Gov’t policy not informed by research – Industry leaders
Government has come under the spotlight for formulating policies which are not based on research, and for sidelining institutions which could contribute positively to sound policy formulation, a Human Resources Development Council (HRDC) sector committees’ workshop held this week has revealed.
Dr Comfort Mokgothu, Chairperson of Transport and Logistics sector committee highlighted these concerns when responding to workshop participants on why it takes long for the country to adopt and utilise available opportunities to advance the economy.
Dr Mokgothu contended that while Botswana may have progressed significantly with regards to well trained human resources, academics still have no place in formulation of policies, because government policies are not always informed by research.
He was responding to one of the workshop participants who wanted to establish, why academics are not coming to the party as far as finding solutions for the country’s economic prosperity is concerned.
The same concerns were raised by Dr Howard Sigwele who noted that Agriculture has been neglected and its contribution to the Gross Domestic Product (GDP) relegated to an insignificant amount.
“For the 50 years, agriculture has been fewer contributors to the GDP because we do not do commercial farming and most of our farmers do it part time,” he observed and added that, “yet, we know that, agriculture was the important economic activity in the past to an extent that cattle farming financed our studies.”
Botswana is heavily reliant on South Africa for agricultural produce and the country is unable to produce enough to meet the country’s demand.
Government has been increasingly accused of ignoring experts and pursuing policies which are unsustainable.
In the 2016/17 budget speech, Ministry of Agriculture was one of the ministries which received smaller share of the budget. Ministry of Agriculture received the second least share with a recurrent budget of P1.09 billion.
One such institution which has been left in the lurch is Botswana Institute for Development Policy Analysis (BIDPA). Formed in the 1990s by then President Quett Masire for the purpose of among others, monitoring the performance of the Botswana economy, BIDPA has become less influential in government policy formulation.
BIDPA also has the mandate to manage public policy implementation, especially with regard to the implications for economic and social development.
Government has in recent years viewed BIDPA as one of the institutions which are vehemently critical to government policies.
The Target 20 000 programme recently announced by government has also come under heavy criticism and highlighted as an example of government’s sidelining of relevant institutions.
Barely two years ago, government transformed the Tertiary Education Council (TEC) into the Human Resource Development Council (HRDC) with a new mandate of being government chief advisor on matters involving the country’s human resource.
Weekend Post has been reliably informed that the jumbled up Target 20 000 Up-skilling and Up-scaling programme is a brainchild of Ministry of Education and Skills Development and was not recommended by the HRDC. The programme disregards among other recommendation that government should be training more students in technical education.
A report, titled ‘Tertiary at Glance’ published by Human Resource Development Council (HRDC) recently indicated government was not giving technical education the attention it deserves as evidenced by low enrolment.
“This means that Technician level training in Botswana has a very low share of tertiary enrolments. Given that a growing economy needs all kinds of technicians in the critical skill areas like Electrical/Electronics, Construction/Building, computer engineering, Instrumentation and mechanical engineering this trend is worrying,” reads the report in part.
“The technical colleges seem to have good infrastructure that is comparable to others. So this trend shows us anecdotally that there may well be low utilisation of existing resources in the technical Colleges.”
The Directorate on Corruption and Economic Crime (DCEC) has also raised concern in the past regarding enactment of laws and policies which will help curb crime. DCEC has admitted that lack of proper legal framework aimed at curbing corruption was hindering progress in fighting corruption.
DCEC has since recommended to cabinet the need to introduce Declaration of Assets and Liabilities.
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Batswana owe banks P79 billion
The Minister of Finance, Peggy Serame, has disclosed that the total bank credit extended by commercial banks amounted to P79 billion, out of which P53.4 billion was retail loans and advances to households.
Parliament was informed this week in response to a question by the Member of Parliament for Selibe-Phikwe West and Leader of Opposition (LOO), Dithapelo Keorapetse.
â€śAs at 31st December 2022, loans and other advances extended to households by banks constituted the largest share of bank-lending at 67.6 percent, the majority of which was unsecured personal loans at P36.2 billion (67.8%),â€ť said Serame.
She added that the total household Debt to GDP ratio was 21.9%, while the total private business credit to Gross Domestic Product (GDP) ratio was 10.8%.
On the other hand, it was noted that outstanding mortgage loans extended to households were P14.2 billion (26.6% of household debt) or 5.9% of GDP. Overall, total bank credit as a ratio of GDP stood at 32.7 percent.
It was acknowledged that there are 10 deposit-taking banks in the country, that is, nine commercial banks and one statutory bank (Botswana Savings Bank). This statistics excludes the National Development Bank (NDB), which is a development finance institution. The nine commercial banks include an indigenous bank, Botswana Building Society Bank Limited (BBSBL), which was issued with a commercial banking license by the Bank of Botswana in October 2022.
Still in December 2022, it was recorded that there were 376 non-bank lenders in Botswana consisting of 246 micro lenders, 66 finance companies, three leasing companies and 61 registered pawnshops.
According to Minister Serame, the loan book value representing the principal amount lent by these entities to individuals and to small, medium and micro Enterprises (SMMEs) is collated by the Non-Bank Financial Institutions Regulatory Authority (NBFIRA), which at 31stÂ of December 2021, the loan book values were P5.6 billion for micro lenders, P1.6 billion for finance companies, P225 million for leasing companies and P14 million for pawnshops.
Government policy is that price control is not effective or desirable, and, as such, interest rates are not regulated. Non-regulation may, among other things, result in an increase in non-interest rate fees and commissions, reduced price transparency, lower credit supply and loan approval rates.
â€śIt is important to note that, from a macroeconomic perspective, household debt in Botswana is neither a pandemic nor considered to be excessive. Indeed, the Bank of Botswanaâ€™s periodic and continuous assessments of household debt, including through the annual Household Indebtedness Surveys, suggest moderate household indebtedness and therefore, is of no apparent risk to the safety and soundness of the domestic financial system,â€ť said Serame.
She also alluded this assessment is validated by the recently concluded Financial Sector Assessment Programme (FSAP) on Botswana undertaken by the International Monetary Fund and the World Bank Group.
Keorapetse however rebuked the issue of debt not being excessive and noted the Minister thinks itâ€™s fine for Batswana to be debt burdened in a way that their debts diminishes their quality of life.
â€śA significant portion of Batswanaâ€™s salaries go to servicing debts and because she doesnâ€™t see this as a challenge, there can never be any intervention from her side.Â There is no price regulation on interest, which can go up to 30%+ a month.Â Â Since President Masisi ascended to the high office in 2018, 2 384 Batswana were put in prison for failure to pay debts, that is 467 Batswana every year. So, for us, debt problems are big and concerning,â€ť said Keorapetse.
He said they are worried because Batswana are drowning in debts because of relative poverty, slave wages and unemployment/underemployment, they buy basic needs and services with borrowed money and noted predatory and unethical lending has become a major problem in Botswanaâ€™s financial sector.
How to fleece P14 million from Chinese investor
The modus operandi of how five men allegedly swindled a Chinese national P14 million last week continue to unravel. Highly placed sources from the intelligence, the Directorate on Corruption and Economic Crime (DCEC) and Botswana Unified Revenue Services (BURS) revealed to this publication how the whole scam was concocted.
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ENVIRONMENT ISSUES: Masisi asks Virginia for help
President Mokgweetsi Masisi says the issue of sustainable natural resources management has always been an important part of Botswanaâ€™s national development agenda.
Masisi was speaking this week on the occasion of a public lecture at Virginia Polytechnic, under theme, â€śMerging Conservation, Democracy and Sustainable Development in Botswana.â€ť
Botswana, according to Masisi, holds the view that the environment is fragile and as such, must be managed and given the utmost protection to enable the achievement of Sustainable Development Goals (SDGs).
â€śIt is necessary that we engage one another in the interchange of ideas, perspectives, visualizations of social futures, and considerations of possible strategies and courses of action for sustainable development,â€ť said Masisi.
On the other hand, dialogue, in the form of rigorous democratic discourse among stakeholders presents another basis for reconfiguring how people act on their environments, with a view to conserving its resources that â€śwe require to meet our socio-economic development needs on a sustainable basis,â€ť Masisi told attendees at the public lecture.
He said government has a keen interest in understanding the epidemiology and ecology of diseases of both domestic and wild animals. â€śIt is our national interest to forestall the dire consequences of animal diseases on our communities livelihoods.â€ť
President Masisi hoped that both Botswana and Virginia could help each other in curbing contagious diseases of wildlife.
â€śWe believe that Virginia Tech can reasonably share their experiences, research insights and advances in veterinary sciences and medicines, to help us build capacity for knowledge creation and improve efforts of managing and containing contagious diseases of wildlife. The ground is fertile for entering into such a mutually beneficial partnership.â€ť
When explaining environmental issues further, Masisi said efforts of conservation and sustainable development might at times be hampered by the emergence and recurrence of diseases when pathogens mutate and take host of more than one species.
â€śWater pollution also kills aquatic life, such as fish, which is one of humanityâ€™s much deserved sources of food. In this regard, One Health Approach imposes ecological responsibility upon all of us to care for the environment and the bio-diversity therein.â€ť
He said the production and use of animal vaccines is an important space and tool for conservation, particularly to deal with trans-border animal diseases.
â€śIn Botswana, our 43-year-old national premier pharmaceutical institution called Botswana Vaccine Institute has played its role well. Through its successful production of highly efficacious Foot and Mouth vaccines, the country is able to contain this disease as well as supply vaccines to other countries in the sub-region.:
He has however declared that there is need for more help, saying â€śWe need more capacitation to deal with and contain other types of microbial that affect both animals and human health.â€ť