A meeting of some Ministers of Southern Africa Development Cooperation (SADC) member states who were in dire straits this week in Gaborone failed to draw a concrete explanation and resolution for Zimbabwe political crisis.
Zimbabwe military men at the behest of the country defence force commander General Constantine Chiwenga has put Commander in Chief and President Robert Mugabe under house arrest in lieu to sweet talk him to step down. So far the generals have seized control of state media, airport and state house among others while calling for calm in the country emphasizing that there is “no coup” but “house arrest of the president”.
It is still unclear whether a compromise between the duos will see the light of the day but should it go pear-shaped there will be dire implications for Zimbabwe and her future. If stay put Mugabe may charge the army high command for treason with a minimum sentence of 20 years behind the bars or if the military coup d’état becomes triumphant finding a replacement for Mugabe will be an arduous task as the party factional wars are at their time peak.
In the presumed coup d’état, the army men are seen to be serving the interest of the recently fired Vice President Emmerson Mnangagwa whom they are strong indications that they want him to fill the shoes of the 93 year old Zimbabwean liberator turned autocrat – as a president. They say first lady Grace Mugabe is the root of all evils in ZANU PF particularly her recently repeated pronouncements and endevour to want to succeed her husband thereby with high risk of leading into a first political dynasty since the liberation of the country from the Boers in 1980.
Fear is also in the air that if the coup is successful; the Military coups may also take the order of the day in upcoming years as they would be aware of the leverage they possess in relation to their political top politburo (president). In light of the telling situation in the country (Zimbabwe), a meeting was called on Thursday by the SADC Organ Troika Council but Ministers present could ‘not bite more than they can chew’ instead recommending the complex political matter to an urgent Heads of State extra ordinary summit.
The said Ministerial meeting was consisting mostly ministers responsible for External Affairs in SADC Troika member states in the mold of its Chairperson who is also South Africa (SA) Minister of International Relations and Cooperation Maite Nkoana-Mashabane, Minister of Foreign Affairs in Zambia Harry Kalaba, Angola Minister of Defence Salviano De Jesus Sequeira (also chair of organ) and Tanzanian High Commissioner Sylvester Ambokile.
The meeting delegation could not even make a pronouncement following inquiries from journalists on whether they see the current development in the country as a military coup or not and to also make a position on which direction they want Zimbabwe to take from the current hullabaloo. The meeting could only resolve that “having considered the unfolding situation in the Republic of Zimbabwe, the Organ Troika recommended the convening of an urgent Extra Ordinary SADC Summit and committee to remain seized with the situation in the Republic of Zimbabwe.”
According to SADC Troika Chairperson Nkoane-Mashabane, this is cognizant that the organ has really “noted” with “great concern” the unfolding situation at Zimbabwe. She said the meeting re-affirmed the SADC’s commitment to African Union (AU) constitutive Act and the SADC’s democratic principles, as they relate to the unconstitutional removal of democratically elected governments.
The SA minister of International Relations and Cooperation also stressed that the meeting also “reaffirmed the need for SADC member states to remain guided by their constitutions” and “called upon all stakeholders in Zimbabwe to settle the political challenges through peaceful means.” The meeting which was seen as unfruitful to the core some say it almost turned into a gathering of friends and counterparts enjoying biscuits and tea and, chatting about Zimbabwe while not necessarily coming up with tangible results that may change Zimbabwe crisis for good.
On the same token, SADC has also been seen as swiftly and trying hard to meddle in Zimbabwean affairs while they neglected the country when they were needed most in 2008 during the massive bloodshed of ordinary citizen and suspected rigging of elections by pro-Mugabe ZANU PF operatives masquerading as public servants of the Zimbabwean Independent Electoral Commission.
“Leave Zimbabwe to Zimbabweans to solve their problems, and there should be no interference by SADC,” an independent Zimbabwean MP Themba Mliswa who was present at the press conference in Gaborone told the press. The objective of the meeting as was called by incumbent SADC Chair who doubles as President of South Africa Jacob Zuma was to “consider the unfolding situation in the Republic of Zimbabwe.”
SADC is an organization of 16 member states established in 1980. The mission of SADC is to promote sustainable and equitable economic growth and socio-economic development through efficient, productive systems, deeper cooperation and integration, good governance and durable peace and security; so that the region emerges as a competitive and effective player in international relations and the world economy.
“How Mugabe cornered the Generals”
Meanwhile, according to a revered journalist at Southern News, Njabulo Ncube, Mugabe cornered the generals who were playing in his hands of steel. “Mugabe asked the generals on why they were saying he should step down and they cited the purges. It is said, since there was no coup, he also asked them to bring the country's constitution and they were cornered,” Ncube said.
He continued: “the Generals were then accused of meddling in party politics. Mugabe has power to fire, appoint and disappoint according to the country's Constitution. They were also asked on why and how they were choosing Emmerson Mnangagwa and not Joice Mujuru or Sydney Sekeramai. And he said if it were for the purges, then he would be ready to readmit Mujuru as she was first to be purged.”
In fact, the journalist said Mugabe accused them (army men) of being the ones causing instability. “According to him, it showed him that the military were running a faction. He told the SA envoys that the purges were only in the party not government. He said he was surprised that the army talked of instability yet no one had gone in the streets to protest the purges He then told them that if there were any other constitutional reasons they could cite, then he could step down,” he said.
Following the house arrest or the so called military coup d’état, Mugabe reappeared in public on Friday officiating at Open University Graduation in the outskirts of Harare. It is believed that ZANU-PF party is set to draft resolution to dismiss Mugabe this weekend before his impeachment motion next week.
Some vendors have been misled Vendors thrive on households goods and fresh produce
Despite the previous false allegations that the Tobacco Control Bill will lead to several 20 000 vendors across the country losing their jobs, several local vendors have expressed that they are ready for the bill and because vendors sell mostly household goods
“This is something that we openly accept and receive as street vendors, the problem is some of our counterparts were misled and made to believe that we will not be allowed to sell cigarettes on our stalls.
Some of us got to understand that the bill states that we have to be licensed to sell cigarettes, we are not supposed to sell them to children under the age of 18 years of age and eliminating the selling of single sticks. We understand that this agenda is meant to develop a healthy nation but not take us down,” said Mbimbi Tau a vendor who operates from Mogoditshane.
The Tobacco Control Bill has been passed in several countries and street vendors are operating properly without any challenges faced. Tau further mentioned that there is no way that the Tobacco Control Bill will affect their business operations, all they have to do as vendors are to get the required documentation and do what the bill requires.
Another vendor Busani Selalame who operates from Gaborone Bonnington North was not shy to express his support towards the Tobacco Control Bill, “the problem is that some people within our sector have been misled and now they think that the bill is meant to take our operations down and completely stop selling cigarettes.
I support the fact that we are not supposed to sell cigarettes to children who are under the age of 18 years of age this has always been wrong, as parents we should be cautious of such and ensure that our children are disassociated with cigarettes,” said Selalame.
The Tobacco Control Bill prohibits advertising, promotion and sponsorship by the tobacco industry to prevent messages, cues, and other inducements to begin using tobacco, especially among the youth, to reassure users to continue their use, or that otherwise undermine quitting.
Renowned economist Bakang Ntshingane is of the view that since vendors sell household goods and fresh produce they are likely to keep on making profits despite what the Tobacco Control Bill comes with. He further stated that the Tobacco Control Bill will not be of harm on the local economy since the country does not manufacture or produce any tobacco related products.
BancABC Botswana, the BSE-listed bank today announced its half year results for the six months ended 30 June 2021, against a subdued economic backdrop, exacerbated by the COVID-19 pandemic and related lockdowns.
BancABC has remained resilient in the current operating environment as business activity increased in the first half of 2021, with Real GDP up by 0.7% in the first quarter compared to a contraction of 4.6% in the previous quarter. Commenting on the results, Managing Director Kgotso Bannalotlhe said, “Currently, economic activity is relatively stable.
While COVID-19 placed significant pressure on the economy and our overall business, BancABC Botswana has shown remarkable resilience amid a tough operating environment. While the bank operates in an environment that is seeing a rise in COVID-19 infections, it is encouraging that the business has maintained a healthy capital adequacy ratio as well as being successful in improving total expenses with focus on cost containment across the board.”
The retail segment saw an increase in customer deposits this year, signalling an improvement from the previous period and strengthening the current funding mix. This segment has built great momentum and continues to advance its digital strategy, through various products such as the mobile banking app, SARUMoney, as well as enhanced product offerings such as the introduction of fash cash. The Bank has invested in its digital capabilities to ensure a seamless and hassle-free banking experience for all its customers.
The commercial segment was successful in reducing the cost of funding. In addition, Treasury and Global Markets performed well, doubling from the previous comparative period. The current year performance across the bank’s different segments is testament to the bank’s strong income lines, aiding the Bank’s resilience during this time.
“The Bank experienced slow loan book growth due to a constrained economic environment, however, we remain optimistic that as the economy recovers, credit appetite amongst the Bank’s customer-base will increase. In addition, we reported good non-interest revenue, driven by increased trading income on the back of improved margins and volumes. Our outlook remains positive as we expect momentum across the different segments to improve over time,” said Ratang Icho-Molebatsi, BancABC Botswana Finance Director.
In April 2021, BancABC Botswana’s ultimate holding company, Atlas Mara Limited, as well as ABC Holdings Limited and Access Bank Plc announced an agreement to a proposed acquisition of 78.15% of BancABC Botswana. The transaction presented an opportunity for BancABC Botswana’s strong retail banking operation to merge with Access Bank’s wholesale banking capabilities, augmenting itself as one of Africa’s leading banks.
“The transaction provides significant scope for revenue diversification and growth in the corporate and SME banking segment. Increased access to trade finance, treasury, international payments and loans through the wider distribution network offered by Access Bank’s presence in the key trade corridors that connect Africa to the rest of the world, presents solid opportunities for BancABC Botswana”, commented Icho-Molebatsi “With the transaction, BancABC Botswana’s customers stand to benefit from best-in-class digital platforms and product suites, leveraging Access Bank’s group IT infrastructure as well as other fintech solutions”, said Bannalotlhe.
Further, with Access Bank expanding its footprint into Botswana, it will position the Bank to deliver a more complete set of banking solutions to Batswana across the country”, concluded Bannalothle.
Last Friday, the board of Directors of the African Development Bank Group authorised a $137 million (P1.5 billion) loan to support Botswana’s Post COVID-19 pandemic economic recovery.
The funds, extended under the Bank Group’s Botswana Economic Recovery Support Program, will be used to enact multi-sector reforms that will increase spending efficiency, create jobs and drive inclusive growth.
The project has three components: enhancing domestic resource mobilisation and mitigating fiscal risks to enhance macroeconomic performance and create fiscal space for spending on social safety nets; supporting private sector-led agriculture and industry to bolster productivity and value addition and increase job opportunities, and offering business development services to micro and small enterprises to advance social protection and gender equity. The three components are expected to reinforce one another.
“The African Development Bank is providing support for reforms to enhance private sector-led agriculture and transformation of the industrial sector,” said Leila Mokadem, Director General of the Southern Africa Regional Development and Business Delivery Office. “Agriculture value addition can serve as a springboard for industrialisation and job creation,” she added.
The project aligns with the Bank Group’s Ten-Year Strategy (2013-2022) and its High Five strategic priorities, particularly Industrialise Africa and Improve the quality of life of the people of Africa. The African Development Bank observed that Botswana has a very low risk of debt distress and a positive medium-term growth outlook. However, a lack of economic diversification exposes the country to significant vulnerabilities.
The Bank Group’s active portfolio in Botswana amounts to UA 57.7 million ($81.9 million) and comprises four projects. The financial sector accounts for the largest share of the portfolio by industry (97.1%), followed by agriculture (1.7%) and industry (1.2%). In the past, the African Development Bank partnered with various Botswana government agencies to accelerate economic growth.
On the 21st of February 2020, the bank signed a thematic Line of Credit (LoC) of P900 Million for a 10-year tenor with Botswana Development Corporation (BDC), a wholly state-owned investment agency. This was during that time, the single largest transaction of its nature to ever take place in Botswana.
The LoC was penned to support the BDC’s long-term strategy to scale up its investments in critical sectors, including manufacturing, transport and service sectors, with the overall objective of supporting the transformation and industrialisation of the Botswana economy. BDC eyed a more comprehensive socio-economic benefit with this partnership, including attracting investments into the economy and employment creation.
The African Development Bank is a multilateral development finance institution. It has an overarching objective to spur sustainable economic development and social progress in its regional member countries (RMCs) through mobilising and allocating resources for investment and providing policy advice and technical assistance to support development efforts.
This transaction was poised to support further BDC’s focus on safeguarding its balance sheet to ensure financial sustainability whilst fulfilling its mandate as the Botswana Government’s principal investment arm.
The COVID-19 pandemic has landed massive blows on Botswana; apart from claiming more than 2300 lives thus far, the contagious plague has exacerbated existing growth challenges. The effects of the pandemic have led to an estimated real gross domestic product (GDP) contraction of 7.9% in 2020, according to the World Bank, worse than that of the 2009 global financial crisis.
The contraction reflects the impact that reduced global demand, travel restrictions and social distancing measures have had on output in crucial production and export sectors, including the diamond industry and tourism.
Botswana’s fiscal deficit is set to widen to 11.3% of GDP in FY2020/21, from 5.6% in FY2019/20, reflecting a sharp decline in mineral revenues, a sticky public sector wage bill, and the impact of the COVID-19 spending. Similarly, the current account deficit is estimated to have widened to 8 percent of GDP in 2020 following the sharp decline in diamond exports.
Developments in the global diamond industry will significantly impact the short-term recovery, given Botswana’s dependence on the commodity. While recovery is expected in 2021 due to a favourable outlook for the diamond industry, the economic impact of COVID-19 is likely to be deep and long-lasting. The P1.5 billion African Development Bank loan comes after the World Bank approved a P2.5 billion boost for Botswana early this year.
The Programmatic Economic Resilience and Green Recovery Development Policy Loan (DPL) will support the implementation of Botswana’s Economic Recovery and Transformation Plan and is designed to strengthen COVID-19 pandemic relief while bolstering resilience to future shocks.
In August, Botswana received the International Monetary Fund (IMF) 189 Special Drawing Rights allocation worth P3 billion. The IMF SDR is a non-currency asset that Botswana can convert into hard currency by trading it with other IMF member countries.