost in mineral revenue and tourism-related tax revenue. Moody’s said the capacity to raise tax revenue distinguishes governments from other debt issuers.  “In theory, governments can change a given tax system as they wish, subject to the relevant legislative process and within the constraints of international law. In practice, however, there are material constraints,” says Moody’s.

‘‘The coronavirus crisis will lead to long-lasting revenue losses for emerging market sovereigns because their ability to implement and enforce effective revenue-raising measures in response will be an important credit driver over the next few years because of their sizeable spending pressures and the subdued recovery in the global economy we expect next year.’’

According to Moody’s, together with a rise in stimulus and healthcare spending related to the crisis, the think tank expects this drop in revenue will trigger a sizeable fiscal deterioration across emerging market sovereigns. Most countries, including Botswana, are under pressure of widening their tax bases, Moody’s says that this will be challenging. “Even if governments reversed or do not extend tax-easing measures implemented in 2020 to support the economy through the coronavirus shock, which would be politically challenging, this would only provide a modest boost to revenue, especially as these measures were relatively modest in most emerging markets,” says Moody’s.

Botswana has been seen internationally as a ‘tax ease’ country and its taxes are seen as lower when compared to its regional counterparts. This country’s name has also been mentioned in various international investigative journalism tax evasion reports. In recent years there was a division of opinions over whether this country can stretch its tax base. But like other sovereigns who have tried but struggled to increase or even maintain their tax intake before the crisis, Botswana will face additional challenges, according to Moody’s.

“Additional measures to reduce tax evasion and cutting tax expenditure should support the recovery in government revenue, albeit from low levels,” advised Moody’s. Botswana’s tax revenue to the percentage of the GDP was 27 percent in 2008, dropped to 23 percent in 2010 to 23 percent before rising to 27 percent again in 2012. In years 2013 and 2014 the percentage went to 25 percent before it took a slip to decline in respective years of 2015 up to now where it is at 19.8 percent.

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