Botswana‘s efforts to produce enough food for itself has been noted as bearing fruits, this emerged recently at a number of agricultural gatherings nationwide.
A week ago in Mosisedi Farmers Harvest day, Vice President Mokgweetsi Masisi observed that Botswana was capable of being food sufficient and even exporting agricultural food produce to foreign markets. The VP however remarked that such dream will not be realized over night. Currently, Botswana imports cumulatively across all food commodities well over 50 % of its food consumed daily. Notably a lot more under the fruits fresh produce and diary, milk products with only 6 % of milk consumed locally being produced in Botswana.
The country’s biggest supplier of agricultural produce is South Africa. Apart from government policies which include agriculture tailored funding frameworks; incentives and land allocations, farmers’ commitment is viewed as major ingredient to realization of Botswana’s dream of being food secure.
Cluster farming, which is a cooperative-like large scale professional farming set-up is one of the strategic models echoed many times as a highly productive undertaking. Mosisedi farms and Pandamatenga farmers are notably some commercial farming setups that are believed to be true success stories of cluster farming.
Government investment arm Citizen Entrepreneurial Development Agency (CEDA) Chief Executive Thabo Thamane urged other farmers from other locations around Botswana to come to the party by learning from Mosisedi farmers and other successful cluster agricultural producers.
“We as CEDA spent over 50 million in Mosisedi farmers alone, and we continue doing more for these serious farmers ranging from organized training, skills exchange and capacity building, but my worry and concern is that other farmers around the country are just spectators in this endeavour of commercializing agriculture, we have long asked them to formulate very formidable clusters with feasible ideas well put in paper so that we can assist them financially but they are not showing any seriousness,” he said. Mosisedi Farmers Association comprises of twenty-five dedicated farmers, who collectively till over 10,000 hectares of land, with the common objective of ensuring food security for the country producing field crops.
CHALLENGES FACING AGRICULTURE IN BOTSWANA
Just like any other economic sector, Agriculture is faced with its own unique challenges that are mainly environmental because of the nature of the sector itself. Most farmers being small scale and non commercial depend on rain for ploughing and also use outdated methods of farming.
For Animal Husbandry Botswana as a semi desert vegetated country is vulnerable to animal diseases with a common one being Foot and Mouth Disease which has proven expensive to deal with in the past. As for crop produce, slow adoption of Batswana farmers to modernized techno-based models and methods of farming due to lack of knowledge and agricultural education hinders efforts of a commercial farming Botswana. Botswana‘s climate conditions also contributes negatively to farmers’ produce.
Vice President Masisi noted that issues of poor climate conditions needed to be outsmarted by introduction of new technologies and modernized practices of farming. “Considering the scarcity of higher yielding agricultural land, I urge all farmers to embrace Climate Smart Agriculture as it promotes sustainable intensification of agricultural inputs, which increases output per area, without necessarily increasing the area under production. Furthermore, I encourage farmers to continue soil testing and using the right agro-chemicals for their crops,” he emphasized.
Poor infrastructure is also noted as a contribution to slow improvement of the agricultural sector locally. Still at the Mosisedi Harvest Day Bangwaketse Paramount Chief Kgosi Malopi told gatherers that poor roads was a huge challenge during the times of harvest. He said that farmers needed roads in good conditions to move large tonnes of harvest to reach their market after ploughing seasons. He however commended government efforts where electricity reached most farmers and this helps them cut costs of operations and improved on efficiency.
Mosisedi farms also recently joined the Motloutse farms in SPEDU region to enjoy subsidized connection of electricity in their farms. “Mosisedi Farmers’ Association is amongst those who have already benefited from ESP, with 18 farms now connected to electricity. I am further informed that the Association is planning to do irrigated arable production in response to climate change and the electricity will facilitate installation of irrigation equipment,” observed Masisi.â€¨
Botswana Government efforts to unleash potential in the Agricultural Sector precisely commercial farming are commendable. The establishment of National Development Bank, though it hasn’t been as much as successful as anticipated has assisted in setting up of some of Botswana’s largest commercial farms especially in the livestock segment.
CEDA also a government arm funds viable agricultural projects to tunes of millions and government has already spent billions of pula investing in Agriculture through CEDA. For environmental challenges Government with additional technical support from regional and global partners has introduced the Climate Smart Agriculture (CSA) programme. This is a long-term initiative that commenced in 2015 and is expected to continue until 2030. Masisi echoed that the primary aim of the CSA programme is to improve agricultural productivity, while reducing farmers’ vulnerability to climate change.
“CSA will boost investment in agricultural research and innovation in order to achieve high levels of sustained productivity. Vision 2036 aspirations speak to a sustainable agricultural sector that optimizes agricultural returns through the adoption of modern applicable farming technology. It is, therefore, pleasing to note that the CSA programme has already encompassed the use of technology as a driver for attaining high output in the agricultural sector,” he said.
Government last year September rearranged ministries and aligned departments to keep to times with evolving economic challenges, administration and governance shortcomings. The Ministry of Agriculture as realigned to add the segment of Food Security with an aim of fast tracking Botswana‘s quest for food sufficiency.
Former President of Botswana Sir Ketumile QJ Masire was quoted recently applauding the efforts of Botswana in improving the agricultural sector saying they are beginning to bear fruits. Masire, a farmer himself observed that youth participation in agricultural businesses presented hope that in decades to come agriculture will create jobs and deliver a much needed diversified economy.
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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”