Wednesday, September 23, 2020

In stepping away from the China road loan, Botswana chose fidelity

News coming out of government enclave that the authorities have decided not to proceed with borrowing from China to build the  300 km Nata Maun Road is welcome because it shows very good judgement by the treasury. And while we are there, when did attending a FOCAC summit or whatever jamboree they have out there, suddenly become a valid reason to sign up to opaque loan agreements? For decades we borrowed from traditional sources in the form of the World Bank, IMF, and other partners with no hidden agendas such as Kuwait and Japan.   

However that changed approximately three decades ago, when we allowed Chinese companies, which by the way are invariably state owned, to descend on our shores and send the local construction industry into a tail spin. Of course, we were not alone in rolling out a red carpet to China. Freeborn people in other parts of the globe also ushered China into the international trading system through the World Trade Organisation under what turned out to be a naive hope that by so doing, the latter would embrace our widely shared values of economic liberty and free markets. Needless to say that was not to be.

Since then we have paid a heavy price. The world’s folly in abetting China’s march to becoming the factory of the world has been laid bare during the coronavirus.  Coronavirus aside, here at home our economy and the construction sector in particular has borne the brunt of the relentless thirty year Chinese state sponsored onslaught. And it is absurd that in the midst of that onslaught, we still get regular propaganda pieces in the local media by their Gaborone based ambassador wherein he extolls the virtues of some wonderful friendship between Botswana and China.  He comes across like a man who spends too much time in rarefied diplomatic circles and conversely, very little on the ground with real people and construction workers.

The truth of matter is that local artisans look back to the pre Chinese times where they worked for companies that pursued a genuine and tangible skills transfer programme.  They now look in exasperation as Chinese firms working on mega projects here import pretty much everything from their homeland including manpower, equipment, construction vehicles and even workwear. Some may think that importing vehicles is much ado about nothing because we don’t have a vehicle manufacturing plant here. That is of course true but to a limited extent.  We have to remember that buying from local dealerships keeps the people that work for these establishments employed rather than importing vehicles all the way from China for project work. Moreover, the multiplier effect which communities used to enjoy because of major construction projects in their areas is now a thing of the past since the advent of the Chinese contractors.  

It is in that respect that the government’s decision to let the Chinese loan offer for the Maun Nata road fall through, will be endorsed by many. They have seen and understand the harm caused by a loan predicated on a Chinese contractor building the road.  

The government has now unshackled itself and is free to award the work to construction firms that have a track record of meeting our key objective of skills transfer instead of ones whose main goal is just cutting costs to the bone. This skills transfer thing we keeping harping on is a big deal for us. It has enabled many people who used to work for large construction companies to acquire skills that they then applied in building  houses especially in low income sections of our urban areas.

The decoupling also offers the government an opportunity to work with companies that carry reputations for building good quality projects.  


Read this week's paper

The Telegraph September 23

Digital edition of The Telegraph, September 23, 2020.