Job creation: Masisi pledges budget, political will
Business
Botswana’s government is committed to creating jobs particularly through the private sector, Vice president Mokgweetsi Masisi told the participants of the first annual Job Summit, adding that if sufficient jobs are not created, the blame should lay with the private sector.
“The private sector should be able to create decent jobs, we have enabled a conducive environment for that.” At the same time, Masisi, who also is mandated with job creation strategies, said that the government does not intend on creating jobs in the government, instead the private sector should create more jobs.
He acknowledged that there are still challenges such as overcoming bureaucracy but the government is committed to removing barriers that hinder the participation of the private sector.
The vice president called on the private sector to be more innovative in their approach instead of franchising existing businesses.
“Franchising leads to dependency syndrome,” he warned, asserting that job creation is made even more possible by home grown businesses that could train their employees. He reasoned that “skilled manpower creates jobs.” He decried that the youth are mostly affected by unemployment, and if the situation continues, the rate of unemployment will keep on increasing.
Masisi also shed light on the intended objectives of the envisaged Economic Stimulus Package. He said that the package will have impact everywhere, “Nobody will be left out” he emphasised. Furthermore, the success of the stimulus package will be measured on the number of jobs created in each sector as well as the number of new businesses created per sector. So far the identified sectors are construction, tourism development, manufacturing and agriculture.
The upbeat message from the vice president did not cease other panellists from assessing the country’s challenges and prospects. Bogolo Kenewendo, an economist with the Ministry of Trade in Ghana, pointed to the slow economic growth as a hindrance to job creation.
Kenewendo advised the government to shift from being an export dependent economy to a non-export economy. She also took issue with the lack of comprehensive data, especially that of labour market force, before dropping a bombshell that Botswana’s unemployment rate could be hovering around 40%, “using the narrow definition of unemployment.”
The official unemployment rate is somewhere around 20%. On the supply side of things, Kenewendo had this to say, “Is there a mismatch? Are our people skilled or educated?” This comes against the backdrop of employers complaining about the competence of some job seekers.
Dr Joel Sentsho, Trade Policy Advisor in the Ministry of Trade and Industry, said that job creation will flourish in a diversified economy. While admitting that Botswana’s economy is not diversified, he was upbeat about future prospects.
“Institutions are drivers of Botswana’s industrial development agenda,” Sentsho said, explaining that development of high priority and high impact sectors were key to job creation.
Moreover, he added that the Ministry of Trade and Industry is committed to ensuring that the industrial development policy, trade policy and special economic zones are a success that will result in job creation. He cited the proposed leather park in Lobatse as an example of economic diversification and job creation, “When completed, the project will create more than a thousand jobs.”
Dr Sentsho implored the government not to throw money at unemployment but rather come up with strategies to create jobs, “Industrial development, economic diversification and job creation require a combination of both the brain and resources,” he advised.
Professor Brothers Malema, an associate professor of Economics at the University of Botswana, confirmed that Botswana’s economy has been experiencing jobless growth.
“The economy is growing but the job creation is minimal,” he said. Malema attributed this to nature of the capital intensive production of mining which drives the economy, adding that labour suffers as a result.
“Capital intensity of mining is well documented, prospects for jobless growth will continue unabated,” he emphasised. To effectively deal with the increasing unemployment rate, we need to deal with underlying problems, he argued.
“Botswana was one of the fastest growing economies but house income disparity has been rapidly increasing over the years.” He said given the growing income inequality, he wonders if allocative efficiency is in the best interest of society or just a few.
The panellists called for accountable and transparent government institutions, greater collaboration between private sector and government in job creation as well as increased productivity in the private sector and civil service. Other key recommendations were tackling corruption, better project management and sound investments with tangible returns, improving the ease of doing business in Botswana.
Business
Stargems Group establishes Training Center in BW
Internationally-acclaimed diamond manufacturing company StarGems Group has established the Stargems Diamond Training Center which will be providing specialized training in diamond manufacturing and evaluation.
The Stargems Diamond Training Institute is located at the Stargems Group Botswana Unit in Gaborone.
“In accordance with the National Human Resource Development Strategy (NHRDS) which holds the principle that through education and skills development as well as the strategic alignment between national ambitions and individual capabilities, Botswana will become a prosperous, productive and innovative nation due to the quality and efficacy of its citizenry. The Training Centre will provide a range of modules in theory and in practice; from rough diamond evaluation to diamond grading and polishing for Batswana, at no cost for eight weeks. The internationally- recognized certificate offered in partnership with Harry Oppenheimer Diamond Training School presents invaluable opportunities for Batswana to access in the diamond industry locally and internationally. The initiative is an extension of our Corporate Social Investment to the community in which we operate,” said Vishal Shah, Stargems Group Managing Director, during the launch of the Stargems Diamond Training Center.
In order to participate in this rare opportunity, interested candidates are invited to submit a police clearance certificate and a BGCSE certificate only to the Stargems offices. Students who excel in these programs will have the chance to be onboarded by the Stargems Group. This serves as motivation for them to go through this training with a high level of seriousness.
“Community empowerment is one of our CSR principles. We believe that businesses can only thrive when their communities are well taken of. We are hoping that our presence will be impactful to various communities and economies. In the six countries that we are operating in, we have contributed through dedicating 10% of our revenues during COVID-19 to facilitate education, donating to hospitals and also to NGOs committed to supporting women and children living with HIV. One key issue that we are targeting in Botswana is the rate of unemployment amongst the youth. We are looking forward to working closely with the government and other relevant authorities to curb unemployment,” said Shah.
Currently, Stargems Group has employed 117 Batswana and they are looking forward to growing the numbers to 500 as the company grows. Majority of the employees will be graduates from the Stargems Diamond Training Center. This initiation has been received with open arms by the general public and stakeholders. During the launch, the Minister of Minerals and Energy, Honorable Lefoko Moagi, stated that the ministry fully endorses Stargems Diamond Training and will work closely with the Group to support and grow the initiative.
“As a ministry, we see this as an game changer that is aligned with one of the United Nations’ Six Priority Sustainable Development Goals, which is to Advance Opportunity and Impact for Diversity, Equity, and Inclusion (DEI). What Stargems Group is launching today will have a huge impact on the creation of employment in Botswana. An economy’s productivity rises as the number of educated workers increases as its skilled workmanship increases. It is not a secret that low skills perpetuate poverty and widen the inequality gap, therefore the development of skills has the potential to contribute significantly to structural transformation and economic growth by enhancing employability and helping the country become more competitive. We are grateful to see the emergence of industry players such as Stargems Group who have strived to create such opportunities that mitigate the negative effects of COVID-19 on the economy,” said the Minister of Minerals and Energy.
Business
Food import bill slightly declines
The latest figures released by Statistics Botswana this week shows that food import bill for Botswana slightly declined from around P1.1 billion in November 2022 to around P981 million in December during the same year.
This content is locked
Login To Unlock The Content!
Business
Moody’s Reaffirms African Trade Insurance’s A3 Rating & Revises Outlook to Positive
Moody’s Investors Service (“Moody’s”) has affirmed the A3 insurance financial strength rating (IFSR) of the African Trade Insurance Agency (ATI) for the fifth consecutive year and changed the outlook from stable to positive.
Moody’s noted that the change in outlook to positive reflects the strong growth in ATI’s membership base – that has resulted in improved portfolio diversification, strengthened capital adequacy, and the good profitability despite the challenging operating environment. In addition, ATI benefits from its preferred creditor status (PCS) amongst sovereign member states which protects it from the risk of default by member sovereigns through securing recoveries against claims paid on guarantees.
The strong membership and equity growth are some of the key considerations for the consistent reinstatement of ATI’s A/Stable rating by Standard & Poor’s and Moody’s rating, over the years. Also supporting the rating affirmation are; consistent improvement in financial performance, commitment of its shareholders who continue to uphold the preferred creditor status, its high quality and conservative investment portfolio as well as strong relationships with a number of global reinsurers that provide significant risk-bearing capacity.
With the change in outlook to “positive”, ATI is now better placed to provide enhanced support to its member countries, attract additional shareholding and grow its portfolio. The positive outlook is an indication that if ATI continues to demonstrate its strong underwriting performance and ability to recover claims under the preferred creditor arrangements, among other factors, an upward pressure towards an upgrade may be generated. The Moody’s press release can be accessed from here
Commenting on the rating, Africa Trade Insurance Chief Executive Officer Manuel Moses said: “This positive revision is in line with our 2023 – 2027 strategic objectives in which we set to improve our rating outlook to positive in the first year, and achieve an upgrade of at least “AA”/Stable rating by both Moody’s and S&P within this Strategic Plan period. We aim to achieve this by doubling our exposures and increasing our capital to more than USD1 billion.”
ATI’s mandate is to provide trade-credit and political risk insurance, as well as other risk mitigation products to its member countries and related public and private sector actors. These insurance products not only directly encourage and facilitate foreign direct investment as well as local private sector investment in our member countries, but also contribute to intra- and extra-African trade.
About The African Trade Insurance Agency
ATI was founded in 2001 by African States to cover trade and investment risks of companies doing business in Africa. ATI predominantly provides Political Risk, Credit Insurance and, Surety Insurance. Since inception, ATI has supported US$78 billion worth of investments and trade into Africa. For over a decade, ATI has maintained an ‘A/Stable’ rating for Financial Strength and Counterparty Credit by Standard & Poor’s, and in 2019, ATI obtained an A3/Stable rating from Moody’s, which has now been revised to A3/Positive.