Until recent years, Botswana has been exceptional among the African nations in so many ways. The country has perhaps merited the most admiration globally for its unique ability to direct revenue from minerals towards development and economic advancement during its early years of independence, or rather soon after discovery of minerals more especially diamonds. It was through the money from diamonds that we built large part of our infrastructure including main roads, schools and hospitals. Sadly, as we write this commentary some of these infrastructures have been neglected and are deteriorating. That was a topic for last week anyway.
This week, we seek to remind the nation of yet another unfortunate reality of “hand to mouth” scenario in which we find ourselves in, despite the riches that the state accumulated over the booming years.
As we write this commentary, the middle class of this country is surviving on a hand-to-mouth basis (paycheck-to-paycheck), and in the process supporting their life-style with a semi-permanent and growing pile of debt. (See the Bank of Botswana annual reports for the past few years for details on how indebted we have been as a nation)
Before going further, we have to state though, that the current administration’s resolve to eradicate poverty is by all standards a very commendable effort, especially on the back of political will coming from President Ian Khama and his cabinet. In personally launching the poverty eradication programme some five or so years back, President Khama raised hope and legitimate expectation that his government is going all out to ensure that those Batswana living in poverty are removed from the jaws of poverty. We have always been of the view that there is no valid reason why some of our people should continue to wallow in poverty in a country that has long graduated from a low income to a middle income country.
However it would seem to us that as he gave attention to those Batswana that are living under severe conditions, his administration somehow neglected the middle class. It is quite evident that while Botswana has over the years experienced tremendous economic growth primarily due to the success of the mining industry, statistics show that those who have been counted amongst the middle class have become increasingly impoverished and marginalized. The margin between the rich and the poor has become more defined. As it stands, in a country like ours where the average income needed to buy the cheapest newly built house is almost double the average annual urban household income, home ownership in Botswana continue to remain an idea sought after but gravely unattainable. This is partly due to the “Hand to Mouth” life that most of our people live. This therefore calls for an honest reflection and genuine commitment to tackle income inequality that continues to grow not just in Botswana but even outside our borders.
In our view, there is no greater indication of a failed administration than that the majority of the population is living under the heavy yoke of poverty ÔÇô a hand to mouth kind of scenario. This is exactly what is going on in our country, a shining example of Africa. We are among the most unequal societies in the world. Most of the workforce remains either unemployed or languishes in low-paid jobs. Almost half of those with a job earn less than P4000 which disqualifies them for most financial services such as mortgage or even saving for the future.
But we ought to all agree that for real economic prosperity of Batswana, a simple recipe is required. Some consumption must be postponed ÔÇö it’s called savings. These savings must then be invested to expand the production capacity of the economy, which will lead to more production in future. But what is quiet clear at the moment is that most individual household’s budgets are not contributing to our country’s savings and investment ‘tank’.
Of course wasteful and irregular expenditure is rampant and has been well documented amongst our people but we believe that its contribution towards this high income inequality is low. In our view there is no single doubt that the root cause of poverty and unemployment among indigenous Batswana is undoubtedly a result of the many misguided and unsustainable citizen economic empowerment programmes that our government has pursued over the years.
In wake of this sad reality of high income inequality, we therefore challenge the current government and all interested parties to consider fresh ‘citizen-building’. Citizen-building involves providing people with the required skills to gather, understand and analyse evidence about the contexts and institutions that affect their lives ÔÇô particularly their economical lives. Our people need knowledge, support, services and opportunities in order to thrive financially. Business should be playing a key role in working with the government and other partners to deal with Botswana’s socio-economic challenges.
The government cannot do it alone. Business cannot do it alone. We need the two to collaborate not to finger point. Business should stop workers exploitation and the government on the other hand should ensure that the trading environment is conducive for the business to thrive, make profits and pay their workers what they deserve.
As we have said before, history has taught us that at some point, the poor will rise up in response to the corruption at the government enclave and exploitation by the business community. We would hope it does not come to that. The #Bottomline however remains that the situation, if not corrected, will reduce our people into nothing, but a laughing stock of the nations around us.