The Chinese Ambassador to Botswana H.E. Zheng Zhuqiang is confident that Botswana – China relations have not taken a knock. “I have every confidence in the future growth of China-Botswana relations,” he said.
Speaking on China-Botswana relationship, Zheng noted that this year also marks the 40th anniversary of the establishment of diplomatic ties between our two countries. He also pinned his observations on today’s China-Botswana relations under the framework of FOCAC, and what China-Botswana relationship could benefit from FOCAC.
Zheng said the friendship between China and Botswana is well established and long lasting.
“Since the establishment of diplomatic relations in 1975, especially after the set-up of FOCAC in 2000, our bilateral exchanges and cooperation in all areas have been improved greatly thanks to the effective implementation of FOCAC initiatives by both sides. For the past 15 years, our two countries have enjoyed frequent high level exchanges. Former Botswana President H.E. Mogae attended the first FOCAC summit in Beijing in 2006, and Botswana has attended all the 5 previous FOCAC conferences,” he observed.
Bilateral economic and trade cooperation between the two countries has been pushed forward greatly under the framework of FOCAC, said Zheng. The bilateral trade volume was US$11 million back in 2000, while this number has increase almost 30 times to around US$300 million in 2014, making China one of the largest trading partners of Botswana and the second largest consumer of Botswana’s diamonds.
Zheng said under the guideline of FOCAC, China has been providing selfless assistance to Botswana, out of which 32 projects have been implemented.
On infrastructure area, Zheng said China has helped to renovate 587-kilometer-long railway, build 200-kilometer-long Letlhakeng-Kang road, 717 residential houses and Gaborone Multi-purpose Youth Center, etc. On the education front, China has donated and built 2 primary schools and is willing to donate 2 more in the coming years. China has provided more than 550 scholarships and 1000 short-term training opportunities to support Botswana’s human resources development.
China also established Confucius Institute at University of Botswana (CIUB) in 2009, which so far attracted more than 6000 ordinary Botswana people to learn Chinese language and culture. In health area, China has been continuously sending medical teams to Botswana since 1981.
“To date, China has altogether sent 418 medical experts to Botswana and treated more than 3 million Botswana patients. China also launched 2 “Brightness Action” and helped hundreds of cataract patients to regain their sights. In wildlife protection area, China donated RMB10 million to support Botswana’s wildlife protection cause.”
“I have every confidence in the future growth of China-Botswana relations. Richly endowed in natural resources and committed to its strategy of economic diversity and industrialization, Botswana enjoys huge development potential. As for China, thanks to its rapid economic growth for more than three decades, it boasts comparative advantages in capital, technology, business and personnel. China and Botswana meet each other’s' demand, enjoy respective competitive edges and provide opportunities to each other. This means there is large potential for our cooperation.”
He said the forthcoming Johannesburg summit of FOCAC will provide a historical and precious opportunity for China and African countries including Botswana, to further strengthen mutually beneficial cooperation in the fields of economic, trade, infrastructure, culture, education, health, among others, thus bringing more tangible benefits to our peoples.
“I sincerely hope that our two countries could make concerted efforts to fully implement the new FOCAC action plans, promote a comprehensive upgrading of our friendly and mutually beneficial cooperation and push China-Botswana relationship to a higher level,” he stressed.
Currently, China is encountered with slowdown in economic growth and some people ask whether Africa can still count on China's development to bolster Africa's development. In Zheng words, “the Chinese economy is shifting from a high-speed growth to a medium-high growth of better quality, or “rebalancing”. This is not only because of the sluggish recovery of the world economy as a whole, but also a result of China's proactive management to promote structural reform, lower the speed of growth and improve the quality of growth.”
The Chinese Ambassador said they define this as the "new normal" of the Chinese economy. The Chinese economy registered a 7% growth in the first half of this year. Such performance is still one of the best among the world's major economies. The long-term prospects of the Chinese economy remain robust and sound, Zheng said.
China and Africa enjoy a profound and long-term friendship and are bound by this community of shared future and interests. In the 1960s and 1970s, the two sides forged profound friendship in the fight for national independence and liberation.
Zheng said nothing should stop the two sides from coming together to pursue common development. Africa is blessed with abundant natural and human resources and enjoys huge market and development potential.
The Agenda 2063 and its first Ten Year Plan adopted at this year's AU Summit have prioritized industrialization and sustainable development, ushering Africa into a new stage of development. As for China, with more than three decades of fast growth, it now has rich experience, mature technology, cost-effective equipment and sufficient capital in the field of industrialization.
“More importantly, China has the strong political will to support Africa in achieving economic independence and self-reliant sustainable development. China and Africa will usher in a new phase of win-win cooperation and common development,” said Zheng.
Statistics show that in 2014, trade between China and Africa exceeded US$220 billion and China's investment stock in Africa surpassed US$30 billion, an increase of 22 and 60 times respectively over the figures in 2000 when FOCAC was just established. Moreover, the share of China-Africa trade in Africa's total foreign trade has increased from 3.82% to 20.5%.
“What is particularly noteworthy is China's commitment to helping Africa break the two development bottlenecks of underdeveloped infrastructure and lack of human resources. The efforts have already made a big difference. By June 2015, over 3,800 kilometers of railways and 4,334 kilometers of roads have been either built or under construction in Africa with Chinese financing. More than 200 schools of various kinds have been established with Chinese assistance or financing. The Chinese government provides Africa with more than 7,000 government scholarships each year and holds over 100 multilateral and bilateral technical and management training programs and senior officials workshops for Africa each year,” said Zheng.
Some people criticize China’s involvement in Africa as similar to the colonial policy of the developed countries in the past. However Zheng said the criticism is absolutely not true.
He said in recent years, with the expansion of economic and trade cooperation between China and Africa, the hat of “New Colonialism” sometimes was added to China's head by some people, which is totally inconsistent with the facts and logic.
Zheng is of the view that the development of China-Africa relations over the years has proved that such assertions are completely nonsense. He said African countries will not accept such a point of view because China-Africa cooperation brings them practical benefits. He said History has proved that China developed equal and friendly relations with African countries and developed economic and trade relations with them in accordance with the international conventions and economic rules on the market.
“We purchase African resources at the international market price and through business negotiations. Due to the huge demand on the Chinese market, the prices of African resources on the international market have increased and African countries have reaped in more benefits. In comparison, how can we find any connection between China and colonialism? Therefore, the label of colonialism, new or old, will never stick on China.”
Botswana has made improvements on preventing and ending arbitrary deprivation of liberty, but significant challenges remain in further developing and implementing a legal framework, the UN Working Group on Arbitrary Detention said at the end of a visit recently.
Head of the delegation, Elina Steinerte, appreciated the transparency of Botswana for opening her doors to them. Having had full and unimpeded access and visited 19 places of deprivation of liberty and confidentiality interviewing over 100 persons deprived of their liberty.
She mentioned “We commend Botswana for its openness in inviting the Working Group to conduct this visit which is the first visit of the Working Group to the Southern African region in over a decade. This is a further extension of the commitment to uphold international human rights obligations undertaken by Botswana through its ratification of international human rights treaties.”
Another good act Botswana has been praised for is the remission of sentences. Steinerte echoed that the Prisons Act grants remission of one third of the sentence to anyone who has been imprisoned for more than one month unless the person has been sentenced to life imprisonment or detained at the President’s Pleasure or if the remission would result in the discharge of any prisoner before serving a term of imprisonment of one month.
On the other side; The Group received testimonies about the police using excessive force, including beatings, electrocution, and suffocation of suspects to extract confessions. Of which when the suspects raised the matter with the magistrates, medical examinations would be ordered but often not carried out and the consideration of cases would proceed.
“The Group recall that any such treatment may amount to torture and ill-treatment absolutely prohibited in international law and also lead to arbitrary detention. Judicial authorities must ensure that the Government has met its obligation of demonstrating that confessions were given without coercion, including through any direct or indirect physical or undue psychological pressure. Judges should consider inadmissible any statement obtained through torture or ill-treatment and should order prompt and effective investigations into such allegations,” said Steinerte.
One of the group’s main concern was the DIS held suspects for over 48 hours for interviews. Established under the Intelligence and Security Service Act, the Directorate of Intelligence and Security (DIS) has powers to arrest with or without a warrant.
The group said the “DIS usually requests individuals to come in for an interview and has no powers to detain anyone beyond 48 hours; any overnight detention would take place in regular police stations.”
The Group was able to visit the DIS facilities in Sebele and received numerous testimonies from persons who have been taken there for interviewing, making it evident that individuals can be detained in the facility even if the detention does not last more than few hours.
Moreover, while arrest without a warrant is permissible only when there is a reasonable suspicion of a crime being committed, the evidence received indicates that arrests without a warrant are a rule rather than an exception, in contravention to article 9 of the Covenant.
Even short periods of detention constitute deprivation of liberty when a person is not free to leave at will and in all those instances when safeguards against arbitrary detention are violated, also such short periods may amount to arbitrary deprivation of liberty.
The group also learned of instances when persons were taken to DIS for interviewing without being given the possibility to notify their next of kin and that while individuals are allowed to consult their lawyers prior to being interviewed, lawyers are not allowed to be present during the interviews.
The UN Working Group on Arbitrary Detention mentioned they will continue engaging in the constructive dialogue with the Government of Botswana over the following months while they determine their final conclusions in relation to the country visit.
Standard Chartered Bank Botswana (SCBB) has informed the government that it will not be accepting new loan applications for the Government Employees Motor Vehicle and Residential Property Advance Scheme (GEMVAS and LAMVAS) facility.
This emerges in a correspondence between Acting Permanent Secretary in the Ministry of Finance Boniface Mphetlhe and some government departments. In a letter he wrote recently to government departments informing them of the decision, Mphetlhe indicated that the Ministry received a request from the Bank to consider reviewing GEMVAS and LAMVAS agreement.
He said: “In summary SCBB requested the following; Government should consider reviewing GEMVAS and LAMVAS interest rate from prime plus 0.5% to prime plus 2%.” The Bank indicated that the review should be both for existing GEMVAS and LAMVAS clients and potential customers going forward.
Mphetlhe said the Bank informed the Ministry that the current GEMVAS and LAMVAS interest rate structure results into them making losses, “as the cost of loa disbursements is higher that their end collections.”
He said it also requested that the loan tenure for the residential property loans to be increased from 20 to 25 years and the loan tenure for new motor vehicles loans to be increased from 60 months to 72 months.
Mphetlhe indicated that the Bank’s request has been duly forwarded to the Directorate of Public Service Management for consideration, since GEMVAS and LAMVAS is a Condition of Service Scheme. He saidthe Bank did also inform the Ministry that if the matter is not resolved by the 6th June, 2022, they would cease receipt of new GEMVAS and LAMVAS loan applications.
“A follow up virtual meeting was held to discuss their resolution and SCB did confirm that they will not be accepting any new loans from GEMVAS and LAMVAS. The decision includes top-up advances,” said Mphetlhe. He advised civil servants to consider applying for loans from other banks.
In a letter addressed to the Ministry, SCBB Chief Executive Officer Mpho Masupe informed theministry that, “Reference is made to your letter dated 18th March 2022 wherein the Ministry had indicated that feedback to our proposal on the above subject is being sought.”
In thesame letter dated 10 May 2022, Masupe stated that the Bank was requesting for an update on the Ministry’s engagements with the relevant stakeholder (Directorate of Public Service Management) and provide an indicative timeline for conclusion.
He said the “SCBB informs the Ministry of its intention to cease issuance of new loans to applicants from 6th June 2022 in absence of any feedback on the matter and closure of the discussions between the two parties.” Previously, Masupe had also had requested the Ministry to consider a review of clause 3 of the agreement which speaks to the interest rate charged on the facilities.
Masupe indicated in the letter dated 21 December 2021 that although all the Banks in the market had signed a similar agreement, subject to amendments that each may have requested. “We would like to suggest that our review be considered individually as opposed to being an industry position as we are cognisant of the requirements of section 25 of the Competition Act of 2018 which discourages fixing of pricing set for consumers,” he said.
He added that,“In this way,clients would still have the opportunity to shop around for more favourable pricing and the other Banks, may if they wish to, similarly, individually approach your office for a review of their pricing to the extent that they deem suitable for their respective organisations.”
Masupe also stated that: “On the issue of our request for the revision of the Interest Rate, we kindly request for an increase from the current rate of prime plus 0.5% to prime plus 2%, with no other increases during the loan period.” The Bank CEO said the rationale for the request to review pricing is due to the current construct of the GEMVAS scheme which is currently structured in a way that is resulting in the Bank making a loss.
“The greater part of the GEMVAS portfolio is the mortgage boo which constitutes 40% of the Bank’s total mortgage portfolio,” said Masupe. He saidthe losses that the Bank is incurring are as a result of the legacy pricing of prime plus 0% as the 1995 agreement which a slight increase in the August 2018 agreement to prime plus 0.5%.
“With this pricing, the GEMVAS portfolio has not been profitable to the Bank, causing distress and impeding its ability to continue to support government employees to buy houses and cars. The portfolio is currently priced at 5.25%,” he said. Masupe said the performance of both the GEMVAS home loan and auto loan portfolios in terms of profitability have become unsustainable for the Bank.
Healso said, when the agreement was signed in August 2018, the prime lending rate was 6.75% which made the pricing in effect at the time sufficient from a profitable perspective. “It has since dropped by a total 1.5%. The funds that are loaned to customers are sourced at a high rate, which now leaves the Bank with marginal profits on the portfolio before factoring in other operational expenses associated with administration of the scheme and after sales care of the portfolio,” said the CEO.