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Is Masisi delivering on his inaugural speech? (Part 5)



This week, we are continuing with this series whose purpose is to consider whether or not His Excellency the President, Dr. Mokgweetsi Eric Keabetswe Masisi, is delivering on his inaugural speech promises, commitments and undertakings.  

Last week we dealt with his promise to build a modern Botswana that is not only open but is also able to openly compete with the rest of the world while maintaining Botswana’s founding principles of Democracy, Self-Reliance, Development, Unity and Botho. We also dealt with his commitment to address the problem of unemployment, especially amongst the youth who constitute about 60% of the population, something which he rightly said will address such ills as poverty, crime, HIV and AIDS and alcohol and drug abuse. 

We also dealt with his commitment to prioritise stimulation of accelerated economic growth through scaling up access to technical and vocational education and training opportunities; promoting digitisation across both the public and private sectors and devising smarter ways of tackling our poor education attainment at every level to make it more competitive. We also dealt with his undertaking to stimulate accelerated economic growth by ensuring that Development Financing Institutions become more proactive and responsive so as to better serve the requirements of their current and prospective clientele as well as helping government to achieve the goals of citizen economic empowerment initiatives.

This week we deal with H.E Dr. Masisi’s his commitment to stimulate accelerated economic growth by continuing with measures to ensure the Ease of Doing Business for foreign and domestic investors. We also deal with his commitment to promote the Economic Diversification Drive (EDD), an important strategy which he said is aimed at giving Batswana an opportunity to set up industries to empower themselves and, in turn, to create the much-needed employment.

We also deal with his undertaking to give potency to Botswana’s economic diversification aspirations by prioritizing the implementation of Cluster Development across various sectors, particularly the prioritized sectors of diamond beneficiation, tourism, beef, mining and financial services.  We also deal with his undertaking that government will also expedite the implementation of the Special Economic Zones (SEZs) which, he said, will contribute immensely to the socio-economic development of this country. Finally, we deal with his solemn commitment that his government will particularly intensify its efforts to revitalise the economy of the SPEDU region to effectively respond to the closure and liquidation of the BCL mine.

Firstly, his commitment to stimulate accelerated economic growth by continuing with measures to ensure the Ease of Doing Business for foreign and domestic investors. According to the latest World Bank annual ratings Botswana is ranked 86 among 190 economies in the ease of doing business. Botswana’s ranking deteriorated to 86 in 2018 from 81 in 2017. Ease of Doing Business in Botswana averaged 62.82 from 2008 until 2018, reaching an all-time high of 86 in 2018 and a record low of 39 in 2008, at the peak of the world economic recession.

It is, therefore, not surprising that during a recent two- day investment symposium dubbed ‘Doing Business in Botswana’, the Director of Investor Facilitation and Relations at Special Economic Zones Authority (SEZA), Neo Mahube, challenged Botswana to improve the ease of doing business for the country to remain competitive amongst its peers. According to the latest World Bank’s Ease of Doing Business report, currently, Botswana lags behind Mauritius, Zambia, Kenya and South Africa on the ease of doing business. According to Mahube, the bottlenecks that investors and local start-ups face to register a business should be resolved, adding that the country needs to be as efficient as possible to start a business, apart from improving credit efficiency. 

She, however, applauded government for the legislative amendments that have already been put in place ahead of the transformation journey, stating that through transforming the ease of doing business the country has potential to create employment. H.E Dr. Masisi’s government has to be commended for easing VISA restrictions for prospective investors, rationalization of company formation processes, improving bilateral relations and going on a global tour of investor attraction. 

Secondly, H.E Dr. Masisi’s commitment to promote the Economic Diversification Drive (EDD). The EDD initiative aims to diversify the economy by developing sectors other than the primary sectors, i.e. mining and agriculture, so that they contribute meaningfully to the country’s Gross Domestic Product (GDP). The Botswana Development Corporation (BDC), a state-owned enterprise, has an instrumental role to play in Botswana’s EDD, an initiative launched in 2010, and was initially planned to run up to 2016. 

The question is: has the BDC effectively championed the country’s EDD drive? In the Industry Division BDC owns or has significant stakes in several companies engaged in manufacturing. They include Lobatse Clay works, Matsiloje Cement, Sechaba Holdings and Prima Foods.  In the Agribusiness Division BDC offers a full range of products, including long term loans and equity available to investors looking to invest in agricultural projects and to exploit the opportunities available in the areas of dairy farming, poultry, irrigation, crop production, stock feed and livestock production.

BDC has also collaborated with the Ministry of Agriculture & Food Security through the Botswana Horticultural Council (BHC) to create the Botswana Horticulture Market (BHM) whose main objective is to provide a platform or place for local horticultural farmers to sell their produce. In the Property Division, BDC, as a development financier, has been active in the sustained growth of the property market, through its 100% owned properties, and partnerships. The Property Division is charged with developing and managing residential, commercial, hotel and industrial properties for BDC.

In 2011, BDC transferred some of its property investments into a new Company called Letlole La Rona Limited (LLRL). The company was subsequently listed on the local bourse in pursuant to the Corporation’s desire to transfer some of its investments into the hands of citizens who would not normally afford to acquire large properties owing to the large capital outlay required for such investments. Through the property division, BDC continues to promote economic diversification by facilitating activities in tourism; industry, agriculture as well as infrastructure and property development.

In the Services Division, BDC has considerable presence in the services sector where it has invested in tourism infrastructure, financial services and others. Among its services portfolio, BDC owns Botswana Export Credit Insurance Company (BECI), and has stakes in Investec, Healthcare Holding and Fairgrounds Holdings. The aforegoing notwithstanding, our economy remains undiversified. According to the Ibrahim Index of African Governance (IIAG) 2017 report, Botswana registered a mere 0.6%, ranking position 53 out of 54 countries in as far as diversification of exports is concerned.

This is probably because most of the companies established by BDC or in which BDC has a stake are not profitable and BDC has had to divest from them at marginal or no gain. We all know of the over P500 million which BDC lost through the failed Palapye Glass Project. Thirdly, H.E Dr. Masisi’s undertaking to give potency to Botswana’s economic diversification aspirations. While he has promised to attain this by prioritizing the implementation of Cluster Development across various sectors, particularly the prioritized sectors of diamond beneficiation, tourism, beef, mining and financial services, very little has been done in this regard. 

Fourth, H.E Dr. Masisi’s undertaking that government will expedite the implementation of the Special Economic Zones (SEZs). Objectively speaking, nothing much has been done beyond the establishment of the Botswana Special Economic Zones Authority (SEZA). This parastatal, which, like SPEDU, costs Government millions of Pula in administrative and personnel expenses, has, as its mandate, the development, management and regulation of the eight SEZs, namely Gaborone (with two zones), Lobatse, Palapye area, Selebi Phikwe, Tuli Block, Francistown and Pandamatenga.

These zones are intended to target such sectors as energy, cargo, freight & logistics, aerospace and aviation, mineral beneficiation, financial services, applied Information Communication Technology (ICT), water management, health services, Agro-business and manufacturing. Fifth, H.E Dr. Masisi’s solemn commitment that his government will particularly intensify its efforts to revitalise the economy of the SPEDU region to effectively respond to the closure and liquidation of the BCL mine.

However, one year since he assumed office, SPEDU, in which government has spent millions of Pula, mainly in administrative and personnel costs, is continuing in its failure to diversity the economy of Selibe Phikwe and the surrounding areas of Bobirwa, Tswapong North and Mmadinare-Sefhophe. Despite the launch, in March 2017, of investment incentives for the SPEDU region, no head way has been made in stimulating economic growth and the diversification portfolio of the region through private sector investment, technology development, market access and job creation as envisaged. These incentives include Fiscal Incentives, Government Off-take, Provision of Land, Input Costs, SPEDU Region labour Laws and One Stop Service Centre. 

The Fiscal Incentives include a 5% corporate tax for the first five years and a 10 % corporate tax thereafter. A sub category of Fiscal Incentives is provided in line with SACU provisions and it provides for zero customs duty on imported raw materials. There is also a direct government off-take on procurement of at least 30 % of quality goods produced locally. There is also an incentive for provision of land for a minimum of 50 years for land leases. As regards Input Costs, the region provides internet connectivity with bandwidth that are intended to promote business competitiveness as well as preferential ICT rates.

In terms of the SPEDU Region Labour Laws, it is envisaged that the SPEDU region employer and employee relations will be so cordial that they will provide a work environment which promotes productivity and harmonious employer/employee relations. Regrettably, despite these incentives, no single viable manufacturing company has been established in the SPEDU region since 2017 and there is no indication that one will be established in the near future. Consequently, none of the over 5,000 people who were retrenched when the BCL mine was closed has been absorbed by the SPEDU project. Meanwhile, BCL the liquidation process has cost government millions of Pula. 

Of course, having been in office for only a year, it would be unfair to wholly blame H.E Dr. Masisi for the aforesaid failures. It is, however, concerning that he has not yet set a clear economic diversification drive road map through which he can achieve the targets he set for himself in his inaugural speech. He talks of job creation, but job creation can only be achieved through an accelerated economic growth and diversification plan. 

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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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The Era of “The Diplomat”

30th November 2020

Youngest Maccabees scion Jonathan takes over after Judas and leads for 18 years

Going hand-in-glove with the politics at play in Judea in the countdown to the AD era, General Atiku, was the contention for the priesthood. You will be aware, General, that politics and religion among the Jews interlocked. If there wasn’t a formal and sovereign Jewish King, there of necessity had to be a High Priest at any given point in time.

Initially, every High Priest was from the tribe of Levi as per the stipulation of the Torah. At some stage, however, colonisers of Judah imposed their own hand-picked High Priests who were not ethnic Levites. One such High Priest was Menelaus of the tribe of Benjamin.

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Land Board appointments of party activists is political corruption

30th November 2020

Parliament has rejected a motion by Leader of Opposition (LOO) calling for the reversing of the recent appointments of ruling party activists to various Land Boards across the country. The motion also called for the appointment of young and qualified Batswana with tertiary education qualifications.

The ruling party could not allow that motion to be adopted for many reasons discussed below. Why did the LOO table this motion? Why was it negated? Why are Land Boards so important that a ruling party felt compelled to deploy its functionaries to the leadership and membership positions?

Prior to the motion, there was a LOO parliamentary question on these appointments. The Speaker threw a spanner in the works by ruling that availing a list of applicants to determine who qualified and who didn’t would violate the rights of those citizens. This has completely obliterated oversight attempts by Parliament on the matter.

How can parliament ascertain the veracity of the claim without the names of applicants? The opposition seeks to challenge this decision in court.  It would also be difficult in the future for Ministers and government officials to obey instructions by investigative Parliamentary Committees to summon evidence which include list of persons. It would be a bad precedent if the decision is not reviewed and set aside by the Business Advisory Committee or a Court of law.

Prior to independence, Dikgosi allocated land for residential and agricultural purposes. At independence, land tenures in Botswana became freehold, state land and tribal land. Before 1968, tribal land, which is land belonging to different tribes, dating back to pre-independence, was allocated and administered by Dikgosi under Customary Law. Dikgosi are currently merely ‘land overseers’, a responsibility that can be delegated. Land overseers assist the Land Boards by confirming the vacancy or availability for occupation of land applied for.

Post-independence, the country was managed through modern law and customary law, a system developed during colonialism. Land was allocated for agricultural purposes such as ploughing and grazing and most importantly for residential use. Over time some land was allocated for commercial purpose. In terms of the law, sinking of boreholes and development of wells was permitted and farmers had some rights over such developed water resources.

Land Boards were established under Section 3 of the Tribal Land Act of 1968 with the intention to improve tribal land administration. Whilst the law was enacted in 1968, Land Boards started operating around 1970 under the Ministry of Local Government and Lands which was renamed Ministry of Lands and Housing (MLH) in 1999. These statutory bodies were a mechanism to also prune the powers of Dikgosi over tribal land. Currently, land issues fall under the Ministry of Land Management, Water and Sanitation Services.

There are 12 Main Land Boards, namely Ngwato, Kgatleng, Tlokweng, Tati, Chobe, Tawana, Malete, Rolong, Ghanzi, Kgalagadi, Kweneng and Ngwaketse Land Boards.  The Tribal Land Act of 1968 as amended in 1994 provides that the Land Boards have the powers to rescind the grant of any rights to use any land, impose restrictions on land usage and facilitate any transfer or change of use of land.

Some land administration powers have been decentralized to sub land boards. The devolved powers include inter alia common law and customary law water rights and land applications, mining, evictions and dispute resolution. However, decisions can be appealed to the land board or to the Minister who is at the apex.

So, land boards are very powerful entities in the country’s local government system. Membership to these institutions is important not only because of monetary benefits of allowances but also the power of these bodies. in terms of the law, candidates for appointment to Land Boards or Subs should be residents of the tribal areas where appointments are sought, be holders of at least Junior Certificate and not actively involved in politics.  The LOO contended that ruling party activists have been appointed in the recent appointments.

He argued that worse, some had no minimum qualifications required by the law and that some are not inhabitants of the tribal or sub tribal areas where they have been appointed. It was also pointed that some people appointed are septuagenarians and that younger qualified Batswana with degrees have been rejected.

Other arguments raised by the opposition in general were that the development was not unusual. That the ruling party is used to politically motivated appointments in parastatals, civil service, diplomatic missions, specially elected councilors and Members of Parliament (MPs), Bogosi and Land Boards. Usually these positions are distributed as patronage to activists in return for their support and loyalty to the political leadership and the party.

The ruling party contended that when the Minister or the Ministry intervened and ultimately appointed the Land Boards Chairpersons, Deputies and members , he didn’t have information, as this was not information required in the application, on who was politically active and for that reason he could not have known who to not appoint on that basis. They also argued that opposition activists have been appointed to positions in the government.

The counter argument was that there was a reason for the legal requirement of exclusion of political activists and that the government ought to have mechanisms to detect those. The whole argument of “‘we didn’t know who was politically active” was frivolous. The fact is that ruling party activists have been appointed. The opposition also argued that erstwhile activists from their ranks have been recruited through positions and that a few who are serving in public offices have either been bought or hold insignificant positions which they qualified for anyway.

Whilst people should not be excluded from public positions because of their political activism, the ruling party cannot hide the fact that they have used public positions to reward activists. Exclusion of political activists may be a violation of fundamental human or constitutional rights. But, the packing of Land Boards with the ruling party activists is clear political corruption. It seeks to sow divisions in communities and administer land in a politically biased manner.

It should be expected that the ruling party officials applying for land or change of land usage etcetera will be greatly assisted. Since land is wealth, the ruling party seeks to secure resources for its members and leaders. The appointments served to reward 2019 election primary and general elections losers and other activists who have shown loyalty to the leadership and the party.

Running a country like this has divided it in a way that may be difficult to undo. The next government may decide to reset the whole system by replacing many of government agencies leadership and management in a way that is political. In fact, it would be compelled to do so to cleanse the system.

The opposition is also pondering on approaching the courts for review of the decision to appoint party functionaries and the general violation of clearly stated terms of reference. If this can be established with evidence, the courts can set aside the decision on the basis that unqualified people have been appointed.

The political activism aspect may also not be difficult to prove as some of these people are known activists who are in party structures, at least at the time of appointment, and some were recently candidates. There is a needed for civil society organizations such as trade unions and political parties to fight some of these decisions through peaceful protests and courts.

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