Tuesday, May 18, 2021

Botswana’s economy is cluttered with institutions that perform duplicate functions

A leading researcher at the country’s economic think-tank Botswana Institute for Development Policy Analysis (BIDPA), Professor Roman Grynberg is baffled by the rate at which economic planners at the Ministry of Finance and Development Planning (MoFDP) have been disbanding state corporations that perform similar and overarching functions only to reinstate them using different names.

His main worry is that the trend is emerging at a time when both the World Bank and International Monetary Fund (IMF) have been warning Botswana about its bloated civil service and calling for a reduction of the public sector wage bill.

Professor Grynberg was shocked government economic planners in 2013 used parliament to enact the Botswana Trade Commission (BOTC), which he strongly believes should have been established as a unit in either the Botswana Investment Trade Centre (BITC) or the parent  Ministry of Trade and Industry.

Professor Grynberg says the creation of BITC was a result of prudent economic planning because at the time government correctly realized that the former Botswana Export Development and Investment Agency (BEDIA) and the International Financial Services Company (IFSC) were performing almost similar functions. However, he does not share the same sentiments about BOTC.

“BOTC was established to fulfill obligations under the Southern African Customs Union (SACU). Although the Trade Commission was a SACU obligation, there was no need to establish other parastatal which will in the long term fight for the same resources with BITC. Prudent economic planning dictates that the Trade Commission should have been created as a unit under the Ministry of Trade and Industry manned by a few experts instead of setting up of a fully fledged corporation. Alternatively the Trade Commission should have been established as a unit under BITC because of its overlapping functions. This is a clear waste and mismanagement of the few resources that the country has”, said Professor Grynberg.

He added that BOTC two or three experts in the field of trade should have been sourced to manage the unit under either MTI or BITC.

“It did not have to be another corporation or parastatal and in its current for it unnecessarily strangles the taxpayer. There is nothing in the SACU regulations that compels member countries to establish a corporation save that member states were obliged create a unit to undertake the functions. That could still be achieved using existing relevant structures,” said Professor Grynberg.

He added that the trade commission will have to be funded through government grants which would otherwise be directed to other pressing social and economic activities.

Another institution that Professor Grynberg believes should not have been set up independently is the Botswana International University of Science and Technology (BIUST), whose functions are a clear duplication of what the Faculty of Engineering and Technology (FET) at the University of Botswana is doing.

Professor Grynberg argues that it was unnecessary for Botswana to establish a second university offering the same courses as UB and FET.

“There is no eye to detail.┬á All these institutions with duplicated functions end up end fighting for the same turf and resources. Why should government overly burden itself?” asked Professor Grynberg.

Similar sentiments were echoed by another professor at BIUST who believes that instead of establishing BIUST, government should have consolidated and strengthened UB and FET.

He extends his debate to the creation of BITRI.

“To be honest, BITRI, UB’s FET and BIUST are now fighting for the same turf and resources. They should have been consolidated. ┬áThey will be churning out graduates who will eventually be jobless given our small economy. It does not make sense to have so many institutions providing similar services. One just hopes that these institutions will be able to churn out professionals who are marketable in the international arena. As for Botswana’s market, it seems saturated. Botswana Chamber of Mines is also training in the field of mining engineering. Where are we going to take all these children after graduation? Is the kind of education they are receiving preparing them for self-employment?” asked the BIUST professor.

According to Professor Grynberg, these are not the only institutions of concern. He extends the debate to the functions of Botswana Development Corporation (BDC), Citizen Entrepreneurial Development Agency (CEDA) and Local Enterprises Authority (LEA).

He argues that instead of setting up CEDA as a separate entity, government economic planners should have been prudent enough to create a unit under BDC solely geared towards financing and mentoring citizen entrepreneurs.

“Was LEA really necessary? It performs the same functions as CEDA.

Even the role of Botswana Bureau of Standards (BOBS) is not very clear. That is another institution that is not adding value to the economy. We should have just created a standards unit under the Ministry of Trade and Industry with the sole purpose of collaborating with the more established South African Bureau of Standards (SABS),” said Professor Grynberg.

He concluded: “Our argument should not be interpreted and understood to mean that we are against these institutions. The only reason we raise them is that Botswana’s economy is still small and these many institutions are underutilized. We cannot have fully fledged organizations doing the same thing. There is good reason to consolidate their functions properly so that our small economy is not strangled with unnecessary expenditures especially for functions that some other government owned institutions are already performing.”

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