Botswana secures P1.5 billion from African Development Bank
Last Friday, the board of Directors of the African Development Bank Group authorised a $137 million (P1.5 billion) loan to support Botswana’s Post COVID-19 pandemic economic recovery.
The funds, extended under the Bank Group’s Botswana Economic Recovery Support Program, will be used to enact multi-sector reforms that will increase spending efficiency, create jobs and drive inclusive growth.
The project has three components: enhancing domestic resource mobilisation and mitigating fiscal risks to enhance macroeconomic performance and create fiscal space for spending on social safety nets; supporting private sector-led agriculture and industry to bolster productivity and value addition and increase job opportunities, and offering business development services to micro and small enterprises to advance social protection and gender equity. The three components are expected to reinforce one another.
“The African Development Bank is providing support for reforms to enhance private sector-led agriculture and transformation of the industrial sector,” said Leila Mokadem, Director General of the Southern Africa Regional Development and Business Delivery Office. ”Agriculture value addition can serve as a springboard for industrialisation and job creation,” she added.
The project aligns with the Bank Group’s Ten-Year Strategy (2013-2022) and its High Five strategic priorities, particularly Industrialise Africa and Improve the quality of life of the people of Africa. The African Development Bank observed that Botswana has a very low risk of debt distress and a positive medium-term growth outlook. However, a lack of economic diversification exposes the country to significant vulnerabilities.
The Bank Group’s active portfolio in Botswana amounts to UA 57.7 million ($81.9 million) and comprises four projects. The financial sector accounts for the largest share of the portfolio by industry (97.1%), followed by agriculture (1.7%) and industry (1.2%). In the past, the African Development Bank partnered with various Botswana government agencies to accelerate economic growth.
On the 21st of February 2020, the bank signed a thematic Line of Credit (LoC) of P900 Million for a 10-year tenor with Botswana Development Corporation (BDC), a wholly state-owned investment agency. This was during that time, the single largest transaction of its nature to ever take place in Botswana.
The LoC was penned to support the BDC’s long-term strategy to scale up its investments in critical sectors, including manufacturing, transport and service sectors, with the overall objective of supporting the transformation and industrialisation of the Botswana economy. BDC eyed a more comprehensive socio-economic benefit with this partnership, including attracting investments into the economy and employment creation.
The African Development Bank is a multilateral development finance institution. It has an overarching objective to spur sustainable economic development and social progress in its regional member countries (RMCs) through mobilising and allocating resources for investment and providing policy advice and technical assistance to support development efforts.
This transaction was poised to support further BDC’s focus on safeguarding its balance sheet to ensure financial sustainability whilst fulfilling its mandate as the Botswana Government’s principal investment arm.
The COVID-19 pandemic has landed massive blows on Botswana; apart from claiming more than 2300 lives thus far, the contagious plague has exacerbated existing growth challenges. The effects of the pandemic have led to an estimated real gross domestic product (GDP) contraction of 7.9% in 2020, according to the World Bank, worse than that of the 2009 global financial crisis.
The contraction reflects the impact that reduced global demand, travel restrictions and social distancing measures have had on output in crucial production and export sectors, including the diamond industry and tourism.
Botswana’s fiscal deficit is set to widen to 11.3% of GDP in FY2020/21, from 5.6% in FY2019/20, reflecting a sharp decline in mineral revenues, a sticky public sector wage bill, and the impact of the COVID-19 spending. Similarly, the current account deficit is estimated to have widened to 8 percent of GDP in 2020 following the sharp decline in diamond exports.
Developments in the global diamond industry will significantly impact the short-term recovery, given Botswana’s dependence on the commodity. While recovery is expected in 2021 due to a favourable outlook for the diamond industry, the economic impact of COVID-19 is likely to be deep and long-lasting. The P1.5 billion African Development Bank loan comes after the World Bank approved a P2.5 billion boost for Botswana early this year.
The Programmatic Economic Resilience and Green Recovery Development Policy Loan (DPL) will support the implementation of Botswana’s Economic Recovery and Transformation Plan and is designed to strengthen COVID-19 pandemic relief while bolstering resilience to future shocks.
In August, Botswana received the International Monetary Fund (IMF) 189 Special Drawing Rights allocation worth P3 billion. The IMF SDR is a non-currency asset that Botswana can convert into hard currency by trading it with other IMF member countries.
ENVIRONMENT ISSUES: Masisi asks Virginia for help
President Mokgweetsi Masisi says the issue of sustainable natural resources management has always been an important part of Botswanaâ€™s national development agenda.
Masisi was speaking this week on the occasion of a public lecture at Virginia Polytechnic, under theme, â€śMerging Conservation, Democracy and Sustainable Development in Botswana.â€ť
Botswana, according to Masisi, holds the view that the environment is fragile and as such, must be managed and given the utmost protection to enable the achievement of Sustainable Development Goals (SDGs).
â€śIt is necessary that we engage one another in the interchange of ideas, perspectives, visualizations of social futures, and considerations of possible strategies and courses of action for sustainable development,â€ť said Masisi.
On the other hand, dialogue, in the form of rigorous democratic discourse among stakeholders presents another basis for reconfiguring how people act on their environments, with a view to conserving its resources that â€śwe require to meet our socio-economic development needs on a sustainable basis,â€ť Masisi told attendees at the public lecture.
He said government has a keen interest in understanding the epidemiology and ecology of diseases of both domestic and wild animals. â€śIt is our national interest to forestall the dire consequences of animal diseases on our communities livelihoods.â€ť
President Masisi hoped that both Botswana and Virginia could help each other in curbing contagious diseases of wildlife.
â€śWe believe that Virginia Tech can reasonably share their experiences, research insights and advances in veterinary sciences and medicines, to help us build capacity for knowledge creation and improve efforts of managing and containing contagious diseases of wildlife. The ground is fertile for entering into such a mutually beneficial partnership.â€ť
When explaining environmental issues further, Masisi said efforts of conservation and sustainable development might at times be hampered by the emergence and recurrence of diseases when pathogens mutate and take host of more than one species.
â€śWater pollution also kills aquatic life, such as fish, which is one of humanityâ€™s much deserved sources of food. In this regard, One Health Approach imposes ecological responsibility upon all of us to care for the environment and the bio-diversity therein.â€ť
He said the production and use of animal vaccines is an important space and tool for conservation, particularly to deal with trans-border animal diseases.
â€śIn Botswana, our 43-year-old national premier pharmaceutical institution called Botswana Vaccine Institute has played its role well. Through its successful production of highly efficacious Foot and Mouth vaccines, the country is able to contain this disease as well as supply vaccines to other countries in the sub-region.:
He has however declared that there is need for more help, saying â€śWe need more capacitation to deal with and contain other types of microbial that affect both animals and human health.â€ť
Masisi saddened by deaths of elephant attacks
President Mokgweetsi Masisi has expressed a strong worry over elephants killing people in Botswana. When speaking in Virginia this week, Masisi said it is unfortunate that Batswana have paid a price with their own blood through being attacked by elephants.
â€śCommunities also suffer unimaginable economic losses yearly when their crops are eaten by the elephants. In spite of such incidents of human-elephant conflict, our people embrace living together with the animals. They fully understand wildlife conservation and its economic benefits in tourism.â€ť
In 2018, Nthobogang Samokwaseâ€™s father was attacked by an elephant when travelling from the fields, where he stayed during the cropping season.
It was reported that the man couldnâ€™t run because of his age. He was found trampled by the elephant and was pronounced dead upon arrival at the hospital.
In the same year, in Maun, a 57-year-old British woman was attacked by an elephant at Boro and died upon arrival at the hospital. The woman was with her Motswana partner, and were walking dogs in the evening.
Last month, a Durban woman named Carly Marshall survived an elephant attack while on holiday in the bush in Botswana. She was stabbed by one of the elephantâ€™s tucks through the chest and was left with bruises. Marshall also suffered several fractured ribs from the ordeal.
President Masisi Botswana has the largest population of African elephants in the world, totaling more than 130 000. â€śThis has been possible due to progressive conservation policies, partnerships with the communities, and investment in wildlife management programmes.â€ť
In order to benefit further from wildlife, Masisi indicated that government has re-introduced controlled hunting in 2019 after a four-year pause. â€śThe re-introduction of hunting was done in an open, transparent and democratic way, giving the communities an opportunity to air their views. The funds from the sale of hunting quota goes towards community development and elephant conservation.â€ť
He stressed that for conservation to succeed, the local people must be involved and derive benefits from the natural resources within their localities.
â€śThere must be open and transparent consultations which involve all sectors of the society. It is against this backdrop that as a country, we lead the continent on merging conservation, democracy and sustainable development.â€ť
Masisi stated that Botswana is open to collaborative opportunities, â€śparticularly with identifiable partners such as Virginia Tech, in other essential areas such as conservation, and the study of the interplay among the ecology of diseases of wild animals and plants, and their effects on human health and socio-economic development.â€ť
Govâ€™t commit to injecting more funds in fighting HIV
Minister for State President Kabo Morwaeng says government will continue to make resources available in terms of financial allocations and human capital to ensure that Botswana achieves the ideal of eradicating HIV and AIDS as a public health threat by 2030.
Morwaeng was speaking this morning in Gaborone at the High-Level Advocacy event to accelerate HIV Prevention in Botswana. He said the National AIDS and Health Promotion Agency (NAPHA), in partnership with UNAIDS, UN agencies, the Global Fund and PEPFAR, have started a process of developing transition readiness plan for sustainability of HIV prevention and treatment programmes.
â€śIt is important for us, as a country that has had a fair share of donor support in the response to an epidemic such as HIV and AIDS, to look beyond the period when the level of assistance would have reduced, or ceased, thus calling for domestic financing for all areas which were on donor support.â€ť
Morwaeng said this is important as the such a plan will guarantee that all the gains accrued from the response with donor support will be sustained until the end when â€śwe reach the elimination of HIV and AIDS as a public health threat by 20230,â€ť he said.
â€śI commit to continue support efforts towards strengthened HIV prevention, accentuating HIV primary prevention and treatment as prevention towards Zero New Infections, Zero Stigma, Discrimination and Zero AIDS related death, to end AIDS in Botswana.â€ť
He reiterated that government commits to tackle legislative, policy and programming challenges that act as barriers to the achievement of the goal of ending AIDS as a public health threat.
In the financial year 2022/2023, a total of 119 Civil Society Organizations, including Faith Based Organizations, were contracted with an amount of P100 million to implement HIV and NCDs prevention activities throughout the country, and the money was drawn from the Consolidated Fund.
Through an upcoming HIV Prevention Symposium, technical stakeholders will use outcomes to develop the Botswana HIV Prevention Acceleration Road Map for 2023-2025.
Morwaeng stated that government will support and ensure that Botswana plays its part achieving the road map. He said there is need to put hands on the deck to ensure that Botswana sustains progress made so far in the fight against HIV and AIDS.
â€śThere are tremendous achievements thus far to, reach and surpass the UNAIDS fast track targets of 95%- 95%- 95% by the year 2025. As reflected by the BAIS preliminary results of 2021, we now stand at 95- 98- 98 against the set targets.â€ť
â€śThese achievements challenge us to now shift our gears and strive to know who are the remaining 5% for those aware of their HIV status, 2% of enrolment on treatment by those aware of their status and 2% of viral suppression by those on treatment.â€ť
Explaining this further, Morwaeng said shift in gears should extend to coming up with robust strategies of determining where these remaining people are as well as how they will be reached with the necessary services.
â€śThese are just some of the many variables that are required to ensure that as a country, we are well positioned to reaching the last mile of our countryâ€™s response to the HIV and AIDS pandemic.â€ť