Employment creation should occupy NDP 10 Mid-Term Review centre stage
by Joseph Balise
As preparations for National Development Plan (NDP) 10 mid-term review gets underway, with fears of another recession looming, what are the key issues that need urgent attention to keep the economy afloat?
Renowned economist and Econsult Managing Director, Dr Keith Jefferis, said the major issues that he would like to see the mid-term review address are varied but should range from fiscal policy, budget sustainability to strategies for employment creation as well as promotion of diversified export growth.
In terms of budget sustainability, he said government has reiterated the need to return to past budget surpluses in a bid to rebuilding the financial balances that were depleted during the 2008/09 global economic recession.
“The biggest question is how government intends to achieve that objective in terms of revenue and expenditure projections. The mid-term review should come out clear on how that will be done and spell out the austerity measures that needs to be implemented to achieve the objective. It is an imperative objective if we are to keep the economy afloat,” said Jefferis.
He said the other issue of great concern is how government is going to promote diversified export led growth in the remaining years of National Development Plan 10. The economist observed that the country took a big knock from the past recession as diamond sales plunged exposing the economy to extreme external shocks.
He was, however, quick to advise that in addition to promoting diversified export led growth, mining should be imminently made part of the diversification strategy within deliberate measures to ensure diversification within the mining sector as a key economic driver.
Other issues of concern to be addressed by the mid-term review according to Jefferis should be deliberate strategies geared at employment creation, noting that currently “the economy is not creating enough jobs” for the many unemployed but employable people.
The 2009/10 Botswana Core Welfare Indicators (BCWI) survey released in December 2011 estimated an overall unemployment rate of 17.8 percent of the total labour force, which was up by 0.3 percent to the last reported 17.5 percent reported in the 2005/06 Labour Force Survey.
In terms of gender, unemployment rate was high among females at 21.4 percent as compared to men at 14.5 percent. The BCWI survey showed that most of the unemployed people were youth aged between 15 and 19 at 41.4 percent followed by age group between 20 and 24 at 34 percent.
The high unemployment rates among the youth normally reflect the difficulties faced by young people in finding jobs, particularly university graduates, according to the Ministry of Finance and Development Planning’s first quarter 2012 Quarterly Economic Bulletin.
The bulletin further notes that the major challenge faced by the youth is that the job market is saturated making it impossible for them to be absorbed in the labour market.
“Thus, it is more important now than before, to redirect and re-orient employment policies and training programmes by ensuring that the existing employment and income policies are cohesive and supportive of the overall government goal of economic diversification and private sector growth, initiatives that will contribute to creation of more employment opportunities,” states the bulletin.
“There are issues of labour markets and skills that need to be addressed. Strategies must be devised to improve the business climate given that some aspects of the business climate are not conducive with some getting worse rather than better. These are specifically with regard to immigration, land availability and speedy licensing of businesses. The processes are extremely sloppy,” said Jefferis.
He said government, in conjunction with Bank of Botswana, has also developed a financial sector development strategy and one will be looking at how it is going to be implemented.
Umbrella for Democratic Change (UDC) spokesperson Moeti Mohwasa said the mid-term review should address past failures and acknowledge that the neo-liberal policies that the country has over the years pursued are the causes of the current economic conundrum the nation is faced with.
“The trickle down approach breeds poverty and brings about inequality and unemployment.
Distribution of national resources cannot be left to chance,” said Mohwasa, adding that the citizenry of the country who over the years concentrated on formal employment and cattle rearing are finding it difficult to break into the mainstream economy.
He pointed out that they are now spectators in the theatre of economics and big business.
“The situation requires government intervention by way of enacting a Citizen Empowerment Act and introduction of chatters in different areas of the economy.
“These problems need an unapologetic and serious government which will provide legislative impetus to ensure that locals have a stake in the economy”, said Mohwasa warning that if they do not, then that very stake which they are denied access to could invoke an “Arab Spring” like revolution or rebellion.
“The government should ensure that as we go into the next lap of development, it pays attention to poverty, unemployment, economic inequality and citizen economic empowerment. These are matters that cannot be left to the invisible hand or free market forces. They require a government that cares about its citizens,” said Mohwasa, adding that unfortunately Botswana lacks a government that has such drive and zeal and the nation has to endure until 2014 when his party takes over with the support of the downtrodden and marginalized members of society.
In its Quarterly Economic Bulletin for the first quarter of 2012, the Ministry of Finance and Development Planning says after three and half years of implementing NDP 10, government has constituted MID-Term Review which is aimed at reflecting on achievements, constraints and challenges encountered during the implementation of the current plan with a view to where necessary change priorities and strategies to drive the plan going forward.
The review started in March 2012 with the formation of sector based Thematic Working Groups comprising of ministers, the public sector, private sector, civil organizations, think tanks and development partners. The Thematic Working Groups will determine national priorities for cabinet consideration and approval during the planning and budgeting period, align sectoral strategies, policies and programmes to the national priorities, carry out monitoring and evaluation for achievement of high level results as well as determining proposals for more cost effective use of financial and human resources through synergy and coordination of planning and budgeting processes for driving the development agenda of Botswana.