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Botswana ranked 46th on illicit money flows


Botswana has ranked 46th out of 151 countries on the Global Financial Integrity (GFI) illicit financial outflow estimates.


Illicit financial flows (IFFs) are illegal movements of money or capital from one country to another. GFI classifies this movement as an illicit flow when the funds are illegally earned, transferred or utilized.


In 2012, illicit outflows were estimated at US$1,48 million (about N$17 million) according to a report issued this week by the GFI.


Botswana is ranked 46th with illegal flows at US$1,92 million. South Africa ranks in the top 10 with illicit outflows amounting to US$29 million while Namibia ranked 56th. Nigeria is ranked 17th with outflows amounting to US$7,9 million while Zambia is ranked 28th with outflows amounting to US$4,2 million.


Lesotho is ranked 76th with outflows US$506 000 while the Democratic Republic of the Congo is 98th with outflows amounting to US$148 000.


GFI said nearly US$1 trillion was illicitly drained from developing countries in 2012, representing a record level of corruption, money laundering and false trade documentation.


Illicit financial flows around the world grew at 9,4 percent a year in the decade to 2012, around double the pace of economic growth, draining funds especially from impoverished countries.


The largest outflows came from giant, still poorly-regulated economies like Brazil, China, India and Russia, GFI's new report says.


Money illicitly streamed out of China at a rate of about US$125 billion annually over that period, for instance.


But also in the top 10 country sources of illegal capital outflows are a number of dynamic middle-sized economies: Malaysia, Mexico, Saudi Arabia and Thailand.


Mexico is third on the list of largest outflows at an average US$54 billion a year.


In total, the report put the total illegal capital movements from developing and emerging economies in 2012 at US$991,2 billion, greater than the combined sum of incoming foreign investment and foreign aid in those countries.


“Emerging and developing countries haemorrhaged a trillion US dollars from their economies in 2012 that could have been invested in local businesses, healthcare, education, or infrastructure,” said the study's co-author, economist Joseph Spanjers.
“This is a trillion dollars that could have contributed to inclusive economic growth, legitimate private-sector job creation and sound public budgets.”


Over a decade, the total was US$6,6 trillion, the equivalent of nearly 4 percent of the entire global economy. In terms of the relative size of the impact, the countries hurt most by the flows were in the Middle East and North Africa and in Sub-Saharan Africa.


The main way the money flows out of the countries is mis-invoicing in trade transactions, which can allow exporters and imports to keep money out of the country.


GFI said individual countries and the United Nations need to focus on cutting down such flows to fight poverty and boost growth.


“It is simply impossible to achieve sustainable global development unless world leaders agree to address this issue head-on,” said GFI president Raymond Baker.


“That's why it is essential for the United Nations to include a specific target next year to halve all trade-related illicit flows by 2030 as part of post-2015 Sustainable Development Agenda.”

Some examples of illicit financial flows might include:

•A drug cartel using trade-based money laundering techniques to mix legal money from the sale of used cars with illegal money from drug sales;

 •An importer using trade mis-invoicing to evade customs duties, VAT, or income taxes;

 •A corrupt public official using an anonymous shell company to transfer dirty money to a bank account in the United States;

 •An human trafficker carrying a briefcase of cash across the border and depositing it in a foreign bank; or

•A terrorist wiring money from the Middle East to an operative in Europe.


 GFI estimates that in 2011, US$946.7 billion left developing countries in illicit financial outflows. This methodology is regarded as highly conservative, as it does not pick up movements of bulk cash, the mispricing of services, or many types of money laundering.


What be done about illicit financial flows
GFI believes that the most effective way to limit illicit financial flows is to increase financial transparency. Their conviction is that the GFI believes that we should enact policies to detect and deter cross-border tax evasion, to eliminate anonymous shell companies, to strengthen anti-money laundering laws and practices, to work to curtail trade mis-invoicing; and improve transparency of multinational corporations.

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Major public services shake-up looms

24th January 2022
Emmah

Public Servants should brace themselves for some changes as the government is in an overdrive mode to overhaul the public sector. The government has also set the tone for the looming changes as it has added the public sector to its looming list of major and sweeping reforms.

This is contained in a savingram from the Permanent Secretary to the President (PSP) Emmah Peloetletse’s office showing how the government intends to “take stock” of all reforms in the public sector through the establishment of an inventory.  Peloetletse’s savingram addressed to various ministries and the Directorate of Public Service Management (DPSM) reveals that the government is working around the clock to implement some changes in the Public Service.

The savingram reminded Permanent Secretaries of various ministries and DPSM that the public sector reforms unit (PSRU) at the Office of the President is mandated with Coordinating Reforms across the Public Service.  “This essentially entails providing the strategic guidance and facilitation in the implementation of reforms across the Public Service. In this endeavour the Unit has in the past with Technical Assistance from European Union developed a template for documenting Reforms in the Public Service and documented ten (10) major reforms across the Public Service,” reads the savingram in part. It added that “The Unit has lately rolled out the Change Management Framework in an effort to facilitate effective and efficient management of change in the Public Service.”

According to the savingram, it has been noted that for a variety of reasons the use of the template for documenting reforms has not been universally used across the Botswana Public Service.  It further states that to facilitate the documentation of the reforms it is essential that an inventory of the various reforms across the Public Service (Central Government, Local Government and State Owned Entities) is established.

“By this correspondent we are seeking your assistance in populating the attached template to provide basic information on the various reforms. The PSRU will, through the various Coordination of focal Persons facilitate the full documentation of the reforms once the inventory is established,” the savingram further stated. The copy of the template among others calls on the focal persons to fill out them form under several headings; they include title of reform, start date, reform objectives, reform components, reform components, progress status.

The savingram echoes President Mokgweetsi Masisi’s announcement last year during his state of the nation address that as a nation Botswana has set itself a lofty goal of becoming a high income country by 2036 and has come up with a list of reforms among them digitisation of government infrastructure. He said the path to achieving this goal dictates that, Botswana takes deliberate steps that will transform its institutions; the way Batswana think and the way they act.

“It is with this in mind, that I presented a Reset Agenda in May 2021, with the following priorities: Save Botswana‘s population from COVID-19, by implementing a series of life saving measures that include a successful and timely vaccination programme, Adherence to COVID-19 health protocols remains key and align Botswana Government’s machinery to the Presidential Agenda, to ensure that the national transformation agenda will be embodied in the public service of the day,” said Masisi. He added that, “this will come with significant Government reforms in all public institutions. We need greater agility and responsiveness like never before in the delivery of public services.”

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Covid-19 Task Force meddled in tenders-report

24th January 2022
Dr. Kereng Masupu

The Presidential COVID-19 Task Force reportedly meddled in the awarding of tenders for COVID-19, a new Public Accounts Committee (PAC) report has revealed.

The Committee expressed concern that it has noted that there are two centres for covid procurement being the Ministry of Health and the Covid Task team in the Office of the President. The report says the Committee questioned the Accounting Officer on why the COVID 19 task team is usurping the powers of the Ministry of Health by engaging in covid procurement when the Ministry of Health is the one which has the experience and mandate of dealing with the pandemic. The report says clarification was also sought on why direct appointment is the preferred method for covid procurement.

“In her response the Accounting Officer stated that the task team was mainly engaged in the procuring of quarantine facilities and was assisting the Ministry of Health due to the heavy workload brought about by the COVID 19 pandemic,” the report says. The report says the Accounting Officer further stated that direct procurement was used because COVID 19 was treated as an emergency and that procurement was mainly from companies that have been traditionally used by the Ministry of Health.

“This however, is not the case as there has been report of new companies being awarded COVID -19 contracts. The use of direct procurement method should only be used in exceptional cases as it’s a non-competitive method which increases the risk of inflated pricing and close relations with particular suppliers to the detriment of others,” the report says.

It says since most covid procurement fell under emergency, there is need for openness and transparency regarding the procurement.  The PAC recommended that in order to ensure transparency and accountability all COVID 19 related procurement should be periodically published in the PPADB website giving full details of the companies receiving procurement contracts and the beneficial owners of the companies.

It says with the passage of time the impact of covid is no longer unexpected so direct awards should gradually be abandoned as the medium and long-term needs of the pandemic can now be predicted. “Judgement should be used even during direct awards to ensure that prices are not higher than the market prices,” the report says.

In a related matter, the report says the Central Medical Stores (CMS) was unable to cater for the required quantities of medical supplies with order fulfilments of about 35% resulting in shortages and insufficient drugs to Athlone Hospital and the surrounding clinics.
“In his submission the Accounting Officer had indicated that CMS was unable to supply the exact quantities required by the hospital and surrounding clinics due to the fact that supplies from CMS have to be rationed in order to cover other facilities around the country,” says the report.

The committee expressed concern about the inadequate supply of drugs to government facilities which puts the lives of patients at risk due to non- availability of essential supplies. It recommended that the Ministry identifies and prioritise measures that need to be taken to ensure that there is adequate supply of essential medicines which are needed in the public health system.

Meanwhile the report says the Ministry of Health and Wellness coordinates the operations and functions of some institutions which receive government subventions and secondment of staff from the government. These institutions include 10 NGO’s, two mission Hospitals, three mission clinics and two schools of Nursing.

It says in its endeavour to enhance efficiency and effectiveness of government support to NGOs the Ministry of Finance and Economic Development developed some Policy Guidelines for Financial Support to Non- Governmental Organisations.  According to the PAC report, the guidelines were meant to ensure that there is consistency, accountability and transparency in administering public funding to NGOs. However, the Ministry of Health did not comply with the very important guidelines.

“The main areas of non-compliance were the following: (i) There was no Evaluation Committee to vet proposals from NGOs, in some instances NGOs had formed part of the evaluation forum when their requests were being considered,” the report says.  It says there was continued funding of NGOs even when they failed to submit narrative and financial progress reports; and (iv) Continued funding of NGOs that failed to submit audited financial statements and management letters as required. The Committee expressed concern at the lapses in the administration of grants by the Ministry despite the large sums of public money awarded to these NGOs.

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BDF killings of Namibians: Court unable to rule on missing gun

24th January 2022
BDF

The Kasane Regional Magistrate Court refused this week to rule on whether three Namibians and their Zambian cousin shot dead by members of the Botswana Defence Force (BDF) were in possession of a rifle or not prior to their deaths.

Ruling in favour of the BDF members, Regional Magistrate Taboka Mopipi who presided over the inquest said, “It is acknowledged that no rifle has been produced before court to confirm that indeed the deceased were armed and or that there was indeed a gun shot.”  She said the evidence before the court is that search for the rifle(s) that allegedly triggered the gunfire exchange was done by both Namibia and Botswana SCUBA divers and nothing was found. She said when the said search was done, an area of search was demarcated around the scene area which was partly searched due to water animals such as hippos that launched an attack at the area during the search.

“The search was therefore never concluded. This therefore leaves a gap. To that end, the area not extensively searched, the court cannot make a finding whether the rifle in issue was there or not. This is a very crucial piece of evidence,” added Mopipi. She said the joint search did not conclude the exercise and I cannot properly make a finding of fact adding that that the rifle was there as the BDF allege can therefore not be ruled out.

The deceased are Martin Munilweye Nchindo, Ernest Nchindo, Tommy Sinvula Nchindo and Sivula Munyeme. The four deceased persons died on the night of the 5th November 2020, in the waters of the Chobe River (Southern Channel) near Sedudu/Kasikili Island in Botswana. Mopipi said the incident took place at night, in a gloomy atmosphere and that as at the time, movement in that particular area was restricted and or not permitted.

She said it was the evidence of some of the witnesses that the injuries as observed on the four deceased reflected that they were brutally assaulted and or beaten either before or after being shot. “Their evidence gained support from Witness 34, Dr. Bithoma Thotho Amis who observed post mortem on behalf of the families of the deceased and Government of Namibia. This witness however conceded during cross-examination that the injuries as observed have been caused by other contacts and or impacts such as falling and hitting the hard surface of a wooden canoe,” said Mopipi.

She emphasized that inquest proceedings have very serious consequences and therefore, whatever evidence brought before court must be produced by persons of right qualifications particularly the post mortem report which the court has to rely upon.
“The qualification of the expert is crucial in determining the credibility of the report. Upon assessment of both experts, I am inclined to adopt the reports from Witness 18, who is a qualified pathologist. A closer look at the other report indicates that the author, Witness 34 is not a qualified pathologist and it is meddled by issues outside an expert opinion,” she said.

Mopipi said reports compiled by a consultant Forensic Pathologist Dr. Kaone Panzirah-Mabaka show the causes of death as follows; Sivula Munyeme, gunshot injury to the chest and extremities, Martin Nchindo, gunshot wound to the abdomen and pelvis, Ernest Nchindo, multiple gunshot injuries to the chest and extremities and Tommy Nchindo, gunshot wound to the chest and abdomen.

“Medical evidence therefore prove conclusively that the four deceased persons died due to gunshots injuries. It is undisputed that the injuries were inflicted by seven (7) members of the Botswana Defence Force; Lieutenant Moreri Kenneth Mphela, Sergeant Ndingisano Nfazo, Sergeant Puisano Pistor Kgokong, Private Mbikiso Tafila, Private Emmanuel Moganetsi Majuta, Private Barulaganyi Rannosang and Private Oromilwe Motlhabi,” said Mopipi.

Mopipi found that there was a gunshot from the direction of the men to the direction of the BDF section.  “The BDF members retaliated and returned fire. This was done in accordance with Standard Operation Procedures (SOPs) within the BDF. According to the SOPs, in case a soldier is being fired at, they fire back and do not have to wait for a command,” she said. She added that “The gunfire exchange was brief and after it ceased, they used a torch to light where the men were and established that all the four men were motionless, two in one canoe, one in the other and the other man lying on the edge of the river on the Island.”

She said, “The evidence of the witnesses is that, when they followed the intel, the intent was to conduct an investigation. There was clearly no intent on their part to shoot the deceased, they did that as an act of retaliation.”

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