According to a 1999 BIDPA working paper, Abdalla Gergis defines empowerment as, “helping people unleash their creative and productive energies to achieve sustainable growth and continuous improvement in their standard of living.” This definition is so much applicable to Botswana.
According to the paper, the rationale behind empowerment extends to more than just participation because “people can participate in a given process without having the power to make critical decisions related to the activity or process they are involved in.” The differentiation between participation and decision making implies an important factor of ownership.
In the past 40 years that the Central Bank has been in existence, there have not been any visible developments in terms of establishing an indigenous commercial bank. Although many people have sought to find out why this has been the case, there has been no reasonable response that has been given. Despite acknowledging receiving applications, the Central Bank confirmed that non have fulfilled the requirements for them to grant such an approval.
Critics have previously postulated that Central Bank licensing requirements are rigid which makes them less accommodative to a ‘seed’ bank as opposed to a mature bank with proven experience in the market. The banking sector, unlike the non-banking sector, has a fully grown history of regulation as indicated by a 33 year difference. Non-bank regulation was introduced in 2008, nearly a decade in existence. It would appear, however, that the sector with the least history of regulation has behind it success stories of citizen empowerment. It is however worth mentioning that the Central Bank issued out an instruction to commercial banks to localize their management positions in view of citizen empowerment. Former Cabinet Minister David Magang who has written extensively on economic issues of the country opined in his book that though welcomed, the move by the Central Bank is only ‘symbolic’.
The past decade however has turned up welcome developments within the non-banking sector. Under the non-banking sector, regulated entities include insurance firms, pension funds, asset management firms and the stock exchange. A pioneering development took place in 2015 when the first and only indigenous life insurance company was introduced to the market. This trailblazer, known as Bona Life, was described by its founder Regina Sikalesele-Vaka as an example that will inscribe a new norm that a citizen company can be created from nothing and built into something solid.
Two weeks ago an asset management firm, Afena Capital Botswana announced a pending approval by the relevant authority which if granted will transform the firm to be 100 percent citizen owned. The firm has almost five years operating in Botswana with roots from South Africa. The firm views this transaction as a ‘key milestone’ in the ongoing citizen empowerment process. Currently the majority shareholding (51 percent) of Afena Capital Botswana is under the Afena Capital Group which is based in South Africa.
The BIDPA working paper concludes that the “citizen economic empowerment is a socio-economic process through which Batswana are motivated to enhance their belief in self efficacy, to improve their ability to control their own resources and to unleash their creative and productive energies to achieve sustainable improvement in their standard of living.” One can conclude that citizen empowerment serves as a catalyst to further advance growth in the financial industry.