Connect with us
Advertisement

Tibone warns BDP could lose power

Former cabinet minister and business magnate, Charles Tibone has warned that the ruling Botswana Democratic Party (BDP) faces real danger of losing power if there is continued failure by government to inspire private sector growth and economic diversification.

Speaking at the Annual Grant Thorn Private Business Growth Awards held in Gaborone this week, Tibone said government can no longer afford to allow the diversification nut to go on un-cracked for much longer if it is to remain in power. 

“Theoretically, if a government fails to diversify the economy to a point where this becomes a national concern, people can vote it out of power,” warned Tibone.

“But if the private sector fails to grow their business to a point where that becomes a national concern, the economy collapses. That is worse than being voted out of power. ”

Tibone, who served as Minister of Minerals, Energy and Water Resources under President Festus Mogae’s tenure, stated that government’s dominance in most sectors has proved to be a hindrance for high economic growth rates.

Tibone further observed that the trend further compromises positive investment ratings and leads to increased unemployment and failure to diversify the economy.

“We have received enough warnings about the need to find alternatives to diamonds as the mainstay in our economy. That matter is urgent,” he said.

The former Tati West legislator remarked that Botswana has received accolades on conditions which would ordinarily make the country’s economy grow.

“As a people, we are exceptionally peaceful. This was confirmed by Ban KI Moon [United Nations Secretary General] at our BOT50 celebration in New York. On corruption we are ranked lowest in Africa. The Mo Ibrahim index ranks us high. Yet all these good attributes do not translate into a tailwind that propels growth and diversification of the economy,” he said.

“Last year we nearly ended the recession at 0.3 percent growth rate. This year 3.6 percent expected. And for next year 4.6 percent, these are not robust growth rates. Rwanda and Tanzania are able to achieve 6 percent, why can’t we?”

Tibone further advised that government does away with some public enterprises which are dampening the potential of growth in the private sector in some businesses.

“What is even more concerning is that the majority of these parastatals businesses are chronically unprofitable. They operate on negative returns on investment or on life support from Government through subsidies,” he said.

“A case can be made for parastatals that provide a social service like Water Utilities Corporation (WUC) or those which regulate sectors such as Botswana Communication Regulatory Authority (BOCRA) or Civil Aviation Authority (CAAB).”

Tibone does not see any reason for government to continue keeping public enterprises which have become weak after being owned by government for decades.

“One may ask; do we really need a national airline? Have we not done enough to demonstrate that passenger traffic exists? Nigeria, The United States of America, Hong Kong and many other countries do not have national airlines and yet traffic into these states remains strong,” he said.

“Is it vital that National Development Bank (NDB), Botswana Development Corporation (BDC), Botswana Savings Bank (BSB) and Botswana Meat Commission (BMC), to mention just a few, should continue to be Government owned?”

Tibone, who resigned as Assistant Minister of Finance in 2011, and left his law making position in 2014, argued that if compared, growth profiles of the BDC and BIHL, both of which are in property and financial services, among other investments, one will notice that one zigzags up and down while the other has an upward trajectory.

“It will not be difficult to guess which one is parastatal,” he said.

“Massive injection of state resources into that entity has not guaranteed growth. This evidence therefore leads one to the observation that there is a distinct prospect that the privatisation of a number of Government parastatals would not simply lead to quantitative growth of our private sector but possibly a dramatic transformation of our economy.”

According to Tibone, most countries that have experienced phenomenal economic growth have acknowledged that encouraging private sector growth is an imperative.

Tibone said there is a culture of making right policy pronouncements about private enterprise but on the ground, the country has failed to resist the gravitation pull of welfare state programs.

He said this is understandable since Botswana comes from a background where everything had to be initiated by Government.

“But the economic circumstances we are now in require that we should rapidly transition ourselves from welfare state into a truly private sector led economy. This will mean that we have to accelerate the privatization of parastatals,” he said.

“For over two decades we have been talking privatization. But not much has happened. Yes when we started there was no urgency because we still had budget surpluses. Things have changed. Budget deficits over 4 percent of GDP are projected.”

Tibone is of the view that government should disinvest from certain sectors, as it heads to privatisation and possibly listing on the Stock Exchange, which will provide necessary revenue to finance deficits.

He also said there are vast opportunities in agriculture as well as information technology, which he said, if harnessed properly, could create thousands of jobs.

“I was impressed to learn that some of the major retailers in the country have given suppliers of agricultural produce a commitment to buy all their production before turning to outside suppliers. This reduces the risk to the farming entities significantly and creates opportunities,” he expressed.

Continue Reading

News

Masisi to dump Tsogwane?

28th November 2022

Botswana Democratic Party (BDP) and some senior government officials are abuzz with reports that President Mokgweetsi Masisi has requested his Vice President, Slumber Tsogwane not to contest the next general elections in 2024.

This content is locked

Login To Unlock The Content!

Continue Reading

News

African DFIs gear to combat climate change

25th November 2022

The impacts of climate change are increasing in frequency and intensity every year and this is forecast to continue for the foreseeable future. African CEOs in the Global South are finally coming to the party on how to tackle the crisis.

Following the completion of COP27 in Egypt recently, CEOs of Africa DFIs converged in Botswana for the CEO Forum of the Association of African Development Finance Institutions. One of the key themes was on green financing and building partnerships for resource mobilization in financing SDGs in Africa

A report; “Weathering the storm; African Development Banks response to Covid-19” presented shocking findings during the seminar. Among them; African DFI’s have proven to be financially resilient, and they are fast shifting to a green transition and it’s financing.

COO, CEDA, James Moribame highlighted that; “Everyone needs food, shelter and all basic needs in general, but climate change is putting the achievement of this at bay. “It is expensive for businesses to do business, for instance; it is much challenging for the agricultural sector due to climate change, and the risks have gone up. If a famer plants crops, they should be ready for any potential natural disaster which will cost them their hard work.”

According to Moribame, Start-up businesses will forever require help if there is no change.

“There is no doubt that the Russia- Ukraine war disrupted supply chains. SMMEs have felt the most impact as some start-up businesses acquire their materials internationally, therefore as inflation peaks, this means the exchange rate rises which makes commodities expensive and challenging for SMMEs to progress. Basically, the cost of doing business has gone up. Governments are no longer able to support DFI’s.”

Moribame shared remedies to the situation, noting that; “What we need is leadership that will be able to address this. CEOs should ensure companies operate within a framework of responsible lending. They also ought to scout for opportunities that would be attractive to investors, this include investors who are willing to put money into green financing. Botswana is a prime spot for green financing due to the great opportunity that lies in solar projects. ”

Technology has been hailed as the economy of the future and thus needs to be embraced to drive operational efficiency both internally and externally.

Executive Director, bank of Industry Nigeria, Simon Aranou mentioned that for investors to pump money to climate financing in Africa, African states need to be in alignment with global standards.

“Do what meets world standards if you want money from international investors. Have a strong risk management system. Also be a good borrower, if you have a loan, honour the obligation of paying it back because this will ensure countries have a clean financial record which will then pave way for easier lending of money in the future. African states cannot just be demanding for mitigation from rich countries. Financing needs infrastructure to complement it, you cannot be seating on billions of dollars without the necessary support systems to make it work for you. Domestic resource mobilisation is key. Use public money to mobilise private money.” He said.

For his part, the Minster of Minister of Entrepreneurship, Karabo Gare enunciated that, over the past three years, governments across the world have had to readjust their priorities as the world dealt with the effects and impact of the COVID 19 pandemic both to human life and economic prosperity.

“The role of DFIs, during this tough period, which is to support governments through countercyclical measures, including funding of COVID-19 related development projects, has become more important than ever before. However, with the increasingly limited resources from governments, DFIs are now expected to mobilise resources to meet the fiscal gaps and continue to meet their developmental mandates across the various affected sectors of their economies.” Said Gare.

Continue Reading

News

TotalEnergies Botswana launches Road safety campaign in Letlhakeng

22nd November 2022

Letlhakeng:TotalEnergies Botswana today launched a Road Safety Campaign as part of their annual Stakeholder Relationship Management (SRM), in partnership with Unitrans, MVA Fund, TotalEnergies Letlhakeng Filling Station and the Letlhakeng Sub District Road Safety Committee during an event held in Letlhakeng under the theme, #IamTrafficToo.

The Supplier Relationship Management initiative is an undertaking by TotalEnergies through which TotalEnergie annually explores and implements social responsibility activities in communities within which we operate, by engaging key stakeholders who are aligned with the organization’s objectives. Speaking during the launch event, TotalEnergies’ Operations and HSSEQ,   Patrick Thedi said,  “We at TotalEnergies pride ourselves in being an industrial operator with a strategy centered on respect, listening, dialogue and stakeholder involvement, and a partner in the sustainable social and economic development of its host communities and countries. We are also very fortunate to have stakeholders who are in alignment with our organizational objectives. We assess relationships with our key stakeholders to understand their concerns and expectations as well as identify priority areas for improvement to strengthen the integration of Total Energies in the community. As our organization transitions from Total to Total Energies, we are committed to exploring sustainable initiatives that will be equally indicative of our growth and this Campaign is a step in the right direction. ”

As part of this campaign roll out, stakeholders  will be refurbishing and upgrading and installing road signs around schools in the area, and generally where required. One of the objectives of the Campaign is to bring awareness and training on how to manage and share the road/parking with bulk vehicles, as the number of bulk vehicles using the Letlhakeng road to bypass Trans Kalahari increases. When welcoming guests to Letlhakeng, Kgosi Balepi said he welcomed the initiative as it will reduce the number of road incidents in the area.

Also present was District Traffic Officer ASP, Reuben Moleele,  who gave a statistical overview of accidents in the region, as well as the rest of the country. Moleele applauded TotalEnergies and partners on the Campaign, especially ahead of the festive season, a time he pointed out is always one with high road statistics. The campaign name #IamTrafficToo, is a reminder to all road users, including pedestrians that they too need to be vigilant and play their part in ensuring a reduction in road incidents.

The official proceedings of the day included a handover of reflectors and stop/Go signs to the Letlhakeng Cluster from TotalEnerigies, injury prevention from tips from MVA’s Onkabetse Petlwana, as  well as  bulk vehicle safety tips delivered from Adolf Namate of Unitrans.

TotalEnergies, which is committed to having zero carbon emissions by 2050,  has committed to rolling out the Road safety Campaign to the rest of the country in the future.

Continue Reading