The Citizen Entrepreneurial Development Agency (CEDA), an agency which has been operational for six years now, this week held a media briefing whose aim was to update members of the media on CEDA programs since they started up until now.
The main focus of the briefing was on four areas, mainly what CEDA does to improve service delivery, assistance already extended, update on Young Farmers Fund and CEDA position regarding financing boreholes and cattle-posts.
In his remarks, the CEDA Chief Executive Officer, Thapelo Matsheka, stated that early last year, CEDA undertook a review of its operations to assess the performance and relevance of the program towards the achievement of its mandate. “The purpose of the review was primarily to find ways to improve on our operational efficiency and customer service,” he explained.
According to Matsheka, the implementation of the recommendations of the review saw the streamlining and rationalization of CEDA operations. As a result, he said, the regional offices were moved from Head Office to the regions. He stated that the expanding of CEDA footprints was to create greater access so that they can assist more clients who have been traveling long distances to come to the Gaborone office.
Though CEDA is believed to be a relevant program and an appropriate development strategy for the citizens of this country, there are some of the challenges that have been experienced in implementation of the program. These challenges, Matsheka said, included the issue of non-availability of land and necessary infrastructure, small domestic market and lack of ability by most citizen businesses to access the external market.
“The other problem encountered was that of the limited coordinated support by the government agencies and multinational companies doing business in Botswana,” he said.
The unfavourable procurement procedures and regulation as well as the repayment period of the loans and the P2 million loan ceiling also was a challenge to his agency, he stated.
“We believe the review of the PPADB Act, which is still under way and expected to be completed by next month, will address some of these critical challenges,” he said.
Ever since its inception and up until end of July this year, CEDA has received 8 852 applications to the value of P5 75 billion. Those processed were 1 641 and were valued at P924 billion. According to Matsheka, a high number of applications were either unsuccessful or closed down.
“The cause of rejection is mainly due to the fact that most people apply for the same projects all the time and lack of viability,” he explained. Those closed, he said, were primarily because the applicants failed to provide additional vital information as requested, which could assist in the assessment of those projects.
According to Matsheka, generally the performance of projects funded has not been satisfactory. He said the most affected projects are those in the service and retailing sectors.
“The total arrears level amount to P191 million and these two sectors account for almost 50 percent of these arrears figures. After all the remedial intervention, which include training and mentoring of the promoters has failed, he stressed that the Agency is forced to take the foreclosure route to cut on losses and to recover its money.
“About 355 projects, valued to the tune of P161 million, have been foreclosed,” he stated.
On the Young Farmers Fund, a fund which was put in place in response to aging farmers’ population, he pointed out that the fund started accepting applications in April this year. To-date, the Agency has received 66 applications to the value of P26 million. Out of those applications, only 17 were approved, and they are valued at P5.8 million. “The Agency has declined 21 applications valued at P8 million,” he stated.
He highlighted that there is reluctance in young people to come through hence their parents become the leaders and even made the enquiries. “We don’t want to see parents because this is the responsibility of young people,” he said. The challenges that CEDA faces, Matsheka said, are that of parents who have a tendency to use youth for financial gains. “This is where we have experienced an increased trend in parents leasing out under-developed land at exorbitant rates,” he said. “There is also lack of availability of land and basic infrastructure to prospective applications, and the submission of ill-prepared business plans.”
Commenting on CEDA’s position regarding funding of boreholes and cattle-posts, Matsheka stated that CEDA guidelines are clear that projects financed should show viability and sustainability. He said all projects submitted to CEDA for funding are subjected to a thorough evaluation to determine viability, sustainability and justification for funding.
“We need to be assured that cattle will always be there when we come for monitoring. We don’t want a situation whereby we find only the owner,” he said. “If the applicants can clearly demonstrate viability, CEDA is ready to consider submissions.”