Botswana’s retail sector which is worth over P15 billion annually had seen battle between the Minister of Investment, Trade and Industry, Vincent Seretse following his decision to demand citizen component in ownership of retail shops operating in various malls in the country.
Minister Seretse’s new thumb rule was a requisite for operation permit renewal and this irked retailers and part of the business community. But this week the Minister declared victory, saying the retailers were compliant and results have started showing. The reservation of certain trade activities for citizens and citizen owned companies was emphasized in 2015 and aggressive implementation followed in 2016 spearheaded by Minister Seretse. The Minister said results as far as Citizen Economic Empowerment is have started showing and the reservations are provided for in Section 15.1 of the Trade Act of 2003.
According to Seretse, the reservation of these trade activities was premised on the fact that some retail operations are easy to operate and do not need technical expertise, special technology or special skills and therefore could be operated by citizens. Some of the reserved business activities include general dealer, general clothing, fresh produce, take away, hair and beauty parlor, among others.
Seretse made the statements in Parliament when answering a question asked by Specially Elected Member of Parliament, Bogolo Kenewendo. Kenewendo wanted the Minister to inform parliament of the impact of the reservation policy in the retail sector on the economy of Botswana.
“I ask this question because the retail sector is extremely important in our economy. It has been one sector that has been grossing double digits growth numbers, and the retail sector as a sub sector of the trade sector has also been quite important in cross border trading. It has accounted to about thirty- two (32) per cent of the total trade sector and has grown at around 5.2 per cent in the last decades,” Kenewendo said.
She explained that Retail activity has been quite crucial for employment as well. “The combined impact of the retail sector and the wholesales sector has been around 48 to 50 000 when it comes to job creation which is around fourteen (14) per cent of total formal employment.’”
Kenewendo who is also a Trade and Financial Economics expert said that upon revising the Trade Act, it was outlined that some economic activities will be reserved for citizens, and therefore there cannot be any foreign participation, “but previously we would find that the Minister would exempt some foreign owned retail chains in particular for clothing; Markham’s, Woolworths, Mr Price, Pep and so forth.
We heard last year and the year before that this has changed a bit, and that some of these chains have been withdrawing or are threatening to withdraw their investment in Botswana and are looking elsewhere because this Reservation Policy is being implemented quite harshly, So, I ask for the Minister to brief us if there has been any study to look at the impact of this Reservation Policy in particular on the retail sector,” she enquired further.
The specially elected MP had also asked whether there was any success noted in relation to the policy being implemented; “why are we not seeing any more exemptions, or really just to clarify if there are some of those exemptions, and what has been the total impact on employment creation?”
Seretse, in response said the implementation of reservation and reducing exemption has opened opportunities for citizens to participate in the retail sector such as bakery, fresh produce which has been in the domain of chain stores. “The economic growth of the country is suitable when it is driven by its own citizens. This results in the development of entrepreneurial skills and consequently improvement in the wellbeing of the people. The profit generated from the reserved business activities are re-injected into the economy and hence reduce the leakages of income that goes to other countries,” said Seretse.
Parliament also learnt that the reserved businesses under the Economic Diversification Drive (EDD) include manufacturing services and agricultural production. According to the minister, procurement from producers in these sectors will in the medium to long term lead to competitiveness which will encourage retail sectors currently dependent on imports to source products locally.
Furthermore, Seretse who is also Member of Parliament for Lentsweletau explained that foreign retailers who are mainly South African were engaged and brought to the table pertaining to the new developments. “We gave them an opportunity when this came into force that they must, when they expand, involve Batswana, because we could not impose the Act retrospectively, if they want to be in that space.”
Seretse noted that for a number of years his ministry continuously gave them exemptions: “Upon realizing that, they are taking advantage of this Clause which gives them exemptions, we decided that we shall stop the exemptions and put to them that they must try and get Batswana involved.” Seretse, who was criticized by the Lekwalo Leta Mosianyane led private sector advocacy federation, Business Botswana, explained that the Act provides for 51 percent of partnerships for new outlets.
“When I stopped the exemptions, they raised these issues like their companies are listed, so it is very difficult to engage Batswana to be participating in this space. For me that argument did not make sense because I decided that I meet all of them, the owners of the businesses that are operating here, the real Directors not the rented people who are sometimes called Country Managers this side who do not make decisions.” Seretse further told parliament that arguments brought forward by South African retailers did not hold water.
“I will give you one reason that they used, they said, ‘no, our staff is in the pension fund, we have given them some 1 per cent.’ I said I am not interested in that, I want significant contribution that will contribute to the economy. They went all over to try and get the support. I stood my ground, and basically said, I am not saying give your companies away at 51 per cent, I am asking you as a responsible Government to do something that you will feel comfortable with which is contributing to the economy.”
The Minister observed that his argument was based on empowering locals and he noted some of the business he advanced for was manufacturing enterprises, “I told them that some of the things that they could do was to engage our local manufacturing companies to supply them with goods. The argument was that the local people are very expensive and they cannot meet their standards. I said then we have to do something about it. You have to make sure that they meet your standards,” the Letsweletau Legislator quipped. Adding that he won his argument by stressing that local suppliers were expensive because they were still growing and if that was to be used as a factor, it would mean that Botswana would never grow its manufacturing sector.
The minister further revealed that retailers, so far were holding their end of the deal with respect to terms and conditions agreed upon “They threatened that they will go somewhere else. I knew they would not go because their profit lines are supported by our industries and for their businesses to grow they need us to support them through our purchases,” he said.
To date, he emphasized, no retailer had left the lucrative 15 billion Botswana market space. “To date, since you asked, even though they had threatened to leave, not a single company has gone. They are still here,” he stated, in direct response to Kenewendo. He further added that one of the conditions of exemption was that there must be a good cause that is practical to the effect that indeed Batswana are engaged.
“First we said we want to see Batswana products in their shops,” he noted adding that they committed that they would provide 10 percent of their floor space for goods produced by Batswana.” There also is commitment that the retailers will join forces with Botswana Government in training the suppliers to meet their standards. According to him, the first workshop was held a fortnight ago by Edcon which operates 10 different stores locally.
“There were about 100 Batswana who have shown interest that they are able to supply them. There is a clear programme that is to be followed. We also said that because our people might be starting from the beginning, there must be progressive quantities that you would be able to get from these different suppliers so that if all goes well as I would wish, at a particular point in time, these shops must be supplied probably if not 100 per cent, more than 60 per cent with local products,” he explained highlighting that their efforts are progressively benefiting Batswana.
While there is no hard-and-fast rule in politics, former Molepolole North Member of Parliament, Mohamed Khan says populism acts in the body politic have forced him to quit active partisan politics. He brands this ancient ascription of politics as fake and says it lowers the moral compass of the society.
Khan who finally tasted political victory in the 2014 elections after numerous failed attempts, has decided to leave the ‘dirty game’, and on his way out he characteristically lashed at the current political leaders; including his own party president, Advocate Duma Boko. “I arrived at this decision because I have noticed that there are no genuine politics and politicians. The current leaders, Boko and President Dr Mokgweetsi Masisi are fake politicians who are just practicing populist politics to feed their egos,” he said.
Former Botswana Democratic Party (BDP) parliamentary hopeful, Lawrence Ookeditse has rejected the idea of taking up a crucial role in the Botswana Patriotic Front (BPF) Central Committee following his arrival in the party this week. According to sources close to development, BPF power brokers are coaxing Ookeditse to take up the secretary general position, left vacant by death of Roseline Panzirah-Matshome in November 2020.
Ookeditse’s arrival at BPF is projected to cause conflicts, as some believe they are being overlooked, in favour of a new arrival. The former ruling party strategist has however ruled out the possibility of serving in the party central committee as secretary general, and committed that he will turn down the overture if availed to him by party leadership.
Ookeditse, nevertheless, has indicated that if offered another opportunity to serve in a different capacity, he will gladly accept. “I still need to learn the party, how it functions and all its structures; I must be guided, but given any responsibility I will serve the party as long as it is not the SG position.”
“I joined the BPF with a clear conscious, to further advance my voice and the interests of the constituents of Nata/Gweta which I believe the BDP is no longer capable to execute.” Ookeditse speaks of abject poverty in his constituency and prevalent unemployment among the youth, issues he hopes his new home will prioritise.
He dismissed further allegations that he resigned from the BDP because he was not rewarded for his efforts towards the 2019 general elections. After losing in the BDP primaries in 2018, Ookeditse said, he was offered a job in government but declined to take the post due to his political ambitions. Ookeditse stated that he rejected the offer because, working for government clashed with his political journey.
He insists there are many activists who are more deserving than him; he could have chosen to take up the opportunity that was before him but his conscious for the entire populace’s wellbeing held him back. Ookeditse said there many people in the party who also contributed towards party success, asserting that he only left the BDP because he was concerned about the greater good of the majority not individualism purposes.
According to observers, Ookeditse has been enticed by the prospects of contesting Nata/Gweta constituency in the 2024 general election, following the party’s impressive performance in the last general elections. Nata/Gweta which is a traditional BDP stronghold saw its numbers shrinking to a margin of 1568. BDP represented by Polson Majaga garnered 4754, while BPF which had fielded Joe Linga received 3186 with UDC coming a distant with 1442 votes.
There are reports that Linga will pave way for Ookeditse to contest the constituency in 2024 and the latter is upbeat about the prospects of being elected to parliament. Despite Ookeditse dismissing reports that he is eying the secretary general position, insiders argue that the position will be availed to him nevertheless.
Alternative favourite for the position is Vuyo Notha who is the party Deputy Secretary General. Notha has since assumed duties of the secretariat office on the interim basis. BPF politburo is expected to meet on 25th of January 2020, where the vacancy will be filled.
Botswana Democratic Party (BDP) big wigs have decided to cancel a retreat with the party legislators this weekend owing to increasing numbers of Covid-19 cases. The meeting was billed for this weekend at a place that was to be confirmed, however a communique from the party this past Tuesday reversed the highly anticipated meeting.
“We received a communication this week that the meeting will not go as planned because of rapid spread of Covid-19,” one member of the party Central Committee confirmed to this publication. The gathering was to follow the first of its kind held late last year at party Treasurer Satar Dada’s place.