Thursday, October 1, 2020

Botswana’s potential to meet Vision 2016 target over the edge

Botswana’s prospects of meeting the Millennium Development Goals (MDGs) and the national Vision 2016 are on slippery ground as the country got a knock from the global economic meltdown that ran riot last year.

Presenting his maiden budget, Finance and Development Planning Minister, Kenneth Matambo, under the theme “Transforming Our Economy After Crisis: 2010 and Beyond”, warned that the country experienced an “unprecedented loss of revenue” last year due to sluggish demands of luxury goods ÔÇö especially diamonds.

The move saw government’s development budget plunging as a result of the drowsy demand of the minerals exports ÔÇö the backbone of the economy ÔÇö in the international markets. The mineral sector accounts for over 50 percent of the GDP.

The development has greatly affected government’s grants and revenue estimated at P 27 billion against the intended spending of P 39 billion during the fiscal year 2010/2011.

That leaves a hole of P 12 billion that is expected to be financed through foreign sovereign reserves and the issuance of bonds on the local market.

“The crisis, therefore, threatens to stall the hard earned progress that we have made towards achieving the aspirations of Vision 2016 as well as the Millennium Development Goals,” lamented Matambo.

He said the current theme of the budget makes it imperative that Government identifies new opportunities for economic growth and to find additional sources of Government revenue.

The 2010/2011 fiscal year deficit is the second one in running, prompting the minister to issue stern warning the trend needs to be stopped before they tear apart the envisaged developments under NDP 10.

The NDP 10 started last year and is expected to end in the next six years. This presents a big challenge to government as MDGs deadline is in 2015ÔÇöjust a year before Vision 2016ÔÇötargets are met. Both plans assume that by then the level of poverty would have been halved if not greatly reduced.

Notwithstanding this acknowledgement of the need to try by all means possible to forego the risk of permanently lagging behind, analysts maintain that there was a lot of “economics” in Matambo’s budget than there was clarity in terms of the proposed way forward.
Dr Collie Monkge, Chairperson of the National Vision 2016 Council, expressed concern that it would be reassuring if it came out more clearly what Government would be doing within the next two years to reverse the tide of the crisis.

“The proposition that the deficits for 2010/11 should take us through the next two years presupposes some kind of stable transition when, in fact, there are indications that the situation will continue to be tough, makes compelling that one seeks to know what specifically will obtain in between this period,” questioned Monkge.
One example to prove the extent of difficulty waiting to be endured by the ordinary people in this country is that of having to pay for their children’s school fees, despite their own dwindling incomes.

Meanwhile, there is likelihood that more people are bound to lose their jobs partly due to retrenchments and as a result of privatization, thus joining many others that are already in the streets.

The ultimate bidding for Botswana Telecommunications Corporation (BTC) and National Development Bank (NDB), are expected to be on the boards soon after government plan aimed at finding its feet in the whole process.
Privatization, though credited for improving efficiency will have some direct impact on employees ÔÇô in the short term ÔÇô as some of them will have to be retrenched.

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