Africa-Press – Botswana. Government continues to play significant and catalytic in the country’s economy such as being a major investor through national development programmes, a major employer and procurer of goods and services both directly and through State Owned Enterprises.
Answering a question in Parliament recently, Minister of Trade and Entrepreneurship, Mr Tiroeaone Ntsima, said the ministry was conscious that government’s procurement behaviour directly affected business liquidity, competitiveness and overall private-sector confidence.
“Government and State Owned Enterprises form a substantial share of the market for many citizens owned companies especially Small and Medium Enterprises (SMEs),” he said adding that timely procurement and timely payment were essential to sustaining the health of business ecosystem.
He said commercial success around the world depended on reliable cash flow while delayed payments weakened a business’s ability to pay employees on time, service loans with financial institutions, procure inputs, restock and sustain operations, growth and job creation.
Furthermore, Mr Ntsima said delayed payments had a ripple effect across the value chain, lowering productivity and dampening private sector growth. On the other hand, he said failure by any arm of government to pay on time undermined business ability.
This, he said, was of particular concern to citizen owned enterprises and youth owned startups that often operated with limited working capital and heavily relied on predictable cash flow. Mr Ntsima highlighted that the mandate of the ministry was to facilitate trade, enterprise growth, and creation of an enabling environment for private sector.
He said the ministry of trade, together with the Ministry of Finance were already working together to address the backlog of unpaid invoices adding that a task force had been established to verify outstanding invoices, prioritise invoices for SMEs and citizen owned companies.
“Government has adopted digital procurement, payment reforms and the ministry is developing a policy position on prompt payment and resolve bottlenecks,” he said.
In addition, Mr Ntsima said that included collaboration with Business Botswana, Citizen Entrepreneurial Agency and Local Enterprise Authority Member of Parliament for Kgatleng West, Dr Unity Dow had asked the minister whether he appreciated that government played a significant role in the economy of Botswana.
Dr Dow wanted to know if the minister appreciated that government directly or indirectly through State Owned Enterprises and Entities was a significant procurer of services offered by private companies and individuals.
She also wanted to know if the minister appreciated that business or commercial success in Botswana and anywhere in the world depended on timely payments for services provided and goods sold and if the minister was aware that failure by government to timely pay for services and goods procured from private businesses undermined those businesses ability to in turn, meet their financial obligations.
She said the ministry would be failing in its mandate if it ignored the damage to specific businesses and did not address the current crisis of unpaid invoices by government.
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