Sunday, January 29, 2023

ESP has not jump-started the economy ÔÇôwhat then is next?

Now that the dust has settled over the glamour and fanfare with which the ESP was sold and marketed to the nation, it might be time the policy is evaluated.

Our view is that the ESP has failed in almost all the major objectives for which it was created.

Admitted, some few jobs might have resulted from the ESP.

But our assessment is that they were temporary, menial and low paying jobs.

Given that the ESP was started to create employment, we are of the view that the level of return has not been worth the magnitude of the investment.

To be fair to Government, the Economic Stimulus Package was designed with genuine concerns in mind.

Unfortunately, those concerns which were largely economic were allowed to be superseded by side concerns that were political in nature.

More to the point, in trying to address unemployment, the party in power had both its eyes set on politics; winning a next general election.

Politicising the ESP, as the ruling party so unashamedly did was categorically wrong-headed.

As we say, the ESP was created at least at face value to fight unemployment.

Instead it ended up assaulting to the bone what little was still functional in our economy.

Since the ESP, unemployment in Botswana has reached levels unknown since independence.

At the time that ESP was introduced, we warned the ruling party high priests of the pitfalls that they were courting for themselves in their spirited efforts to politicize the programme.

But the potential spinoffs from the ESP were so strong and tantalizing that politicians could not resists staking their names and signatures on the programme.

Instead of ring fencing the programme away from politics and selling it as a national policy, ruling party high command even fought among themselves over who was going to be its principal coordinator.

The more brash among them went as far as to suggest that the programme be managed from the party headquarters.

Clearly the ESP has not achieved what it was created to do.

If anything it has exposed those who sold it as a silver bullet to even more ire and disappointment-inspired public backlash.

And nobody wants to be associated with it, much less own it as their brainchild.

That said, the failures and shortcomings of the ESP have now amplified public calls for Government to come up with yet another populist programme ÔÇô possibly much bigger and certainly much bolder than was the ESP.

We are in principle not against economic interventions like the Economic Stimulus Package.

What we are however profoundly against is populist economic agendas that have no basis in economic thinking.

Populist economic policies invariably undermine efficiency and inevitably induce political risk.

To say the ESP was half-baked would be an irresponsible understatement.

Nothing best portrays the unpreparedness of Government in how the ESP was going to look like when it was first announced than the posture of President Ian Khama on television when he announced it.

He had with him a few scraps of papers.

And instead of spelling out the multi-billion pula programme, he resorted to the use analogies of wildlife  hunting and conservation ÔÇô perhaps not surprisingly, his favorite pastime.

The ministry of finance was in the dark about the programme.

Bank of Botswana, the government’s economic advisor had never had anything about it too.

Our view is that piecemeal initiatives like the ESP will not bring jobs.

What the country needs is a long-term strategy to entrench private sector business as a creator of employment.

We need to go back towards economic diversification.

Sadly we recently missed that opportunity when government coolly, craftily and misleadingly closed down the BCL mine.

With a real risk of disappointment,  we await with hope and anticipation the national budget speech due to be presented next month by the minister of finance.


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