Africa-Press – Botswana. Botswana’s economic model needs refreshing. Diversifying Botswana’s economy has been an enduring struggle. But with every passing year the need to do that becomes ever more pressing.The country’s manufacturing base remains too small to even talk about.
The economy is dominated by mining followed by tourism as a distant second. Beef used to be part of the mix, but the mishandling of Botswana Meat Commission problems by government has now killed that industry. That situation is now worsened by a mistaken decision to allow export of live cattle by Botswana.
That will take this industry backward by a few years. As a result Botswana’s economic model is no longer able to carry forward the weight of the country, at least not as it used to. The burden has become too much. That burden has become not only heavier but also more complex.
Yet the model has remained constant for over forty years now. More than ever that model has to be reoriented. That reorientation has to take intro account the hard realties like the country’s small population. Governments efforts to try and improve food security are commendable.
What is not clear though is how far such efforts can go given that they are entirely de[pendent on a protectionist model. There is currently a blanket ban of several food imports from South Africa. Those banned food substances include vegetables, bread and fruits.
A lot still needs to be done to nurture the local food industry. After that there is still a need to ensure not just the volumes but also the quality of the produce. President Mokgweetsi Masisi has been shuttling the world to convince investors to come here.
He needs to change tact and get more focused and more selective on who he concentrates on. No investor is going to come here on account of the country’s foreign policy. Investors will come here after crunching the numbers.
For all of them, without exception the ultimate goal will be to make profits. The formation of BITC has helped address some road blocks that have traditionally been of concern to potential investors. As a country we need to change our catch phrases for attracting investors. Peace and stability are good. But now everyone has those.
And investors have long taken those for granted. In some instances, they are willing to put their money in places that have no peace nor stability as long as profits can be guaranteed. But there are still too many humps that need to be removed. Utility costs remain too high. Skills shortage is a big concern. As is labour costs. Digitisation remains too low. Productivity too is very low. The state continues to come up with more regulations at a time when competitors are forcefully pulling down regulations.
The turnaround time for registering a business in Botswana has significantly reduced. But there is still room for improvement if we are to catchup with peers and competitors. We need to be more agile, especially if we still seriously habour ambitions to become a hub for international finance. BITC say they are addressing the issue of factory space. The jury is still out. The much prized mining sector has its own problems. That sector is led by diamonds. But diamonds have become less profitable because getting them off the ground has become exorbitantly expensive as mines have become deep.
That presents serious problems of new investments that could enable going underground. And the country does not have the kind of money envisaged. That means going to the market for borrowing. Or at the very least cancelling and deferring development projects already approved.
Botswana has been deferring projects for too long now. Diversifying the economy is no longer a straight forward undertaking. The country needs to choose carefully on what it can do.
And whatever decisions are made, the country should target the export market. And beyond that the country should have clear competitive advantages like labour costs and the required skills in the sectors so chosen.
The country also lacks far behind in diversifying its energy mix. The country remains overly dependent on coal powered electricity generation. This is only risky but also potentially costly. Again we note the recently started government efforts through the National Development Bank to make finance available for people willing to start solar powered boreholes. This has to be extended beyond just boreholes. It has to apply to other industries, especially the small and medium sized. Diversifying Botswana’s economy has been an enduring struggle. But with every passing year the need to do that becomes ever more pressing.
The country’s manufacturing base remains too small to even talk about. The economy is dominated by mining followed by tourism as a distant second. Beef used to be part of the mix, but the mishandling of Botswana Meat Commission problems by government has now killed that industry. That situation is now worsened by a mistaken decision to allow export of live cattle by Botswana. That will take this industry backward by a few years.
As a result Botswana’s economic model is no longer able to carry forward the weight of the country, at least not as it used to. The burden has become too much. That burden has become not only heavier but also more complex. Yet the model has remained constant for over forty years now. More than ever that model has to be reoriented.
That reorientation has to take intro account the hard realties like the country’s small population. Governments efforts to try and improve food security are commendable. What is not clear though is how far such efforts can go given that they are entirely de[pendent on a protectionist model. There is currently a blanket ban of several food imports from South Africa. Those banned food substances include vegetables, bread and fruits.
A lot still needs to be done to nurture the local food industry. After that there is still a need to ensure not just the volumes but also the quality of the produce. President Mokgweetsi Masisi has been shuttling the world to convince investors to come here. He needs to change tact and get more focused and more selective on who he concentrates on.
No investor is going to come here on account of the country’s foreign policy. Investors will come here after crunching the numbers. For all of them, without exception the ultimate goal will be to make profits. The formation of BITC has helped address some road blocks that have traditionally been of concern to potential investors. As a country we need to change our catch phrases for attracting investors. Peace and stability are good. But now everyone has those.
And investors have long taken those for granted. In some instances, they are willing to put their money in places that have no peace nor stability as long as profits can be guaranteed. But there are still too many humps that need to be removed. Utility costs remain too high. Skills shortage is a big concern. As is labour costs. Digitisation remains too low. Productivity too is very low.
The state continues to come up with more regulations at a time when competitors are forcefully pulling down regulations. The turnaround time for registering a business in Botswana has significantly reduced. But there is still room for improvement if we are to catchup with peers and competitors. We need to be more agile, especially if we still seriously habour ambitions to become a hub for international finance.
BITC say they are addressing the issue of factory space. The jury is still out. The much prized mining sector has its own problems. That sector is led by diamonds. But diamonds have become less profitable because getting them off the ground has become exorbitantly expensive as mines have become deep. That presents serious problems of new investments that could enable going underground.
And the country does not have the kind of money envisaged. That means going to the market for borrowing. Or at the very least cancelling and deferring development projects already approved. Botswana has been deferring projects for too long now. Diversifying the economy is no longer a straight forward undertaking. The country needs to choose carefully on what it can do. And whatever decisions are made, the country should target the export market. And beyond that the country should have clear competitive advantages like labour costs and the required skills in the sectors so chosen. The country also lacks far behind in diversifying its energy mix. The country remains overly dependent on coal powered electricity generation. This is only risky but also potentially costly.
Again we note the recently started government efforts through the National Development Bank to make finance available for people willing to start solar powered boreholes. This has to be extended beyond just boreholes. It has to apply to other industries, especially the small and medium sized.
For More News And Analysis About Botswana Follow Africa-Press
