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The Dangotes Ought To Be Feted

David Magang
VIEW FROM MANA HOUSE

Reading of our reported snub of the stratospheric African tycoon Aliko Dangote, I thought the gesture  constituted one of the most asinine by Government latterly. I gather, however, that  the big shot wasn’t actually denied a visa to enter Botswana: he just didn’t bother to venture down here because the last time he wanted to, in 2014, Honourable Edwin Batshu’s people told him point blank that he was not welcome!

To the parochial-minded people with a door-bouncer mentality who screen visitors to our country, every Nigerian, if not every West African, is the very embodiment of a drug contrabandist or money launderer. Botswana is “sacred” territory, the very “Holy of Holies” and therefore allowing a Dangote to set foot in it would amount to a sacrillege. It would profane Africa’s sanctum sanctorum.   

It seems hurling a voetsek at our brothers from ECOWAS is becoming something of a fetish. Clergymen from there who have been invited to propagate the gospel at Christian rallies have been stopped in their tracks.

Not too long ago, a high-powered business delegation that set off from Ghana to investigate prospects for investment had a rude awakening: only a “small fraction” of the ten of them were given the green light. In 2014, a local newspaper reported that 300 Nigerians had been deported in one fell swoop. To the best of my recollection, Government made no effort to gainsay such a claim.    

But it is not only West Africans who have been so rebuffed. Again in 2014, a well-heeled Hollywood film actor was told he was not welcome to our beloved country, his only offence being that he was headed our direction under the auspices of an opposition party.

Clearly, Government’s mindset is to tar everybody with the same stereotypical brush irrespective of their otherwise unimpeachable credentials. They may be a prominent businessman but if they hail from a certain part of the continent, we’re supposed to steer clear of them. By the same token, if they are moneyed all right but they are seen to be hobnobbing with people from certain disagreeable quarters, their greenbacks can be. The door must hastily close in their face with a bang.  

In the more level-headed and far-sighted countries right in our neck of the woods, government does not see a friend of the opposition: it sees a potential investor. It does not prima facie see a possible money launderer: it sees a person who could spend sizeable sums on tourist resorts. It does not see a West African with a thick native accent; it sees a cross-border venture capitalist who could help diversify its economy, boost employment creation, and help earn the country those crucial dollars, euros, or pounds. That’s an Aliko Dangote I’m talking about.  

HE’S THE DUDE WITH THE DEEPEST POCKETS FOLKS

“Africa’s Richest Man Denied Visa To Enter Botswana”.  That mind-boggling banner headline blared out of the front page of the Sunday Standard edition of October 6 2014.  Just what it is Government has against Aliko Dangote only the DIS could be relied upon to unpack for us, a remote possibility anyway since secrecy and confidentiality are its watchwords.   

I’m given to understand that the Immigration Director takes pride of place on the committee that assesses visa applications. My question then is, does this high-placed government official know who Aliko Dangote is?  If not, let me help drum home a few titbits in this regard.

For starters, Aliko Dangote is not Julius Malema, a budding Mzansi politician still rough at the edges who also was denied an entry visa to Botswana in 2014.  He’s the wealthiest man in Africa and the 67th richest man on earth according to the authoritative Forbes magazine. As of 2015, he was worth upwards of $17 billion, more than Zimbabwe’s annual GDP, which presently stands at just over $13 billion, and five times the critically ailing economy’s $4 billion annual budget.   

Dangote clearly is leading the charge to grow the continent from within. His flagship company, the Dangote Group, is present in 15 African countries, including Zambia, Zimbabwe and South Africa, and employs 26,000 across the continent. One of Africa’s largest conglomerates, the Dangote group portfolio encompasses investments in cement, food and beverages, steel, oil & gas, packaging materials, logistics, real estate, and telecommunications. In 2015, the company  generated over $3 billion in revenues.

Dangote is held in such high regard by governments who recognise the value and criticality of FDI to their economies he carries 8 passports.  

That is the economic colossus our blasé and closeted compatriots in the ranks of the immigration are fiddling with bagaetsho.  

TREATED LIKE A KING IN ZAMBIA, ZIMBABWE

Whilst our neighbours are tripping over each other to ensconce the Nigerian billionaire as a plank in their economic  platforms, we’re busy doing our best to fend him off as though he’s  leprous – a pariah of sorts!

In Zambia, Dangote has invested $450 million in a cement plant, with medium-term plans to up overall investment in the country twice over to $900 million. The plant has the capacity to deliver 1.5 million tonnes of cement annually. Altogether, Dangote is said to have created 7000 direct and spin-off jobs. His 400 haulage trucks alone are responsible for up to 1000 jobs.

To ensure production is not disrupted by the sporadic load-shedding that has dogged the country in recent years, Dangote has built his own 30 megawatt coal plant to generate electricity for the cement plant, with 10 megawatts available to the host community – the kind of investment we’re desperate for in Botswana.

In Masaiti, about 500 km north of the capital Lusaka, where his cement plant is located, Dangote has made available $500,000 to support burgeoning small-scale farmers. In addition, he’s building a school, a hospital, and other social amenities in the area. Furthermore, he has set up a scholarship for the Masaiti district to make it  possible for bright pupils from indigent families to pursue tertiary studies at accredited local universities.   

In July last year, Dangote commissioned a $610 million cement plant in Ethiopia, an investment he has since escalated to $1.3 billion. When a private citizen invited Dangote over to Zimbabwe, President Mugabe was so euphoric he rolled out the red carpet and just stopped short of showing him off in a ticker tape parade. The nonagenarian head of state granted Dangote licences for three projects worth $1.2 billion without the usual bureaucratic  hiccups.

Hearing that Botswana has effectively  cocked a snook at the filthy-rich West African, Mugabe must have laughed fitfully.        

A LEONTIFF PARADOX

It perturbs and even irks me why it does not seem to register in the government enclave that we need investors more than they need us. Show them the slightest sign that you have given them the brush-off and they will set their sights on jurisdictions  that fete and pamper them.

Let us take the example of   leading African social entrepreneur Fred Swaniker, who has lived and worked in more than 10 African countries. Swaniker is the co-founder of the Johannesburg-based African Leadership Academy. When he wanted to establish the African Leadership University in Mzansi, he was so encumbered by redtape that he threw in the towel and headed for Mauritius. It is there, in Port Louis, that he set about  building a $20 million campus.

Whereas the immigration office in South Africa had been dragging its feet to issue work permits to cosmopolitan personnel he needed for his higher education model for Africa, in Mauritius 40 permits were processed within the space of only two months. “If that is not efficiency, tell me what is,”   he gushed at the launch of his institution before an audience that included Mauritius President Ameenah Gurib-Fakim.

South Africa is one of 8 of Africa’s upper middle income countries (a bracket in which Botswana falls too) who are notorious for their penchant  for needlessly austere work and residence permit demands. Of their ilk, only Mauritius is the odd one out. For example,  Mauritius requires a visa from only six of Africa’s 54 countries. I hope our relevant authorities will take cue when they read this.

Make no mistake about this Honourable Batshu: when we fiddle with potential investors of  Dangote’s stripes, we do so not to his detriment but our own. I have had occasion to interact with even investors already resident in Botswana who have had to undergo quite an ordeal to secure permits both for themselves and their staff  and they all are unanimous that they are doing only a fraction of their potential in terms of committing themselves resourcewise to this country.

They say  they cannot devote resources proportional to the scale of investment they envisage in a country where their future is so glaringly uncertain, where they feel resented rather than embraced.  Indeed, the last thing they are prepared to do is to reinvest their profits or engage in further project expansion when a cloud hangs over their continued stay in the country they otherwise love and when the chances of importing the requisite manpower are well-nigh impossible.  

When we established the Botswana International Trade Centre (BITC), and BEDIA before that, it was with a view, primarily, to court foreign investors and to accord them hassle-free access to our country. Sadly, it appears the very institutions that are supposed to provide investors a smooth landing have turned into the investor’s worst nightmare.   

In the last three years, BITC has wolfed down an average of P100 million annually of taxpayers’ money to enable its officers to criss-cross the globe and proposition investors. Yet these same investors are turned away in the curtest way imaginable the moment they show up at our doorstep. The paradox is of Leontiff proportions.

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Economic Resurgence Options: Is Export-Led Growth Tenable For Botswana?

22nd September 2020

The world in which we live is a criminally unequal one. In his iconic 1945 allegorical novella,  Animal Farm, a satire on the facetiousness  of the then Soviet Empire’s crackbrained experiment with a command economy, the legendary George Orwell in my view hit the nail squarely on the head when he said all animals were equal but some animals were more equal than others.

That’s the never-ending dichotomy of the so-called First World and its polar opposite, the so-called Third World as Orwell’s cleverly-couched diatribe applies as much to the tread-of-the-mill laissez faire economics of our day as it did to Marxist-Leninist Russia a generation back.

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Victory is Won

22nd September 2020

Israelites take Canaan under General Joshua

Even as the Nation of Israeli braced to militarily take possession of the Promised Land, General, its top three senior citizens, namely Moses, Aaron, and Miriam, were not destined to share in this god-conferred bequest. All three died before the lottery was won.

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Finance Bills: What are they about?

22nd September 2020

Financial Reporting (Amendment) Bill, 2020 and Accountants (Amendment) Bill, 2020 were expeditiously passed by parliament on Thursday.

What are these two Bills really about?  The Bills are essentially about professional values that are applicable to auditors and accountants in their practice. The Bills seeks to basically enhance existing laws to ensure more uprightness, fairness, professional proficiency, due care, expertise and or professional technical standards.

The Financial Reporting Act, 2010 (FRA) establishes the Botswana Accountancy Oversight Authority (BAOA), as the country’s independent regulator of the accounting and auditing profession. BAOA is responsible for the oversight and registration of audit firms and certified auditors of public interest entities.

In the same vein, there is the Accountants Act, 2010 establishing the Botswana Institute of Chartered Accountants (BICA) which is responsible for the registration and regulation of the accounting and auditing profession. This consequently infers that some auditors have to register first with BICA as certified auditors, and also with BAOA as certified auditors of public bodies. So, the Bills sought to avert the duplication.

According to Minister Matsheka, the duplication of efforts in the regulation of auditors, which is done by both BICA and BAOA, creates a substantial gap on oversight of certified auditors in Botswana, as the two entities have different review procedures. He contends that the enforcement of sanctions becomes problematic and, thus, leads to offenders going Scot-Free, and audit quality standards also continue to plunge.

The Financial Reporting (Amendment) Bill, 2020, in the view of the Minister, brings the oversight and regulation of all auditors in Botswana under the jurisdiction of the Accountancy Oversight Authority and that Bringing all auditors within one roof, under the supervision of BAOA would therefore reinforce their oversight and significantly enhance accountability.

He also pointed that the Bill broadens the current mandate of the Authority by redefining public interest entities to include public bodies, defined as boards, tribunals, commissions, councils, committees, other body corporate or unincorporated established under any enactment.

This covers any company in which government has an equity shareholding. In order to enable the process of instituting fitting sanctions against violation of its provisions, the Bill clearly lays down acts and lapses that constitute professional misconduct.

This Bill further strengthens the sanctions for breach of the Act by public interest entities, officers, firms, and certified auditors. Reinforcing the law with respect to such sanctions will act as an effective deterrent for breach of the Act.

The Accountants Bill also strengthens the current mandate of the Institute by making it obligatory for those who provide accountancy services in Botswana to register with the Institute, and for all employers to hire accountants who are registered with the Institute.

The Minister reasons that in line with the spirit of citizen empowerment, this Bill proposes reservation of at least 50% of the Council membership for citizens. This, he says, is to empower citizens and ensure that citizenries play an active role in the affairs of the Institute, and ultimately in the development of the accounting profession in Botswana.

The Bills come at a point when Botswana’s financial sector is in a quagmire. The country has been blacklisted by the European Union. Its international rankings on Corruption Perception Index have slightly reduced.  According to recent reports by Afro Barometer survey, perceptions of corruption in the public service have soured and so is mistrust in public institutions.

Rating agencies, Standard Poor’s and Moody’s have downgraded Botswana, albeit slightly. The reasons are that there continues to be corruption, fiscal and revenue crimes such as money laundering and general unethical governance in the country. There are still loopholes in many laws despite the enactments and amendments of more than thirty laws in the last two years.

One of the most critical aspect of enhancing transparency and accountability and general good governance, is to have a strong auditing and accounting systems. Therefore, such professions must be properly regulated to ensure that public monies are protected against white color crime. It is well known that some audit firms are highly unprincipled.

They are responsible for tax avoidance and tax evasions of some major companies. Some are responsible for fraud that has been committed. They are more loyal to money paid by clients than to ethical professional standards. They shield clients against accountability. Some companies and parastatals have collapsed or have been ruined financially despite complementary reports by auditors.

In some cases, we have seen audit firms auditing parastatals several times to almost becoming resident auditors. This is bad practice which is undesirable. Some auditors who were appointed liquidators of big companies have committee heinous crimes of corruption, imprudent management, fraud and outright recklessness without serious consequences.

There is also a need to protect whistleblowers as they have been victimized for blowing the whistle on impropriety. In fact, in some cases, audit firms have exonerated culprits who are usually corrupt corporate executives.

The accounting and auditing professions have been dominated by foreigners for a very long time. Most major auditing firms used by state entities and big private sector companies are owned by foreigners. There has to be a deliberate plan to have Batswana in this profession.

While there are many Batswana who are accountants, less are chartered accountants. There must be deliberate steps to wrestle the profession from foreigners by making citizens to be chartered.  It is also important to strengthen the Auditor General. The office is created by the constitution.

The security of tenure is clearly secured in the constitution. However, this security of tenure was undermined by the appointing authority in many instances whereby the Auditor General was appointed on a short-term contract. The office is part of the civil service and is not independent at all.

The Auditor General is placed, in terms of scale, at Permanent Secretary level and is looked at as a peer by others who think they can’t be instructed by their equivalent to comply. Some have failed to submit books of accounts for audits, e.g. for special funds without fear or respect of the office. There is need to relook this office by making it more independent and place it higher than Permanent Secretaries.

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