Structurally, there is something terribly flawed and defective with our economy.
For close to 30 years now, we have grappled (without much success) with ways of detaching this economy from the overweening influence of diamonds.
Billions of Pula down the line, and with not much to show for it, it is disheartening to note that we have failed.
Minerals, most especially diamonds, are not only by far the biggest mainstay, attempts by other sectors to carve themselves a place at the high table have proved shaky, unenduring and, in other instances, outright flops.
We continue to be an economy that is dominated by minerals ÔÇô diamonds to be precise.
This is not to say that there is anything wrong with diamonds ÔÇô or any minerals for that matter.
The trouble is the attendant risks of such an economic model.
The tragedy is that when the economy becomes a straightjacket, as is ours with just one commodity running the show, when it so happens that such a commodity for whatever reason fails the whole edifice comes down crumbling.
Zambia is by far the most vivid example of the risks inherent in such a model.
In the 1970s, Zambia, thanks to copper prices, was one of Africa’s best performing economies.
But when commodity prices collapsed in the 1980s, the entire Zambian economy went through a horrid experience.
The more uncharitable have, in the past, compared Botswana’s economy to an athlete who depends on habit forming stimulants for their performance, without which the athlete becomes a below average performer not worth talking about.
This may sound crude and cruel, but the analogy has some truth in it.
If ever there were any doubts about risks inherent in an economy that is not sufficiently diversified, the last three years have laid to rest such doubts.
Botswana’s fate was sealed immediately the world economy ran into trouble and the Americans stopped buying diamonds.
With diamonds no longer the provider they used to be, there was no other sanctuary under whose bosom we could seek refuge from the ensuing storm.
We were left naked, so to speak.
President Ian Khama has restarted the economic diversification debate.
It is a welcome debate, especially coming from a person who not so long ago used to think Botswana had all the money to play around with, including buying himself expensive toy aeroplanes and copters as well as financing his eccentric and bizarre visions as when, on his behalf, the state spent P20 million to renovate the State House.
Addressing the BOCCIM National Business Conference in Francistown this week, Khama reminded organised business that Botswana’s economy remained as vulnerable as ever.
The problem, said Khama, was that Government remained by far the greatest player in the economy.
He called on the players to evaluate and review current strategies and policies to ensure that diversification is successful.
Among the President’s suggestions is that it may well be that our national policy framework is inadequate or inconsistent.
Still thinking aloud, Khama surmised that it may well be that as a country we lack skilled manpower, or that our regulatory and policy frameworks are restrictive.
Or that the country was not sufficiently integrated into the global economy.
Our take is that the President is right in all his numerous observations.
In today’s world, it is simply unsustainable for Government to carry the weight of being the economy’s main driving influence.
Our failure to diversify our economy cannot be blamed on a lack of goodwill on the part of Government.
Government has shown a steadfast and resolute willingness to diversify the economy.
In fact, Government has been so eager to diversify the economy so much so that in many other instances, attempts to achieve those goals bordered on desperation.
Other than calling for a mindset change, we also have to look at the long term sustainability of our massive social welfare economy.
Already Government has run into trouble over school fees.
Reality has also struck on just how sustainable the amount of money Government is spending on its destitution programmes is.
International development partners have since waded into the debate on the structure of Botswana’s economy and warned us that public service wage bill is unsustainable.
