The ongoing industrial action by more than 70, 000 workers involved in the fuel industry in South Africa threatens to, once again, disrupt business and trade activity in Botswana.
When the strike action started, Botswana Government was adamant that we will not be affected. That other routes and sources to supply fuel to Botswana had been secured.
But as we know, South Africa remains by far Botswana’s biggest gateway to the world.
Being a land-locked country, there is perhaps not much the country can do about overreliance on South Africa to get to the outer world. But we can certainly do something by way of minimising potential negative impact on Botswana whenever things that we have no control over happen in South Africa.
For example, Botswana authorities have absolutely no control on how long the industrial action in that country would take. Our Government also has no control neither on the pace nor direction of the striking employees and their employers.
All we can do is sit down, watch and pray that a settlement is reached between the interested parties in South Africa.
The Ministry of Minerals, Energy and Water Resources has since announced that plans are on the way to build bigger national fuel reserves somewhere in the Kgatleng area. Government is also moving to establish a state owned company whose role will be to, amongst others, ensure that strategic oil reserves are maintained and that the country looks to diversify its fuel sources.
Our view is that these two developments are long overdue.
It is crazy that a modern economy such as Botswana’s could in this day and age, where there are so many uncertainties, be running on a strategic reserve that can supply the country for a few days.
We need to build bigger facilities that can be able to carry Botswana’s economy for longer periods, especially at a time the economy has also been battered by frequent power outages that threatens the country’s businesses.
In this day and age, fuel is not only a strategic resource, its absence or, at the very least, the disruption of its flow can easily degenerate into a national security threat.
As a country, we have in the past learnt the hard way when we relied excessively on energy imports from neighbouring countries.
Today we are forced to build power stations at record time, having to borrow expensive money from the international market and also having to forego other national projects because energy is just of paramount importance. We could have built these power stations when everything was still cheap and also secure future power supplies without having to rely heavily on the imports.
The problem with economic disruptions on account of interrupted supply chains is that they do not correct themselves the day supply is restored.
The knock over effect carries on for many weeks and months, long after the supplies have been restored. Because things do not necessarily fall into line, the day supplies are restored, it goes without saying that some of those businesses that are not strong enough never fully recover as to continue. The end result is that they die out as a result of the disruptions.
As a country, we still need an empirical study to determine just how many of the small and medium businesses perished two years ago when power outages were at their height simply because such businesses could not absorb the extra costs that come with power disruptions.
Much more recently, it is not farfetched to say that there are certain businesses that collapsed as a result of the two months strike.
Certainly, many more businesses are yet to fully recover to their full potential following the said strike.
This is why we think Government should do all in its effort to build bigger and more enduring fuel reserves that could cushion the country’s fuel needs in cases of a crisis, especially that which we have little control over as is currently the case in South Africa.
And that time to bolster the reserves is now.
