At face value, the promulgation of the Economic Inclusion Law appeared to be what the doctor ordered in order to include Batswana in the high value economic sectors from which they have historically been excluded from for the longest time. It is an undisputed fact that Batswana have been absent from actively participating in the high value sectors of the economy like in the construction industry for example whether from their own making or as a result of factors beyond their control. With my view that Batswana have historically been absent from actively participating in the high value sectors of the economy, it should objectively speaking, reason that the Economic Inclusion Law could not be the answer to thrusting Batswana into the high value sectors of the economy as will demonstrated in this converstion. High value road and other projects as contemplated in the Transitional National Development Plan (TNDP) appear to firmly shut the door on the faces of citizen construction companies because local companies do not have the financial and other resources to compete with high value foreign construction companies.
One key target of the Economic Inclusion Law is “to promote effective participation of ‘targeted citizens’ in the economic growth and development of the economy, to facilitate enforcement of the economic empowerment initiatives….” Targeted citizen is described as ‘a citizen whose access to economic resources has been constrained by various factors…’ I argue very strongly that given the historical circumstances as alluded to above, the promotion of effective participation of targeted citizens under the Economic Inclusion Law will be a bridge too far for citizen construction companies to feed on the juicy cake that is the construction sector. As a consequence, the larger cake will remain the dominance of the multi-national construction companies as we see in the current construction landscape.
The discarding of the Public Procurement and Asset Disposal Board Act and replacing it with the Public Procurement Act appears at this early stage of the latter that targeted citizens are already put at a great deal of disadvantage in terms of for example, lodging an appeal in cases where a tender may have inappropriately been awarded. A targeted citizen company whose financial means and other resources relative to the multi-national company are poles apart, will be on the back foot to contest a tender they believe was corruptly or otherwise awarded. The end result is that the targeted citizen company will continue to be in most if not all cases, sub-contracted to high value construction companies.
It is imperative to briefly interrogate why local construction companies have not grown to levels that would put them toe-to-toe with multi-national companies. One key reason why this is so is that the construction industry like other sectors, have for time immemorial been handicapped by being involved in nefarious conduct like corruption whether advertently or inadvertently. It is daily cry in the construction industry that construction companies with close proximity to political power have always received cooked tenders which were they properly adjudicated, they would not have received. The first point is that such politically connected companies would not have the technical and financial wherewithal to undertake cooked tender. The second point is that flowing from the first point, such companies deliver hopelessly poor projects where in many instances, such are abandoned mid-way. These two points notwithstanding, such bogus companies will still receive revenue from such poor and abandoned projects principally because they are politically connected. Because these companies have for the longest time thrived on patronage more than anything else, they have missed the opportunity to grow on good business practises in order to ethically and morally compete with multi-national companies currently running the construction space. At best, most of the local construction companies were or are still fronting for big political heavyweights who directly or indirectly, have a substantial stake in the industry. As I write, local construction companies are miserably struggling to deliver the Mahalapye bus terminus whose value was just over P 10 million but continues to attract overruns costs. This is a serious indictment on the construction industry.
With the P 64 billion TNDP projects up for the taking, strict guidelines for the targeted citizen companies to even think of accessing the projects are prohibitive. As reported in the Sunday Standard newspaper dated January 5-11, 2023 under the heading ‘Closed tender for multi-billion Pula projects raises eyebrows’, the said newspaper report lists a number of requirements companies wishing to access TNDP projects should meet. One such is that ‘cash flows over past three years (expected BWP 2 million per month or equivalent) and average total certified payments received from contracts in progress or completed with the past five years (expiated minimum BWP 2 billion…..Bidders are also required to submit a typical organisational chart for a major project (> BWP 200 million) during each phase of study and project implementation’. Without saying, the odds are hugely stacked against the Batswana grown companies. How many if any Batswana companies would have successfully undertake a clean P 200 million project?
Would the Economic Inclusion Law apply to targeted citizens who are historically as already alluded to have been on the back foot owing to historical and other such factors? All things being equal, Batswana grown companies would be expected to benefit from the biggest chunk of the P 64 billion TNDP projects. The sad reality that must be highlighted without flinching is that no Batswana grown companies will be able to play a prominent role in these projects except if they are lucky enough to be sub-contracted at low value fee so low as to mark a dent on what the multi-national companies would derive as a lion share from the multi-billion TNDP.
Consequent to the fact that TNDP is pursued by the ruling Botswana Democratic Party politicians with regards to the upcoming 2024 general election, you can be rest assured grand corruption described by the Transparency International as quoted by the Sunday Standard report referred to in this conversation as ‘the abuse of high-level power that benefits the few at the expense of the many’ will be at full throttle. This abuse of high-level power…has been ably demonstrated by the grand corruption that occurred in the Covid-19 period. A few made a killing from the miseries of the many. High-level power is happy that the few who made a killing are now millionaires who should be emulated by those who never made it. Disgusting if you asked me!
Given that the Economic Inclusion Law is distinctly not in sync with the new Public Procurement Law owing to the many huge hurdles citizens still have to surmount, ‘targeted citizens’ in whose favour these two pieces of legislation were crafted appear to continue to be left in the lurch in the broader economic framework. As a consequence, such ‘targeted citizens’ will continue to scratch the surface by being involved in low value sectors like horticulture and as street vendors to mention but a few while multi-national companies rake in billions of Pula the big chunk of which will be exported to their headquarters domiciled outside Botswana. While it will be suicidal for local construction companies to be awarded high value projects in the TNDP, it is no excuse this should be the case. There is no tangible evidence the political leadership and the private sector have played a prominent role to ensure Batswana grown companies are promoted to claim their stake in the construction space. Nothing suggests this will be different in the foreseeable future. I am prepared to be persuaded otherwise as always. Judge for Yourself!
