Connect with us
Advertisement

Informal sector critical for employment creation

Unlike in other countries with high unemployment rates, workers in Botswana have not engaged in widespread self-employment despite a lack of wage employment opportunities in the country. In a review carried in the Bank of Botswana (BoB) Annual Report for 2015, the central bank has decried high unemployment rate citing the small informal sector among the causes.

Growth of the sector is said to be impeded by among others lack of access to infrastructure and services, insufficient skills, low entrepreneurial drive, and rigid trade and land use regulations.

A generous social and family support system was also named as a culprit as “it could also reduce incentives to engage in informal income earning activity.”
The review pointed to evidence from other countries which suggests that the informal sector can be a source of employment opportunities, and emphasized the need to accommodate growth of informal enterprises and recognize them as partners in development.

The banking regulator suggested the provision of an enabling environment by addressing the infrastructure deficit, creating markets, and increasing access to vocational training which includes financial literacy. The bank also proposed the formulation of a comprehensive informal sector policy citing that it would balance the need for regulation with promoting economic activity and expansion of income earning opportunities.

An informal sector survey conducted in 2015 estimates that the informal sector in Botswana employs 191 000 people as of March 2015, which constitutes approximately 31% of total employment. The sector contributes an estimated 5.3% to the country’s Gross Domestic Product (GDP)

Similar sentiments are echoed by David Menyah in a PhD thesis titled The Informal Sector Revisited: Botswana’s Developmental State and Micro Enterprise Development.  The study focused on enterprises in Gaborone and found that the sector serves as an important livelihood strategy for the many engaged in it through income and employment generation.

The informal sector in Gaborone is dominated by retail, service and manufacturing respectively. Menyah observed that manufacturing was the most difficult to participate in due to constraints such as lack of suitable premises and lack of prerequisite skills and finance. The enterprises also used low levels of technology. He also observed that while over two thirds of sampled enterprises indicated that they had grown, with manufacturing recording the highest incidence of growth, their employment characteristics indicated low potentiality for growth. Most, he says, are owner operated with no permanent employees. “Less than 5% had plans to employ workers,” he asserts.

Menyah recommends that since most enterprises are owner operated, other forms of ownership like partnerships or cooperatives should be encouraged for purposes of a collective effort to ensure synergies and sharing of ideas. He suggests that government’s procurement processes and requirement should be revisited to make it easy for the informal sector enterprises to access government market. He proposes that permanent structures should be made available for the enterprises to operate from. He suggests upgrading and modernisation of technology used as poor technology and equipment compromises productivity. Finally, he recommends formulation of a comprehensive informal sector development policy.

The relationship between government and the informal sector has been other than cordial.  In Gaborone, police often fine vendors and confiscate their wares if they fail to pay.

The Thusanang Bagwebi Association (TBA), an association representing street vendors in the city, has handed petitions to successive mayors over what they termed “harassment by council officials.” Last year, 20 vendors operating in the Francistown bus rank stormed Francistown East constituency offices seeking the intervention of Member of Parliament (MP), Buti Billy. The vendors asked the parliamentarian to rein in council officials whom they said were harassing them and interfering with their small businesses.

Continue Reading

News

Opposition Will Never Achieve Anything- Nkaigwa

8th April 2021
Haskins Nkaigwa

Former Umbrella for Democratic Change (UDC) Member of Parliament for Gaborone North, Haskins Nkaigwa has confirmed his departure from opposition fold to re-join the ruling Botswana Democratic Party (BDP).

Nkaigwa said opposition is extremely divided and the leadership not in talking terms.  “They are planning evil against each other. Nothing much will be achieved,” Nkaigwa told WeekendPost.

“I believe my time in the opposition has come to an end. It’s time to be of value to rebuilding our nation and economy of the country. Remember the BDP is where I started my political journey. It is home,” he said.

“Despite all challenges currently facing the world, President Masisi will be far with his promises to Batswana. A leader always have the interest of the people at heart despite how some decisions may look to be unpopular with the people.

“I have faith and full confidence in President Dr Masisi leadership. We shall overcome as party and nation the current challenges bedevilling nations. BDP will emerge stronger. President Masisi will always have my backing.”

Nkaigwa served as opposition legislator between 2014-2019 representing Botswana Movement for Democracy (BMD) under UDC banner.  He joined BMD in 2011 at the height public servant strike whilst Gaborone City Deputy Mayor. He eventually rose to become the mayor same year, after BDP lost majority in the GCC.

Nkaigwa had been a member of Botswana National Front (BNF), having joined from Alliance for Progressives (AP) in 2019.

Continue Reading

News

Botswana benefits over P100 million in grants from Japan

7th April 2021
Ambassador HOSHIYAMA

Botswana has received assistance worth over P100 million from Japanese government since 2019, making the latter of the largest donors to Botswana in recent years.

The assistance include relatively large-scale grant aid programmes such as the COVID-19 programme (to provide medical equipment; P34 million), the digital terrestrial television programme (to distribute receivers to the underprivileged, P17 million), the agriculture promotion programme (to provide agricultural machinery and equipment, P53million).

“As 2020 was a particularly difficult year, where COVID-19 hit Botswana’s economy and society hard, Japan felt the need to assist Botswana as our friend,” said Japan’s new Ambassador to Botswana, Hoshiyama Takashi.

“It is for this reason that grants of over P100 million were awarded to Botswana for the above mentioned projects.”

Japan is now the world’s fourth highest ranking donor country in terms of Official Development Assistance (ODA).

From 1991 to 2000, Japan continued as the top donor country in the world and contributed to Asia’s miracle economic development.

From 1993 onwards, the TICAD process commenced through Japan’s initiative as stated earlier. Japan’s main contribution has been in the form of Yen Loans, which are at a concessional rate, to suit large scale infrastructure construction.

“In Botswana, only a few projects have been implemented using the Yen Loan such as the Morupule “A” Power Station Rehabilitation and Pollution Abatement in 1986, the Railway Rolling Stock Increase Project in 1987, the Trans-Kalahari Road Construction Project in 1991, the North-South Carrier Water Project in 1995 and the Kazungula Bridge Construction Project in 2012,” said Ambassador Hoshiyama.

“In terms of grant aid and technical assistance, Japan has various aid schemes including development survey and master planning, expert dispatch to recipient countries, expert training in Japan, scholarships, small scale grass-roots program, culture-related assistance, aid through international organizations and so on.”

In 1993, Japan launched Tokyo International Conference on African Development (TICAD) to promote Africa’s development, peace and security, through the strengthening of relations in multilateral cooperation and partnership.

TICAD discuss development issues across Africa and, at the same time, present “aid menus” to African countries provided by Japan and the main aid-related international organizations, United Nations (UN), United Nations Development Programme (UNDP) and the World Bank.

“As TICAD provides vision and guidance, it is up to each African country to take ownership and to implement her own development following TICAD polices and make use of the programmes shown in the aid menus,” Ambassordor Hoshiyama noted.

“This would include using ODA loans for quality infrastructure, suited to the country’s own nation-building needs. It is my fervent hope that Botswana will take full advantage of the TICAD process.”

Since then, seven conferences where held, the latest, TICAD 7 being in 2019 at Yokohama. TICAD 7’s agenda on African development focused on three pillars, among them the first pillar being “Accelerating economic transformation and improving business environment through innovation and private sector engagement”.

“Yes, private investment is very important, while public investment through ODA (Official Development Assistance) still plays an indispensable role in development,” the Japanese Ambassador said.

“For further economic development in Africa, Japan recognizes that strengthening regional connectivity and integration through investment in quality infrastructure is key.”

Japan has emphasized the following; effective implementation of economic corridors such as the East Africa Northern Corridor, Nacala Corridor and West Africa Growth Ring; Quality infrastructure investment in line with the G20 Principles for Quality Infrastructure Investment should be promoted by co-financing or cooperation through the African Development Bank (AfDB) and Japan.

Japan also emphasized the establishment of mechanisms to encourage private investment and to improve the business environment.

According to the statistics issued by Japan’s Finance Ministry, Japan invested approximately 10 billion US dollars in Africa after TICAD 7 (2019) to year end 2020, but Japanese investment through third countries are not included in this figure.

“With the other points factored in, the figure isn’t established yet,” Ambassador Hoshiyama said.

The next conference, TICAD 8 will be held in Tunisia in 2022. This will be the second TICAD summit to be held on the African continent after TICAD 6 which was held in Nairobi, Kenya, in 2016.

According to Ambassador Hoshiyama, in preparation for TICAD 8, the TICAD ministerial meeting will be held in Tokyo this year. The agenda to be discussed during TICAD 8 has not yet been fully deliberated on amongst TICAD Co-organizers (Japan, UN, UNDP, the World Bank and AU).

“Though not officially concluded, given the world situation caused by COVID-19, I believe that TICAD 8 will highlight health and medical issues including the promotion of a Universal Health Coverage (UHC),” said Hoshiyama.

“As the African economy has seriously taken a knock by COVID-19, economic issues, including debt, could be an item for serious discussion.”

The promotion of business is expected to be one of the most important topics. Japan and its partners, together with the business sector, will work closely to help revitalize private investment in Africa.

 

“All in all, the follow-up of the various programs that were committed by the Co-Organizers during the Yokohama Plan of Actions 2019 will also be reviewed as an important item of the agenda,” Ambassador Hoshiyama said.

“I believe that this TICAD follow-up mechanism has secured transparency and accountability as well as effective implementation of agreed actions by all parties. The guiding principle of TICAD is African ownership and international partnership.”

Continue Reading

News

Magosi pushes for Cabinet reshuffle

6th April 2021
President Masisi

Directorate on Intelligence Services (DIS) Director General, Brigadier Peter Magosi is said to be hell-bent and pushing President Mokgweetsi Masisi to reshuffle his cabinet as a matter of urgency since a number of his ministers are conflicted.

The request by Magosi comes at a time when time is ticking on his contract which is awaiting renewal from Masisi.

This publication learns that Magosi is unshaken by the development and continues to wield power despite uncertainty hovering around his contractual renewal.

This content is locked

Login To Unlock The Content!

 

Continue Reading
Do NOT follow this link or you will be banned from the site!