Monday, October 3, 2022

Ministry of Finance’s grip on the economy is worryingly suspect 

The economy of Botswana, like the rest of the world is going through turmoil and uncertainties.

What the country needs is a stable pair of hands to reassure citizens that when stronger headwinds arrive, as it looks ever more likely there will be somebody in charge.

More than anything else, the country is simply clamouring for reassurance. Between the Monetary and Fiscal authorities, the Monetary side inspires more confidence. The fiscal authority seems to be forever dithering. It is wedded to short-termism and populist rhetoric. A lack of strategy and detail seem to headline every major pronouncement.

Announcements of economic policies are seldom accompanied by longer documents clarifying the thinking behind such decision. That, in our view is a recipe for disaster. It gives an impression that politics have all of a sudden taken over the economic thinking of the country. As things stand the economy is in need of more headroom to deal with inflationary pressures.

The cost of living crisis demands much more than announcements so far made by the Minister of finance which included allowance increase for tertiary students and a P120 million lifeboat for Botswana Meat Commission. The lifeboat for BMC was especially paltry. The announcement by the Minister of Finance has offered no reassuring from the people who looked up to her following months of anticipation. Households and businesses need help. Fuel and food prices have become an albatross on the necks of many.

She needs to find ways to cushion especially the unemployed. But truth be told, even the employed are now finding it extremely hard just to get by. We urge the Minister to once again take a look at what more she can do. She might have to go back to the market to borrow, if that does not do much to upset public finances. Her assistance to BMC was too small and in our view half-hearted. Given its woes that have dogged it for long, we are of the view that BMC needed something much more substantial.

Hospitals have no medicine. Schools and the rest of public infrastructure are dilapidated. Many are in a state of disrepair. Botswana is going through an economic crisis. This point has to be admitted by those in power, starting with the Minister of Finance. We need to get over from nostalgic talk. The minister has to demonstrate that she is on top of the unfolding crisis. That means taking hard choices.

Hard choices are part of running a functioning government. That also entails communicating what those choices are. It also means saying out in simple language what steps government is taking towards putting the economy back on a pedestal for future prosperity. So far she has a lot to do to win the confidence of many people. Harping on history and nostalgia only serves to diminish our ability to get back on the top of events.

We are no longer prudent in the economic management of our resources. But even more worryingly it has become clear that we have our priorities wrong. And that is not all. Today’s political leadership lacks technical experience on such matters like planning and economic management.

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