Saturday, October 24, 2020

Good bye good times, Hello hard times

It’s been less than three weeks since Finance minister Kenneth Matambo delivered the 2016/17 budget speech. One ought to admit that this was one budget speech that cannot be read and shelved like others before it. Not because it was a juicy compilation, but simply because it paints a rather a gloomy picture of the domestic economy.

If Matambo’s speech is anything to go by, it seems our economy is headed for hard times. From the speech, it seems that after a long period of economic boom, especially before the 2008 recession, hard times have finally visited our beloved country, Botswana; hence the title, “Goodbye good times, hello hard times.”

From where we stand, it seems it’s not only Matambo’s speech that is telling about the stark the reality on the ground. Of late, the face of a smiling Motswana is as rare as a seeing or even reading of a thriving business in this country. For the first time in many years, HIV\AIDS is not featured among a major pressing issue in the country. Our problems are now financial and economic.

A few years ago, the rules and practice were simple: If one wanted a fat pay cheque at the end of the year they would join the private sector, stay late after work and carry a bulging briefcase by December. And if one was more concerned about job security, government enclave was where to look for a job. All that has since radically changed. The indication both on the ground and in Matambo’s budget is that ours is a limping economy. Therefore this calls for some changes. For some of our people, economic hardship means belt-tighteningÔÇö reducing the number of meals eaten in a day, skipping a vacation, going from being a two-car family to using one car. For others, it’s much graver – losing a job, a house or health care. Less could be said about the more than 20 percent of the population that continues to search for jobs.

As it stands, although inflation figures are generally low, mainly due to low fuel prices, food prices are continue to rise at a much faster pace. Despite this rise, wages have remained stagnant. This has left not just grim faces amongst Batswana, but empty trolleys are also visible in aisles of many of our retail stores.

The unfortunate thing is that experts pointed out shortly after Matambo’s speech that the economy may be in worse shape than previously thought or rather portrayed by Matambo.

We however remain hopeful, that with the right strategies in place, the country could still regain its stability.  This strategies we should warn the executive, require serious financial discipline. It does not entail increasing the government wage bill by increasing the number of cabinet and Members of Parliament. It also does not entail implementing a project as huge as the so called Economic Stimulus Programme (ESP) secretively. Financial discipline would in this instance entail embarking on stringent adjustments and reforms in our expenditure.

Given the recent observations of the impending economic challenges, we will have to reprioritize government’s activities and mobilise more resources that will help increase government revenue. This should be done bearing in mind that things may get worse before they get better. While on its part government should institute checks and balances aimed at ensuring that our country does not fall into the debt trap, it should at the same time instill a sense of financial prudence into its populace. This could be done through rigorous financial discipline, which will not be helped by wanton borrowing. It is however worth noting that this high household debt level seems to stem mostly from government’s continued ignorance of the principle of citizen economic empowerment.

Like we have noted before, until Botswana has a law on citizen economic empowerment, the current policy on economic empowerment remains nothing but a piece of paper to fill a gap. We continue to urge government to come up with a definite law on citizen economic empowerment because the current status quo puts the population at a disadvantage while unscrupulous foreigners capitalise on the prevailing environment. It is quite clear that, passing the test of standards and requirements, foreign owned companies are free to set up business in the country, thereby suffocating struggling locally owned businesses with their excessive funds and abundant resources.

While we attempt to avoid this deplorable situation, the #Bottomline remains that the much needed inclusive growth cannot be achieved without empowering the citizens of this country. Our people need to play an active role in economic activities. Until then Batswana can continue saying,” Good bye good times, hello hard times.” 

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