This week, as we all are aware, the least-expected-thing happened in the southern part of Sub-Saharan Africa. One of the longest serving African leaders, Robert Mugabe stepped down as the President of neighbouring Zimbabwe. Mugabe has been the leader of that country for the past 37 years despite numerous calls by some, including our own President Ian Khama, to let go off power and allow other people to resuscitate the neighbouring country’s ailing economy. Mugabe has since been replaced by his former deputy, Emmerson Mnangagwa, whom some people fear has been cut from the same cloth as that of Mugabe. After his “positive” inauguration speech on Friday, we wait to see if he will do things differently or Zimbabwe has just replaced a Baobab tree with an Acacia one.
The Zimbabwean leadership succession is however not our main focus on this commentary but rather the opportunities that have re-presented themselves to us a country due to the changes in the neighbouring country of Zimbabwe.
Certainly recovery of a broken economy like that of Zimbabwe would not be possible in the absence of budgetary support from the international community including Botswana and the big brother down south, South Africa.
Although Mnangagwa is yet to throw his fiscal cards into the table, there is a general agreement that Zimbabwe is in need of drastic reinvention across political, economic and social domains following the ruinous reign of Mugabe. This is where neighbours like Botswana can fit in, not just for the sake of Zimbabwe but also for the benefit of their own citizens. It was in the wake of the 2008 political tension that Botswana made a few attempts to help its neighbour but the effort seems to have proved futile.
Following the collapse of an agreement through which Botswana was to extend a line of credit to Zimbabwe a few years back, a rekindling of a mutually beneficial relationship seems possible now than ever.
For the sake of those who might have forgotten, through the arrangement and agreement that was made then, Botswana was to avail a line of credit amounting to P500 million in a bid to resuscitate Zimbabwe’s industrial sector. As we all might be aware, the Zimbabwean economy’s industrial sector has been toppled by Mugabe’s policies which sought to indigenize production and manufacturing.
So it is unfortunate that the Bilateral Investment Promotion and Protection Agreement that was signed in March 2011 after the two governments of Botswana and Zimbabwe recognised the existence of vast investment opportunities between them hit a snag. There is no tangible evidence on what really went down.
The recent change in leadership has therefore come as a reminder of the failure by both governments as well as representatives of the commerce confederations to make use of an opportunity that availed itself at the time.
The recent change in leadership at the neighbouring country has also reminded us of a few facts about our economy and their economy. It is a fact that Botswana needs to create wealth for its citizens having failed to do so over the past 51 years. It is also a fact that there are factories in Zimbabwe that need to be rehabilitated and retooled. The question therefore is what kind of economic opportunities do leaders in both Botswana and Zimbabwe see? Should Zimbabwe look across the seas for foreign investors or should it look down south to Botswana to help rebuild its economy? Should Botswana send its unemployed youth to factories that are oversees or have them cross just one border and be equipped with skills?
Going forward, the two governments have an opportunity to forge new trade and business relations that could be of mutual understanding to their respective populace.
Last week in this space we commented on how Botswana should have, or can still fund some of its young professionals to go start up businesses in South Sudan. That example is applicable even in Zimbabwe. Batswana can, and should create joint ventures with skilled Zimbabweans to set up businesses that would not only make money for their families but would also be of economical benefit to the two neighbouring countries economies. These business relationships, if pursued can facilitate skills transfer and enable Botswana to establish its own production plants. Isn’t that a plus for Botswana and the people of this country?
Whilst in the meantime we are not sure how Botswana readies itself for a mutual benefit as a result of the changes in the neighbouring country, one thing remains certain. A country like Zimbabwe, with a bankrupt economy needs nothing but economic reforms and to open up to foreign investment. Botswana should take that risk and be counted amongst foreign nations that invested in Zimbabwe. This, of course we will, be doing with caution having learnt the hard way that it has been very difficult to put money into Zimbabwe and also almost impossible to get it back out. This past experience should however not stop us from doing what could be of benefit to our people going forward. As we write this, it was quiet clear that the “premature” exit of Mugabe has resulted in the people of Zimbabwe regaining a sense of purpose and seems to be looking forward to do things they have been reluctant to do over the several years. This change in attitude by the Zimbabwean natives will certainly result in a positive effect on their economy. We strongly believe that if we help them to rebuild it, then in a way we will be helping Batswana to create wealth.
In the end, the #Bottomline remains that we should make a deliberate decision to redefine the 2011 investment promotion agreement with our neighbours as a way of ensuring that as much as we lost economically over the years due to political tension, the exit of Mugabe becomes beneficial to us as well.