Screws have been tightened in the world of gambling as the new gambling regime has stepped in to supervise gambling activity as well as issuing licenses.
New regulations approved in terms of the Gambling Act 2012 signed off by the Minister of Trade and Industry in January will be implemented at the nation’s ten land casinos through a new regulatory body, Gambling Authority.
Familiarizing with the media this week, the Gambling Authority CEO, Thulisizwe Johnson expressed that with the measures in place all the plagues in the industry would be dealt with.
The measures enable the commencement of 2012’s Gambling Act, which provides for the establishment of a fund made of all the levies imposed under the Act and the establishment of the excessive gambling prevention and rehabilitation committee.
The gambling business in Botswana has spread at a very fast pace and there have been lots of complaints about the ills that plague it. The new regulations are intended to protect the interests of individual gamblers while also ensuring that the government generates the maximum possible revenues from it.
The gambling watchdog is in the process of taking over the existing casinos and anyone wishing to be involved in any other kind of betting, including sms and online will need to be registered and licensed with the Authority first.
“All the new requirements are meant to curb illegal gambling and protect the licensed operators who do not only pay tax but also have jobs to protect,” Johnson highlighted.
Another important aspect of the new gambling regulations is that it is designed to control money laundering. Under the new regulations, any gambling operation, betting premises, gambling machines and key personnel will be required to have a license. The Authority will also start to electronically supervise all betting operations transactions with casino operators, which are required to install surveillance equipment, to monitor possible money laundering and other crimes.
While regulations governing the operations of land casinos are extensive, Johnson admitted that more work still needs to be done on a strong and appropriate regulatory framework for virtual betting including online and sms-based competitions and sports betting.
Prior to the Gambling Act, was the Lotteries and Betting Act, The Casino Control Act. The regulator was known as the Casino Control Board and it worked with a Secretariat housed in the Ministry of Investment Trade and Industry (MITI)
Johnson added that through the exercise by any of its officers, or any person authorised by it, to enter and inspect any gambling establishment at such times and such manner as it may consider necessary to ascertain whether the terms and conditions of a licence are being observed; and
The Licences shall be awarded for a period of 10 years unless revoked or renewed. The licences covered by the act include Lottery Licence,Lottery Machine Licence, Racing Licence,Testing Agent Licence,Totalisator Licence
He added that as an authority they will ensure the weak and vulnerable must be protected at all times.
“There must be a risk management policy developed by licensees to spot and stop irresponsible and reckless gambling. As you do not have physical contact a in the case of a land-based establishment, development of an oversight programme that includes number of times and amounts gambled is necessary to demonstrate,” he stated.
Casinos will have to pay a P250,000 (US$22,500) registration fee, while betting houses, bingos and lotteries will pay P50,000, P10,000 and P1 million, respectively.â€¨â€¨
This century is always looking at improving new super high speed technology to make life easier. On the other hand, beckoning as an emerging fierce reversal force to equally match or dominate this life enhancing super new tech, comes swift human adversaries which seem to have come to make living on earth even more difficult.
The recent discovery of a pandemic, Covid-19, which moves at a pace of unimaginable and unpredictable proportions; locking people inside homes and barring human interactions with its dreaded death threat, is currently being felt.
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”