Thursday, July 16, 2020

Botswana owned by foreigners ÔÇô study reveals

A study commissioned by the Ministry of Finance and Development Planning has uncovered a pattern of bias in favour of foreigners in appointments to top management positions, salary payments and the award of government tenders.

The “Consultancy on the development of a comprehensive citizen economic empowerment strategy” by Tsa Badiri Consultancy, in collaboration with New Gx Capital of South Africa, turned up facts and figures showing that Botswana’s economic playing field is tilted against Batswana in favour of non citizens.

Although the report states that through its procurement strategies, government has the capacity to influence as much as 80 percent of economic activity, an analysis of companies awarded tenders by government through the PPADB shows that citizen owned companies got only 17 percent of the P1, 085 billion worth of government business between 2004 an 2006.

A survey of local companies and corporations showed that 53 percent of the top level- General Manager, CEO Managing Director positions – are held by non-citizens. The study further turned up information that the average basic pay of expatriates holding top management positions is 82 percent higher than that of Batswana holding similar positions.

Although the figures are shocking, they disguise worse differentials and are influenced by the facts that, in the parastatal sector, Batswana hold most management posts. This is not the case in other sectors.

In tourism, less than 14 percent of the top management posts are held by Batswana. “A similar picture emerges in the construction sector where two thirds of the top level positions are held by non-citizens. Even at the second level of management, non-citizens hold the majority of managerial positions,” the report stated.
A pattern emerges as you go to other sectors like manufacturing where “close to 60 of the top positions are held by non-citizens.”

“In addition to the dominant position within the managerial ranks, there are indicators that non-citizens continue to predominate in the professional category.” Out of the 67 fully qualified professional accountants registered with the Botswana Institute of Accountants the overwhelming majority (561) are non citizens. At the Fellow level, the differences are even more evident with only 29 of the registered Fellows being Batswana. The institute also registers 46 accountants as being partners – of which only six are Batswana.

The bias for foreigners is also reflected in the country’s salary differentials: “On average, non-citizen employees earn almost three times more than Batswana. The average basic monthly pay accruing to non-citizens in March 2005 was P7163 while the average monthly basic pay of Batswana was P2, 508. The disparity is highest in the parastatal sector where on average a non-citizen earned P21 738 compared to a citizen at P6 708 (less than a third).

In the private sector, the average rate of pay for citizens is around a quarter of that paid to non-citizens. In March 2005, the average basic for citizens was P1, 765 compared to non citizens at 6,544. In central government, the difference in pay between non-citizens and citizens is not so pronounced, but non-citizens are still paid, on average, just over double the rate for citizens.
Female non-citizens on average earn over 100 percent more than their citizen counterparts, the highest differential being in the private sector where a female non-citizen employee earns almost four times their citizen counterpart, followed by the parastatal sector at two and half times.

The report further states that, “it is doubtful that these very large differentials which vary across sectors can be wholly accounted for by the argument that most of the non-citizens will comprise professionals while the majority of citizen employees would be low skill workers. This argument also does not explain the large range of differentials between the various sectors particularly between the average earnings of citizen women employees and their non-citizen counterparts. The statistics therefore seem to confirm the widely held view that, when it comes to pay, non citizens are substantially more favoured than citizens.”

When it comes to professionals – such as accountants, engineers etc non -citizens are attracting a premium of 31 percent while expatriate middle and senior managers receive basic pay which, on average, is around 21 percent higher than Batswana.

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