Banks offer BoB a knife to cut rates in April
Banks are now offering Bank of Botswana (BoB) a knife to slice down interest rates during the end of April Monetary Policy Committee meeting, this comes in the wake of the COVID-19 outbreak which brought lower growth in the global economic activity, hence presenting downside risks to the outlook and bringing anxiety to the local economy.
The upcoming BoB Monetary Policy Committee (MPC) meeting on 30 April 2020 will not come without discussion of the now notorious global pandemic coronavirus-but the main anticipated action is for the central bank to shed the interest rate in an effort to cushion financial stability and maintaining a sound economic environment.
The last time BoB cut the interest rate was in last year’s August MPC meeting, when it was cut by 25 basis points from 5 percent to 4.75 percent. After observing an inflation which remained weak given subdued demand pressures in the economy, Governor Moses Pelaelo took a knife of monetary ruling and sliced the rate by a quarter percentage point to 4.75 percent. That time inflation rate increased from 2.8 percent in June to 2.9 in July and Pelaelo stated that the inflation was still low albeit closer to the lower bound of the Bank’s objective range of 3 to 6 percent.
An interest rate is a benchmark rate used by banks and other financial institutions as a guide to what they pay savers or charge some borrowers. It could happen that a sudden cut in the Bank rate will immediately reduce the mortgage bill of a minority of homeowners. Reduction of Bank rate may allow banks to freely lend money to households and businesses, hence protection of an economy.
After feeling the COVID-19 economic affliction, the central bank of the most influential and the benchmark world economy, the US, Federal Reserve System (The Fed), got fed up and reduced its target interest rate near zero or by 1.00 percent to a range of 0-0.25 percent.
According to experts central bankers in five key sub-Saharan African countries will meet on interest rates in the next ten days as the focus turns to them for measures to shore up their economies that are expected to be hit by the novel coronavirus. Recently business media outlet Bloomberg has made a survey from 21 economists, from the figure 11 predict a cut of 50 basis points while 10 expect a reduction of 25 basis points.
One of the leading financial institutes First National Bank Botswana (FNBB) Chief Economist Moatlhodi Sebabole said in an interview with BusinessPost that the bank anticipates that there will be cumulative rate cut of around 75basis points in the second half of 2020 (2h20). He noted that the plausible timing of the cuts should start by 50 basis points which could be by the next Monetary Policy Meeting in April.
“At FNBB, we expect the rate cut to come as early as April due to: Anticipated lower domestic growth environment and downward pressures on the already low inflation projection (oil prices now at multi-decade lows) alongside heightened global risk factors. We expect rate cuts because inflation will remain low and below the central bank’s lower inflation objective of 3.00 percent through to 2h20 – as consumer demand remains muted; and supply side pressures remain subdued with lower oil price outlook,” said Sebabole.
Sebabole who is also Chairperson of government’s National Transformation Strategy Team added that FNBB want the rate to be slashed because of the disruption in the supply value chain which will mostly impact foreign earnings on tourism and mining – as well as impacting manufacturing, construction, logistics sectors. He said the factors mentioned will negatively impact business and consumer confidence; as well as consumption and investment levels. The FNBB chief economist, when explaining the need for a rate, said a wider budget deficit is anticipated as healthcare budget will have to be augmented to deal with testing; preventive; protective and treatment (should a covid-19 case be reported in Botswana) of the virus and potentially some fiscal packages to support a fragile economy.
“The US FED has cut rates to close to 0.00 percent (150bp cut in 1Q20 alone); while for South Africa it is anticipated to go by over 50bp in the next few months. These creates more space for Bank of Botswana to cut rates without substantially reducing Botswana’s interest rate gap with its major trading partners. This is in line with group view for SARB (cuts expected in 1H20 to support ailing economy and rising yields); FED has been bold and reduced the rates to 0.00 percent- 0.25 percent already,” Sebabole told BusinessPost.
Sebabole said from April there should be another shed of interest rates in the 18 June 2020 meeting by 25 percent, while maintaining the rate at 4.00 percent to the second half of 2020. Another leading bank, Absa Botswana expects the bank rate to be cut as soon as next month’s MPC meeting. In an interview with BusinessPost this week, Absa Botswana economist Naledi Madala said the central bank is likely to cut the bank rate by 50basis points in April to support domestic economic activity.
“We believe that headline inflation will likely rise hereon as favourable base effects in transport inflation fade. Though inflation is expected to move higher, it would be increasing from record low levels and is expected to remain within the target band. We forecast a year-end inflation rate of 3.4 percent year on year. This gives the MPC room to stimulate the economy,” said Madala.
Madala said with the Covid-19 outbreak spreading across the global economy and working its way through to the real economy via weakening sentiment, supply-chain disruptions and financial market turmoil, headwinds to growth are picking up. As a small and open country that depends heavily on volatile export segments, Botswana is vulnerable to swings in global economic growth and commodity prices, said Madala.
Former Deputy Governor of BoB Keith Jeffries said the central bank might take a decision to cut interest rates, but is sceptical of the move as an effective policy intervention. Jeffries said monetary policy easing is unlikely to be very effecting, government should rather focus on fiscal expenditure based measures to offset the impact and in particular at how to relieve the pressure on businesses experiencing cash-flow stress.
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19 Bokamoso Private Hospital nurses graduate at Lenmed Nursing College
The graduation of 19 nurses from Bokamoso Private Hospital at Lenmed Nursing College marks a significant milestone in their careers. These nurses have successfully completed various short learning programs, including Adult Intensive Care Unit, Emergency Nursing Care, Anaesthetic & Recovery Room Nursing, Anaesthetic Nursing, and Recovery Room Nursing. The ceremony, held in Gaborone, was a testament to their hard work and dedication.
Lenmed Nursing College, a renowned healthcare group with a presence in South Africa, Botswana, Mozambique, and Ghana, has been instrumental in providing quality education and training to healthcare professionals. The Group Head of Operations, Jayesh Parshotam, emphasized the importance of upskilling nurses, who are at the forefront of healthcare systems. He also expressed his appreciation for the partnerships with Bokamoso Private Hospital, the Ministry of Health, and various health training institutes in Botswana.
Dr. Morrison Sinvula, a consultant from the Ministry of Health, commended Lenmed Health and Lenmed Nursing College for their commitment to the education and training of these exceptional nurses. He acknowledged their guidance, mentorship, and support in shaping the nurses’ careers and ensuring their success. Dr. Sinvula also reminded the graduates that education does not end here, as the field of healthcare is constantly evolving. He encouraged them to remain committed to lifelong learning and professional development, embracing new technologies and staying updated with the latest medical advancements.
Dr. Gontle Moleele, the Superintendent of Bokamoso Private Hospital, expressed her excitement and pride in the graduating class of 2023. She acknowledged the sacrifices made by these individuals, who have families and responsibilities, to ensure their graduation. Dr. Moleele also thanked Lenmed Nursing College for providing this opportunity to the hospital’s nurses, as it will contribute to the growth of the hospital.
The certificate recipients from Bokamoso Private Hospital were recognized for their outstanding achievements in their respective programs. Those who received the Cum Laude distinction in the Adult Intensive Care Unit program were Elton Keatlholwetse, Lebogang Kgokgonyane, Galaletsang Melamu, Pinkie Mokgosi, Ofentse Seboletswe, Gorata Basupi, Bareng Mosala, and Justice Senyarelo. In the Emergency Nursing Care program, Atlanang Moilwa, Bakwena Moilwa, Nathan Nhiwathiwa, Mogakolodi Lesarwe, Modisaotsile Thomas, and Lorato Matenje received the Cum Laude distinction. Kelebogile Dubula and Gaolatlhe Sentshwaraganye achieved Cum Laude in the Anaesthetic & Recovery Room Nursing program, while Keletso Basele excelled in the Anaesthetic Nursing program. Mompoloki Mokwaledi received recognition for completing the Recovery Room Nursing program.
In conclusion, the graduation of these 19 nurses from Bokamoso Private Hospital at Lenmed Nursing College is a testament to their dedication and commitment to their profession. They have successfully completed various short learning programs, equipping them with the necessary skills and knowledge to excel in their respective fields. The collaboration between Lenmed Nursing College, Bokamoso Private Hospital, and the Ministry of Health has played a crucial role in their success. As they embark on their careers, these nurses are encouraged to continue their professional development and embrace new advancements in healthcare.
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BNF secures 15 constituencies in UDC coalition, wants more
The Botswana National Front (BNF) has recently announced that they have already secured 15 constituencies in the Umbrella for Democratic Change (UDC) coalition, despite ongoing negotiations. This revelation comes as the BNF expresses its dissatisfaction with the current government and its leadership.
The UDC, which is comprised of the BNF, Botswana Peoples Party (BPP), Alliance for Progressives (AP), and Botswana Patriotic Front (BPF), is preparing for the upcoming General Elections. However, the negotiations to allocate constituencies among the involved parties are still underway. Despite this, the BNF Chairman, Patrick Molotsi, confidently stated that they have already acquired 15 constituencies and are expecting to add more to their tally.
Molotsi’s statement reflects the BNF’s long-standing presence in many constituencies across Botswana. With a strong foothold in these areas, it is only natural for the BNF to seek an increase in the number of constituencies they represent. This move not only strengthens their position within the UDC coalition but also demonstrates their commitment to serving the interests of the people.
In a press conference, BNF Secretary General, Ketlhafile Motshegwa, expressed his discontent with the current government leadership. He criticized the ruling Botswana Democratic Party (BDP) for what he perceives as a disregard for the well-being of the Batswana people. Motshegwa highlighted issues such as high unemployment rates and shortages of essential medicines as evidence of the government’s failure to address the needs of its citizens.
The BNF’s dissatisfaction with the current government is a reflection of the growing discontent among the population. The Batswana people are increasingly frustrated with the lack of progress and the failure to address pressing issues. The BNF’s assertion that the government is playing with the lives of its citizens resonates with many who feel neglected and unheard.
The BNF’s acquisition of 15 constituencies, even before the negotiations have concluded, is a testament to their popularity and support among the people. It is a clear indication that the Batswana people are ready for change and are looking to the BNF to provide the leadership they desire.
As the negotiations continue, it is crucial for all parties involved to prioritize the interests of the people. The allocation of constituencies should be done in a fair and transparent manner, ensuring that the voices of all citizens are represented. The BNF’s success in securing constituencies should serve as a reminder to the other parties of the need to listen to the concerns and aspirations of the people they aim to represent.
In conclusion, the BNF’s acquisition of 15 constituencies, despite ongoing negotiations, highlights their strong presence and support among the Batswana people. Their dissatisfaction with the current government leadership reflects the growing discontent in the country. As the UDC coalition prepares for the upcoming General Elections, it is crucial for all parties to prioritize the needs and aspirations of the people. The BNF’s success should serve as a reminder of the importance of listening to the voices of the citizens and working towards a better future for Botswana.
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Children’s summit to discuss funding of NGOS
One of the key issues that will be discussed by the Childrens’ Summit, which will be hosted by Childline Botswana Trust on 28th – 30th November in Gaborone, will be the topical issue of financing and strengthening of civil society organizations.
A statement from Childline Botswana indicates that the summit will adopt a road map for resourcing the children’s agenda by funding organizations. It will also cover issues relating to child welfare and protection; aimed at mobilizing governments to further strengthen Child Helplines; as well as sharing of emerging technologies to enhance the protection of Children and promotion of their rights.
According to Gaone Chepete, Communications Officer at Childline Botswana, the overall objective of the summit is to provide a platform for dialogue and engagement towards promoting practices and policies that fulfil children’s rights and welfare.
“Child Helplines in the region meet on a bi-annual basis to reflect on the state of children; evaluate their contribution and share experiences and best practice in the provision of services for children,” said Chepete.
The financing of non-governmental organizations (NGOs) by the state or its functionaries has generated mixed reactions from within the civil society space, with many arguing that it threatened NGOs activism and operational independence.
In February 2019, University of Botswana academic Kenneth Dipholo released a paper titled “State philanthropy: The demise of charitable organizations in Botswana,” in which he faulted then President Lieutenant General Seretse Khama Ian Khama for using charity for political convenience and annexing the operational space of NGOs.
“Civil society is the domain in which individuals can exercise their rights as citizens and set limits to the power of the state. The state should be developing capable voluntary organizations rather than emaciating or colonizing them by usurping their space,” argued Dipholo.
He further argued that direct involvement of the state or state president in charity breeds unhealthy competition between the state itself and other organizations involved in charity. Under these circumstances, he added, the state will use charity work to remain relevant to the ordinary people and enhance its visibility at the expense of NGOs.
“A consequence of this arrangement is that charitable organizations will become affiliates of the state. This stifles innovation in the sense that it narrows the ability of charitable organizations to think outside the box. It also promotes mono-culturalism, as the state could support only charitable organizations that abide by its wishes,” said Dipholo.
In conclusion, Dipholo urged the state to focus on supporting NGOs so that they operate in a system that combines philanthropic work and state welfare programs.
He added that state philanthropy threatens to relegate and render charitable organizations virtually irrelevant and redundant unless they re-engineer themselves.
Another University of Botswana (UB) academic, Professor Zibani Maundeni, opined that politics vitally shape civil society interaction; as seen in the interactions between the two, where there is mutual criticism in each other’s presence.
Over the years, NGOs have found themselves grappling with dwindling financial resources as donors ran out of money in the face of increased competition for financing. Many NGOs have also been faulted for poorly managing their finances because of limited strategic planning and financial management expertise. This drove NGOs to look to government for funding; which fundamentally altered the relationships between the two. The end result was a complete change in the operational culture of NGOs, which diminished their social impact and made them even more fragile. Increased government control through contract clauses also reduced NGOs activism and autonomy.
However, others believe that NGOs and government need each other, especially in the provision of essential services like child welfare and protection. Speaking at the Civil Society Child Rights Convention in 2020, Assistant Minister of Local Government and Rural Development Setlhabelo Modukanele said government considers NGOs as critical partners in development.
“We recognize the role that NGOs play a critical role in the country’s development agenda,” said Modukanele.