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Permit Mzansi Mega Retailers

David Magang
VIEW FROM MANA HOUSE
 
Recently, Trade, Industry, and Investment Minister Honourable Vincent Seretse reiterated his stance that he was not going to buckle to spirited entreaties and grant South African chain store magnates a waiver to widen their footprint in the country by opening new outlets. Unless they partnered Batswana and gave them a controlling 51 percent stake in their businesses in the interests of citizen economic empowerment, he simply would not budge.  

Now, hang on folks: only a few months ago, President Ian Khama was quoted as saying Government was not going to dictate equity terms of engagement to investors lest they be scared off at a time when we desperately needed them. As such, I am at a loss as to which of the two pronouncements takes precedence over the other.

If we were to go by what the Trade Act provides for, then Honourable Seretse is spot-on. But the Act is not a single-track proviso: it allows the minister discretion to act as he sees fit. It does not oblige him to religiously adhere to the Act’s every canon.  In the past in fact, the minister even has had to overrule a High Court decision that the law as laid down be strictly enforced.  In the 80s, I was part of a supermarket establishment called Tsogang Investment (Pty) Ltd.

When the then Trade & Industry Minister Honourable Mout Nwako moved to relax the Trade Act and allow unqualified participation by chain stores domiciled in South Africa, we litigated against the gesture and the High Court ruled in our favour.  The minister countered by invoking his administrative powers and stuck to the status quo. In the event, the High Court decision did not come to bear.

So, should Honourable Seretse have his way or must the President intervene by issuing an “Open Sesame” directive?

THE ECONOMIC VOLKSTAAT

Let us first recognise that the retail industry is foreign dominated. This state of affairs I too have decried in my book, Delusions of Grandeur Vol. 2, the eighth chapter of which I have titled Foreign Retailers Run Riot in Botswana in revulsion.  The last time I checked, over 60 percent of the retail business in Botswana was in the hands of chain stores emanating from across the Limpopo.  That is an economic volkstaat in a sovereign country.      

Even the swashbuckling home-grown Choppies offers very little solace: it is preponderantly foreign-owned folks.  According to its 2015 annual report, 96 shareholders out of a total of 8,277 own 92.34 percent of the blue chip grocery titan.

The overwhelming majority of these are institutional shareholders all of whom hail either from South Africa (e.g. Sanlaam) or across the Atlantic (e.g. Citibank). Of the top ten shareholders, who account for 72.3 percent of the total stock, only Farouk Ishmael, with a stake of 14.6 percent, is Motswana. Choppies may command 35 percent of the local retail market but that should not be interpreted to mean the citizenry controls 35 percent of the same market.

In the normal way of things, sectors such as retail should be an arena in which the citizenry ought to rise and shine. It should be the means by which breakout citizen entrepreneurs escalate to higher economic heights over time so that they can strut their stuff alongside the Pick & Pays and Pep Stores of this world.

In Botswana, on the contrary, the retail sector is a virtual killing field: venture into this minefield as a citizen, and you will be instantly blown to smithereens.  Mzansi retail behemoths rule the roost and so sinewy and muscle-bound are they you will be turfed out with little more than a sardonic jerk of the thumb.  

Ours is a classic case of what Haris Bijoor calls “Retail Darwinism” – where the fittest endure, the fittest in terms of “offerings, deep pockets to survive wafer-thin margins, and the fittest in terms of the tenacity to fight competition that is irrational in its attack”.

Why have we booby-trapped our own economic cause? Well, the index finger should stiffly and angrily point in the direction of the Government enclave. For donkeys’ years, Government has been so suicidally lax in enforcing the Trade Act that we’re now toast to the mercantile impis from down south.  

WRONG TIME FOR REDRESS

Yet as much as we would love to tip the scale of proprietorship in the retail sector in favour of the citizenry, it is advisable that we tread with caution. A Chinese proverb that I like to quote says, “A journey of a thousand miles begins with the first step”. That should be our catchphrase too. Rash and impetuous measures are invariably counterproductive in the long term. We should be wary that we do not compromise overall macroeconomic salubriety by resorting to mercantile actions that play to the gallery of populist impulses.

At this point in time, we’re developing the Central Business District (CBD), potentially the country’s largest commercial centre, in the capital Gaborone. Dozens of supermarkets and shopping emporiums will soon arise there.  If the entrepreneurs who are putting up structures at CBD using hefty bank loans have to make a return on their investment, they will need well-resourced tenants from across the border. Otherwise, the structures are certain to be white elephants and the banks will not hesitate to foreclose.

The entrepreneurs who acquired plots at CBD and borrowed millions to develop them were counting on take-up by the likes of Game and Woolworths.  Maybe Government did not make an express undertaking to them that it would exercise flexibility on the Trade Act but they did trust to its sense of judiciousness. It would therefore be unfair and insensitive on the part of Government to now dictate terms that are certain to torpedo prospects of recouping their investment.

Their fate is similar to that of citizens who heavily invested in tertiary educational infrastructure – the Raja Ram’s and Odirile Gabasiane’s of this world: they did so in the belief that Government would enrol students in their institutions. If Honourable Unity Dow now was to say she would restrict student bursaries to Government-run institutions, it would spell disaster for them.  

Progressive Government policy should not be unilateral and arbitrary: it has to take account of the likely impact of that policy on those bound to be adversely affected. Thus, whilst Honourable Seretse’s stance is laudable as it is long overdue, the timing, regrettably, is most inauspicious.  

LET’S ADMIT THEM WITH STRINGS

Since at this juncture we need the big-bucks foreign retailers in view of the clothing and grocery infrastructure we’re mass-constructing, I would recommend that we fling the doors open for them. Let them have total ownership but with preconditions that will proportionately compensate for denying the citizenry a slice of the total stake. Exactly what must these be?

South Africa and India offer a little food for thought.   

India’s retail market generates annual revenues of about $600 billion according to the 2015 statistics. Until 2012, the market was closed to foreign participation. Then in November 2011, cabinet enacted a law that allowed foreign ownership ranging from 51 to 100 percent depending on whether the venture was multi-brand or single-brand. But several conditions were spelt out to prospective foreign investors.

Among these was that 50 percent of the stipulated minimum investment was to be set aside to assist in the development of back-end infrastructure (e.g.  storage, warehousing, distribution, and agricultural produce) in order to nurture an efficient supply chain. Another was that 30 percent of overall operational expenditure was to be devoted to sourcing produce from SMMEs whose plant and infrastructural development was less than $1 million.  That way, foreign investment into the retail sector would be a win-win situation for foreigners and locals alike.

In May 2011, Walmart, the US retail giant, acquired a majority stake in South Africa’s Massmart for $2.4 billion. Before the South African Competition Commission gave the nod to the take-over, it pronounced that Walmart orient R100 million toward a special fund for developing local suppliers in the next three years amongst other conditionalities. Surely, there’s no reason why that should not happen in Botswana.

There are multiple ways in which a nation could gain from compromising in one way or the other with the wishes of the foreign investor. What you lose in one respect you could subtly gain in another for as long as you do your math properly.  For example, if foreign chain stores were to be prohibited from vertically integrating, whereby they keep a stranglehold on the entire supply chain including horticulture, warehousing, and transportation, that would open up a host of highly lucrative business opportunities for the citizenry.      

CEDA SHOULD NURTURE MARKET COUP

Meanwhile, Government should put in place a viable strategy to spawn citizen retail entrepreneurs of the scale of the Wharton’s, the owners of Walmart, using CEDA as the primary lever. A benchmark that immediately comes to mind in this regard is Singapore.

The government of Singapore lent substantial technical and financial assistance to prospective local retail entrepreneurs, a far cry from the pittance our CEDA extends. The entrepreneurs were encouraged to band together and form their own franchises and cooperatives so that they could benefit from the economies of bulk purchases of stock-in-trade.

The Singapore government established enterprise promotional centres to impart entrepreneurial competence. It ran special training programmes that focussed on a productive and efficient mindset for employer and employee alike. A highlight of this training was exposure to requisite cutting edge technology, which included appropriate hardware and software.

Finally, the Singapore government made available business premises and sold it to the entrepreneurs in sectional titles which made it possible for them to steer clear of steep rentals private developers typically imposed.

China pretty much replicated the Singaporean approach. The strategy has paid off: of China’s top ten retailers today, only Walmart is foreign-owned.

In our case, CEDA has been reported to reject over 95 percent of applications from the retail sector on the pretext that the market is saturated. It isn’t at all. The 2014 Africa Retail Development Index says retail saturation in Botswana amounts to a mere 17 percent. The AT Kearney Global Retail Development in fact asserts that Botswana is the most promising retail market on the continent of Africa. A market is hardly ever fully saturated. For example, it is always said the South African retail market has virtually no room for new entrants but Choppies made the leap into the market anyway with highly promising results reportedly.

For citizens to stand toe to toe and trade blow for blow with a Game or Pick & Pay, they need funding in tens of millions of Pula and not the SMME-size sums CEDA routinely doles out. Otherewise, they would never progress from selling “magwinya for breakfast and seswa and paleche for lunch” as Professor Roman Grynberg aptly lamented in an op-ed piece.   

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The Daring Dozen at Bari

8th December 2020
JEFF---Batswana-smoke-unit

Seventy-seven years ago, on the evening of December 2, 1943, the Germans launched a surprise air raid on allied shipping in the Italian port of Bari, which was then the key supply centre for the British 8th army’s advance in Italy.

The attack was spearheaded by 105 Junkers JU88 bombers under the overall command of the infamous Air Marshal Wolfram von Richthofen (who had initially achieved international notoriety during the Spanish Civil War for his aerial bombardment of Guernica). In a little over an hour the German aircraft succeeded in sinking 28 transport and cargo ships, while further inflicting massive damage to the harbour’s facilities, resulting in the port being effectively put out of action for two months.

Over two thousand ground personnel were killed during the raid, with the release of a secret supply of mustard gas aboard one of the destroyed ships contributing to the death toll, as well as subsequent military and civilian casualties. The extent of the later is a controversy due to the fact that the American and British governments subsequently covered up the presence of the gas for decades.

At least five Batswana were killed and seven critically wounded during the raid, with one of the wounded being miraculously rescued floating unconscious out to sea with a head wound. He had been given up for dead when he returned to his unit fourteen days later. The fatalities and casualties all occurred when the enemy hit an ammunition ship adjacent to where 24 Batswana members of the African Pioneer Corps (APC) 1979 Smoke Company where posted.

Thereafter, the dozen surviving members of the unit distinguished themselves for their efficiency in putting up and maintaining smokescreens in their sector, which was credited with saving additional shipping. For his personal heroism in rallying his men following the initial explosions Company Corporal Chitu Bakombi was awarded the British Empire Medal, while his superior officer, Lieutenant N.F. Moor was later given an M.B.E.

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A Strong Marriage Bond Needs Two

8th December 2020

Remember: bricks and cement are used to build a house, but mutual love, respect and companionship are used to build a HOME. And amongst His signs is this: He creates for you mates out of your own kind, so that you may find contentment (Sukoon) with them, and He engenders love and tenderness between you; in this behold, there are signs (messages) indeed for people who reflect and think (Quran 30:21).

This verse talks about contentment; this implies companionship, of their being together, sharing together, supporting one another and creating a home of peace. This verse also talks about love between them; this love is both physical and emotional. For love to exist it must be built on the foundation of a mutually supportive relationship guided by respect and tenderness. As the Quran says; ‘they are like garments for you, and you are garments for them (Quran 2:187)’. That means spouses should provide each other with comfort, intimacy and protection just as clothing protects, warms and dignifies the body.

In Islam marriage is considered an ‘ibaadah’, (an act of pleasing Allah) because it is about a commitment made to each other, that is built on mutual love, interdependence, integrity, trust, respect, companionship and harmony towards each other. It is about building of a home on an Islamic foundation in which peace and tranquillity reigns wherein your offspring are raised in an atmosphere conducive to a moral and upright upbringing so that when we all stand before Him (Allah) on that Promised Day, He will be pleased with them all.

Most marriages start out with great hopes and rosy dreams; spouses are truly committed to making their marriages work. However, as the pressures of life mount, many marriages change over time and it is quite common for some of them to run into problems and start to flounder as the reality of living with a spouse that does not meet with one’s pre-conceived ‘expectations’. However, with hard work and dedication, couples can keep their marriages strong and enjoyable. How is it done? What does it take to create a long-lasting, satisfying marriage?

Below are some of the points that have been taken from a marriage guidance article I read recently and adapted for this purposes.

POSITIVITY
Spouses should have far more positive than negative interactions. If there is too much negativity — criticizing, demanding, name-calling, holding grudges, etc. — the relationship will suffer. However, if there is never any negativity, it probably means that frustrations and grievances are not getting ‘air time’ and unresolved tension is accumulating inside one or both partners waiting to ‘explode’ one day.

“Let not some men among you laugh at others: it may be that the (latter) are better than the (former): nor let some women laugh at others: it may be that the (latter) are better than the (former): nor defame nor be sarcastic to each other, nor call each other by (offensive) nicknames.” (49:11)

We all have our individual faults though we may not see them nor want to admit to them but we will easily identify them in others. The key is balance between the two extremes and being supportive of one another. To foster positivity in a marriage that help make them stable and happy, being affectionate, truly listening to each other, taking joy in each other’s achievements and being playful are just a few examples of positive interactions.
Prophet Muhammad (PBUH) said: “The believers who show the most perfect faith are those who have the best character and the best of you are those who are best to their wives”

UNDERSTANDING

Another characteristic of happy marriages is empathy; understanding your spouses’ perspective by putting oneself in his or her shoes. By showing that understanding and identifying with your spouse is important for relationship satisfaction. Spouses are more likely to feel good about their marriage and if their partner expresses empathy towards them. Husbands and wives are more content in their relationships when they feel that their partners understand their thoughts and feelings.

Successful married couples grow with each other; it simply isn’t wise to put any person in charge of your happiness. You must be happy with yourself before anyone else can be.  You are responsible for your actions, your attitudes and your happiness. Your spouse just enhances those things in your life. Prophet Muhammad (PBUH) said: “Treat your women well and be kind to them for they are your partners and committed helpers.”

COMMITMENT

Successful marriages involve both spouses’ commitment to the relationship. The married couple should learn the art of compromise and this usually takes years. The largest parts of compromise are openness to the other’s point of view and good communication when differences arise.

When two people are truly dedicated to making their marriage work, despite the unavoidable challenges and obstacles that come, they are much more likely to have a relationship that lasts. Husbands and wives who only focus on themselves and their own desires are not as likely to find joy and satisfaction in their relationships.

ACCEPTANCE

Another basic need in a relationship is each partner wants to feel valued and respected. When people feel that their spouses truly accept them for who they are, they are usually more secure and confident in their relationships. Often, there is conflict in marriage because partners cannot accept the individual preferences of their spouses and try to demand change from one another. When one person tries to force change from another, he or she is usually met with resistance.

However, change is much more likely to occur when spouses respect differences and accept each other unconditionally. Basic acceptance is vital to a happy marriage. Prophet Muhammad (PBUH) said: “It is the generous (in character) who is good to women, and it is the wicked who insults them.”
“Overlook (any human faults) with gracious forgiveness.” (Quran 15:85)

COMPASSION, MUTUAL LOVE AND RESPECT

Other important components of successful marriages are love, compassion and respect for each other. The fact is, as time passes and life becomes increasingly complicated, the marriage is often stressed and suffers as a result. A happy and successful marriage is based on equality. When one or the other dominates strongly, intimacy is replaced by fear of displeasing.

It is all too easy for spouses to lose touch with each other and neglect the love and romance that once came so easily. It is vital that husbands and wives continue to cultivate love and respect for each other throughout their lives. If they do, it is highly likely that their relationships will remain happy and satisfying. Move beyond the fantasy and unrealistic expectations and realize that marriage is about making a conscious choice to love and care for your spouse-even when you do not feel like it.

Seldom can one love someone for whom we have no respect. This also means that we have to learn to overlook and forgive the mistakes of one’s partner. In other words write the good about your partner in stone and the bad in dust, so that when the wind comes it blows away the bad and only the good remains.

Paramount of all, marriage must be based on the teachings of the Noble Qur’an and the teachings and guidance of our Prophet Muhammad (PBUH). To grow spiritually in your marriage requires that you learn to be less selfish and more loving, even during times of conflict. A marriage needs love, support, tolerance, honesty, respect, humility, realistic expectations and a sense of humour to be successful.

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Chronic Joblessness: How to Help Curtail it

30th November 2020
Motswana woman

The past week or two has been a mixed grill of briefs in so far as the national employment picture is concerned. BDC just injected a further P64 million in Kromberg & Schubert, the automotive cable manufacturer and exporter, to help keep it afloat in the face of the COVID-19-engendered global economic apocalypse. The financial lifeline, which follows an earlier P36 million way back in 2017, hopefully guarantees the jobs of 2500, maybe for another year or two.

It was also reported that a bulb manufacturing company, which is two years old and is youth-led, is making waves in Selibe Phikwe. Called Bulb Word, it is the only bulb manufacturing operation in Botswana and employs 60 people. The figure is not insignificant in a town that had 5000 jobs offloaded in one fell swoop when BCL closed shop in 2016 under seemingly contrived circumstances, so that as I write, two or three buyers have submitted bids to acquire and exhume it from its stage-managed grave.

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