Economic data released in the first quarter of 2017, much of which relates to the final quarter of 2016, presents a mixed picture of the economy and no clear direction. On the economic growth front, preliminary GDP data for 2016 show real growth of 4.3% for the year as a whole, well ahead of most estimates (including ours).
This mostly reflects the impact of improved trading conditions in the diamond sector. With production relatively stable through 2016, the impact of the previous year’s reduction in diamond output has fallen away from the GDP calculation, hence, growth of diamond output moved out of negative territory. However, lower production of copper-nickel, due to poor market conditions and mine closures, led to negative growth in the mining sector as a whole in 2016.
Notwithstanding the absence of growth in diamond production, diamond sales (mostly exports) were significantly higher, reflecting sales from stockpiles accumulated earlier, and an increase in diamond re-exports through De Beers Global Sightholder Sales (DBGSS). This in turn affects other sectors of the economy, with diamond sorting and valuing included as part of the Finance and Business Services sector, and diamond trading included under the Trade sector.
Growth in the latter rose to 13.5% in 2016, including a massive 75% real growth in the wholesale sub-sector, following increased diamond throughput and a revision of historical data. Overall, this caused the non-mining private sector to grow by a huge 7.2% in 2016, compared to only 1.4% in 2015.
However, the usefulness of this measure (non-mining private sector growth) as an indicator of what is happening in the economy outside of mining is gradually declining. Three of the non-mining economic sectors – Manufacturing, Trade and Finance & Business services – all now include activities related to the diamond industry – respectively, diamond cutting and polishing, diamond trading, and diamond sorting and valuing. Increasingly, changes in the output of these sectors are driven by swings in the global diamond industry.
In a way this is positive – it reflects the success of a policy drive to move the diamond industry downstream from mining into other value-added activities. But it does mean that there is no easy way to ascertain output trends in the economy outside of diamond-related activity. It would be relatively straightforward for Statistics Botswana to carve out diamond-related sub-sectors from the Manufacturing, Trade and Finance & Business sectors (in the same way that diamond mining is separated from other mining activities), and we hope that this will be done soon in order to allow the calculation of output and growth trends in the non-diamond segment of the economy.
In the meantime, the picture is mixed across the various sectors of the economy, with close to zero growth in agriculture and manufacturing, but healthier growth (over 4%) in construction, retail trade, hotels & restaurants, transport & communications, and banking. The upturn in the global diamond market has helped to turn around the country’s foreign trade position, with a large increase in total exports and a move from balance of trade deficit in 2015 to a substantial surplus in 2016.
It seems likely that the current account surplus was largely offset by capital outflows, however, as official foreign exchange reserves declined during 2016, although the complete picture will not become clear until full balance of payments data for the year are released. Capital outflows most likely reflect the relatively low interest rates in Botswana as compared to South Africa, as well better investment opportunities for the private sector outside of Botswana.
The financial sector also presents a mixed picture. Credit growth has slowed substantially, to the lowest annual rate in nearly 20 years, and arrears on lending have risen through 2016. Although the level of arrears on bank lending has doubled over the past four years, the rate remains relatively low (6.6% of loans in arrears of 30 days or more, and 4.2% over 90 days). Banks seem to be dealing with the problem, however, through risk management, cost control and by being cautious with new lending.
As a result, return on equity after tax for the banking sector increased from 12.6% in 2015 to 15.3% in 2016, although even this higher figure is still low by historical standards for Botswana’s banks. There are also some signs of liquidity tightening in the financial sector, with rising interest rates on BoBCs, reflecting very slow growth in the deposit base of the banking system.
Inflation is also edging up, and at 3.5% in March is at the highest rate for over two years. Although likely to increase further it should stay below the 4.5% mid-point of the BoB’s inflation objective range for the foreseeable future. Nevertheless, these developments all suggest that we may have reached the low point of the interest rate cycle, with the next move more likely to be upwards than downwards.
One of the major events of the first quarter, as always, was the presentation of the Budget in early February. Much of the content had already been flagged, in the Budget Strategy Paper and in National Development Plan 11, approved by Parliament in December 2016. Nevertheless, the projected fiscal position for 2017/18 is now more favourable than had been indicated earlier, with a large increase in expected receipts from the Southern African Customs Union (SACU). Hence, the projected budget deficit for 2017/18 is now P2.4 billion (1.4% of GDP), compared to the earlier estimate of P6.8 billion (4.1% of GDP).
The budget also projects a modest 4.4% increase in overall spending. The additional spending is concentrated on recurrent spending (up 8.6%), notably wages and salaries (up 18.5%) and grants and subventions (up 12.6%). Across sectors, the main beneficiaries are spending on health, urban and regional infrastructure and roads, as well as general public administration and transfers to local authorities. As in the past, education receives the largest share of spending, followed by general public services.
Parliament was this week once again seized with matters that concern them and borders on conflict of interest and abuse of privilege.
The two matters are; review of MPs benefits as well as President Mokgweetsi Masisi’s participation in the bidding for Banyana Farms. For the latter, it should not come as a surprise that President Masisi succeeded in bid.
The President’s business interests have also been in the forefront. While President Masisi is entitled as a citizen to participate in a various businesses in the country or abroad, it is morally deficient for him to participate in a bidding process that is handled by the government he leads. By the virtue of his presidency, Masisi is the head of government and head of State.
Not long ago, former President Festus Mogae suggested that elected officials should consider using blind trust to manage their business interests once they are elected to public office. Though blind trusts are expensive, they are the best way of ensuring confidence in those that serve in public office.
A blind trust is a trust established by the owner (or trustor) giving another party (the trustee) full control of the trust. Blind trusts are often established in situations where individuals want to avoid conflicts of interest between their employment and investments.
The trustee has full discretion over the assets and investments while being charged with managing the assets and any income generated in the trust.
The trustor can terminate the trust, but otherwise exercises no control over the actions taken within the trust and receives no reports from the trustees while the blind trust is in force.
Botswana Democratic Party (BDP) Secretary General, Mpho Balopi, has defended President Masisi’s participation in business and in the Banyana Farms bidding. His contention is that, the practise even obtained during the administration of previous presidents.
The President is the most influential figure in the country. His role is representative and he enjoys a plethora of privileges. He is not an ordinary citizen. The President should therefore be mindful of this fact.
We should as a nation continue to thrive for improvement of our laws with the viewing of enhancing good governance. We should accept perpetuation of certain practices on the bases that they are a norm. MPs are custodians of good governance and they should measure up to the demands of their responsibility.
Parliament should not be spared for its role in countenancing these developments. Parliament is charged with the mandate of making laws and providing oversight, but for them to make laws that are meant solely for their benefits as MPs is unethical and from a governance point of view, wrong.
There have been debates in parliament, some dating from past years, about the benefits of MPs including pension benefits. It is of course self-serving for MPs to be deliberating on their compensation and other benefits.
In the past, we have also contended that MPs are not the right people to discuss their own compensation and there has to be Special Committee set for the purpose. This is a practice in advanced democracies.
By suggesting this, we are not suggesting that MP benefits are in anyway lucrative, but we are saying, an independent body may figure out the best way of handling such issues, and even offer MPs better benefits.
In the United Kingdom for example; since 2009 following a scandal relating to abuse of office, set-up Independent Parliamentary Standards Authority (IPSA)
IPSA is responsible for: setting the level of and paying MPs’ annual salaries; paying the salaries of MPs’ staff; drawing up, reviewing, and administering an MP’s allowance scheme; providing MPs with publicly available and information relating to taxation issues; and determining the procedures for investigations and complaints relating to MPs.
Owing to what has happened in the Parliament of Botswana recently, we now need to have a way of limiting what MPs can do especially when it comes to laws that concern them. We cannot be too trusting as a nation.
MPs can abuse office for their own agendas. There is need to act swiftly to deal with the inherent conflict of interest that arise as a result of our legislative setup. A voice of reason should emerge from Parliament to address this unpleasant situation. This cannot be business as usual.
The 490-hectare campus researches the world’s deadliest pathogens, including Anthrax (in 1944, the Roosevelt administration ordered 1 million anthrax bombs from Fort Detrick), Ebola, smallpox, and … you guessed right: coronaviruses. The facility, which carries out paid research projects for government agencies (including the CIA), universities and drug companies most of whom owned by the highly sinister military-industrial complex, employs 900 people.
Between 1945 and 1969, the sprawling complex (which has since become the US’s ”bio-defence centre” to put it mildly) was the hub of the US biological weapons programme. It was at Fort Detrick that Project MK Ultra, a top-secret CIA quest to subject the human mind to routine robotic manipulation, a monstrosity the CIA openly owned up to in a congressional inquisition in 1975, was carried out. In the consequent experiments, the guinea pigs comprised not only of people of the forgotten corner of America – inmates, prostitutes and the homeless but also prisoners of war and even regular US servicemen.
These unwitting participants underwent up to a 20-year-long ordeal of barbarous experiments involving psychoactive drugs (such as LSD), forced electroshocks, physical and sexual abuses, as well as a myriad of other torments. The experiments not only violated international law, but also the CIA’s own charter which forbids domestic activities. Over 180 doctors and researchers took part in these horrendous experiments and this in a country which touts itself as the most civilised on the globe!
Was the coronavirus actually manufactured at Fort Detrick (like HIV as I shall demonstrate at the appropriate time) and simply tactfully patented to other equally cacodemonic places such as the Wuhan Institute of Virology in China?
THE FORT DETRICK SCIENTISTS’ PROPHECY WAS WELL-INFORMED
About two years before the term novel coronavirus became a familiar feature in day-to-day banter, two scientist cryptically served advance warning of its imminence. They were Allison Totura and Sina Bavari, both researchers at Fort Detrick.
The two scientists talked of “novel highly pathogenic coronaviruses that may emerge from animal reservoir hosts”, adding, “These coronaviruses may have the potential to cause devastating pandemics due to unique features in virus biology including rapid viral replication, broad host range, cross-species transmission, person-to-person transmission, and lack of herd immunity in human populations … Associated with novel respiratory syndromes, they move from person-to-person via close contact and can result in high morbidity and mortality caused by the progression to acute respiratory distress syndrome (ARDS).”
All the above constitute some of the documented attributes and characteristics of the virus presently on the loose – the propagator of Covid-19. A recent clinical review of Covid-19 in The Economist seemed to bear out this prognostication when it said, “It is ARDS that sees people rushed to intensive-care units and put on ventilators”. As if sounding forth a veritable prophecy, the two scientists besought governments to start working on counter-measures there and then that could be “effective against such a virus”.
Well, it was not by sheer happenstance that Tortura and Bavari turned out to have been so incredibly and ominously prescient. They had it on good authority, having witnessed at ringside what the virus was capable of in the context of their own laboratory. The gory scenario they painted for us came not from secondary sources but from the proverbial horse’s mouth folks.
CDC’S RECKLESS ADMISSION
In March this year, Robert Redfield, the US Director for the Centre for Disease Control and Prevention (CDC), told the House of Representatives’ Oversight Committee that it had transpired that some members of the American populace who were certified as having died of influenza turned out to have harboured the novel coronavirus per posthumous analysis of their tissue.
Redfield was not pressed to elaborate but the message was loud and clear – Covid-19 had been doing the rounds in the US much earlier than it was generally supposed and that the extent to which it was mistaken for flu was by far much more commonplace than was openly admitted. An outspoken Chinese diplomat, Zhao Lijian, seized on this rather casual revelation and insisted that the US disclose further information, exercise transparency on coronavirus cases and provide an explanation to the public.
But that was not all the beef Zhao had with the US. He further charged that the coronavirus was possibly transplanted to China by the US: whether inadvertently or by deliberate design he did not say. Zhao pointed to the Military World Games of October 2019, in which US army representatives took part, as the context in which the coronavirus irrupted into China. Did the allegation ring hollow or there was a ring of truth to it?
THE BENASSIE FACTOR
The Military World Games, an Olympic-style spectrum of competitive action, are held every four years. The 2019 episode took place in Wuhan, China. The 7th such, the games ran from October 18 to October 27. The US contingent comprised of 17 teams of over 280 athletes, plus an innumerable other staff members. Altogether, over 9000 athletes from 110 countries were on hand to showcase their athletic mettle in more than 27 sports. All NATO countries were present, with Africa on its part represented by 30 countries who included Botswana, Egypt, Kenya, Zambia, and Zimbabwe.
Besides the singular number of participants, the event notched up a whole array of firsts. One report spelt them out thus: “The first time the games were staged outside of military bases, the first time the games were all held in the same city, the first time an Athletes’ Village was constructed, the first time TV and VR systems were powered by 5G telecom technology, and the first use of all-round volunteer services for each delegation.”
Now, here is the clincher: the location of the guest house for the US team was located in the immediate neighbourhood of the Wuhan Seafood Market, the place the Chinese authorities to this day contend was the diffusion point of the coronavirus. But there is more: according to some reports, the person who allegedly but unwittingly transmitted the virus to the people milling about the market – Patient Zero of Covid-19 – was one Maatie Benassie.
Benassie, 52, is a security officer of Sergeant First Class rank at the Fort Belvoir military base in Virginia and took part in the 50-mile cycling road race in the same competitions. In the final lap, she was accidentally knocked down by a fellow contestant and sustained a fractured rib and a concussion though she soldiered on and completed the race with the agonising adversity. Inevitably, she saw a bit of time in a local health facility. According to information dug up by George Webb, an investigative journalist based in Washington DC, Benassie would later test positive for Covid-19 at the Fort Belvoir Community Hospital.
Incidentally, Benassie apparently passed on the virus to other US soldiers at the games, who were hospitalised right there in China before they were airlifted back to the US. The US government straightaway prohibited the publicising of details on the matter under the time-honoured excuse of “national security interests”, which raised eyebrows as a matter-of-course. As if that was not fishy enough, the US out of the blue tightened Chinese visas to the US at the conclusion of the games.
The rest, as they say, is history: two months later, Covid-19 had taken hold on China territory. “From that date onwards,” said one report, “one to five new cases were reported each day. By December 15, the total number of infections stood at 27 — the first double-digit daily rise was reported on December 17 — and by December 20, the total number of confirmed cases had reached 60.”
TWO CURIOUS RESEARCH HALTINGS
Is it a coincidence that all the US soldiers who fell ill at the Wuhan games did their preparatory training at the Fort Belvoir military base, only a 15-minutes’ drive from Fort Detrick?
That Fort Detrick is a plain-sight perpetrator of pathogenic evils is evidenced by a number of highly suspicious happenings concerning it. Remember the 2001 anthrax mailing attacks on government and media houses which killed five people right on US territory? The two principal suspects who puzzlingly were never charged, worked as microbiologists at Fort Detrick. Of the two, Bruce Ivins, who was the more culpable, died in 2008 of “suicide”. For “suicide”, read “elimination”, probably because he was in the process of spilling the beans and therefore cast the US government in a stigmatically diabolical light. Indeed, the following year, all research projects at Fort Detrick were suspended on grounds that the institute was “storing pathogens not listed in its database”. The real truth was likely much more reprehensible.
In 2014, there was a mini local pandemic in the US which killed thousands of people and which the mainstream media were not gutsy enough to report. It arose following the weaponisation at Fort Detrick of the H7N9 virus, prompting the Obama administration to at once declare a moratorium on the research and withdraw funding.
The Trump administration, however, which has a pathological fixation on undoing practically all the good Obama did, reinstated the research under new rigorous guidelines in 2017. But since old habits die hard, the new guidelines were flouted at will, leading to another shutdown of the whole research gamut at the institute in August 2019. This, nonetheless, was not wholesale as other areas of research, such as experiments to make bird flu more transmissible and which had begun in 2012, proceeded apace. As one commentator pointedly wondered aloud, was it really necessary to study how to make H5N1, which causes a type of bird flu with an eye-popping mortality rate, more transmissible?
Consistent with its character, the CDC was not prepared to furnish particulars upon issuing the cease and desist order, citing “national security reasons”. Could the real reason have been the manufacture of the novel coronavirus courtesy of a tip-off by the more scrupulous scientists?
President Mokgweetsi Masisi may have breathed a huge sigh of relief when he emerged victorious in last year’s 2019 general elections, but the ultimate test of his presidency has only just begun.
From COVID-19 pandemic effects; disenchanted unemployed youth, deteriorating diplomatic relations with neighbouring South Africa as well as emerging instability within the ruling party — Masisi has a lot to resolve in the next few years.
Last week we started an unwanted cold war with Botswana’s main trade partner, South Africa, in what we consider an ill-conceived move. Never, in the history of this country has Botswana shown South Africa a cold shoulder – particularly since the fall of the apartheid regime.
It is without a doubt that our country’s survival depends on having good relations with South Africa. As the Chairperson of African National Congress (ANC), Gwede Mantashe once said, a good relationship between Botswana and South Africa is not optional but necessary.
No matter how aggrieved we feel, we should never engage in a diplomatic war — with due respect to other neighbours— with South Africa. We will never gain anything from starting a diplomatic war with South Africa.
In fact, doing so will imperil our economy, given that majority of businesses in the retail sector and services sector are South African companies.
Former cabinet minister and Phakalane Estates proprietor, David Magang once opined that Botswana’s poor manufacturing sector and importation of more than 80 percent of the foodstuffs from South Africa, effectively renders Botswana a neo-colony of the former.
Magang’s statement may look demeaning, but that is the truth, and all sorts of examples can be produced to support that. Perhaps it is time to realise that as a nation, we are not independent enough to behave the way we do. And for God’s sake, we are a landlocked country!
Recently, the effects of COVID-19 have exposed the fragility of our economy; the devastating pleas of the unemployed and the uncertainty of the future. Botswana’s two mainstay source of income; diamonds and tourism have been hit hard. Going forward, there is a need to chart a new pathway, and surely it is not an easy task.
The ground is becoming fertile for uprisings that are not desirable in any country. That the government has not responded positively to the rising unemployment challenge is the truth, and very soon as a nation we will wake up to this reality.
The magnitude of the problem is so serious that citizens are running out of patience. The government on the other hand has not done much to instil confidence by assuring the populace that there is a plan.
The general feeling is that, not much will change, hence some sections of the society, will try to use other means to ensure that their demands are taken into consideration. Botswana might have enjoyed peace and stability in the past, but there is guarantee that, under the current circumstances, the status quo will be maintained.
It is evident that, increasingly, indigenous citizens are becoming resentful of naturalised and other foreign nationals. Many believe naturalised citizens, especially those of Indian origin, are the major beneficiaries in the economy, while the rest of the society is side-lined.
The resentfulness is likely to intensify going forward. We needed not to be heading in this direction. We needed not to be racist in our approach but when the pleas of the large section of the society are ignored, this is bound to happen.
It is should be the intention of every government that seeks to strive on non-racialism to ensure that there is shared prosperity. Share prosperity is the only way to make people of different races in one society to embrace each other, however, we have failed in this respect.
Masisi’s task goes beyond just delivering jobs and building a nation that we all desire, but he also has an immediate task of achieving stability within his own party. The matter is so serious that, there are threats of defection by a number of MPs, and if he does not arrest this, his government may collapse before completing the five year mandate.
The problems extend to the party itself, where Masisi found himself at war with his Secretary General, Mpho Balopi. The war is not just the fight for Central Committee position, but forms part of the succession plan.