Saturday, July 2, 2022

Only dynamism and competitiveness will see Botswana’s economy beyond diamonds

The latest World Competitiveness Report shows that Botswana has slightly moved up from 80 to 79.

Although in international terms this may sound roundly insignificant, as Batswana we should pause and even celebrate given that the two previous reports actually saw the country slide downwards.

As a country, there is a lot still to be done for us to be truly competitive.

We are fast losing out against countries against which we used to hold our own.

One thing that we must never lose sight of as a country is that there is an inextricable link between political action and economic success or, in our instance, failure when it comes to diversifying the economy.

It thus was reassuring to hear President Ian Khama reiterate his government’s commitment to economic diversification. This is an inherently political statement of intent, which will go a long way to reshaping the economic future of this country for many years to come.

Up until this week, we were worried that perhaps Government, as a result of many failed attempts to diversify the economy, had started to lose heart.

Our view is that we have no alternative when it comes to diversifying the economy.

Mining, especially diamonds, has indeed been very kind to Botswana. But we have to look for alternative engines of growth. Reports indicate that revenue from diamonds will plummet significantly around 2030.

That is a time when it is estimated that Botswana’s flagship diamond mines will have to go underground, making it very costly to extract diamonds.

There is no doubt that diversifying the economy will prove difficult.

It will be even so given that countries the world over are working hard at enhancing their competitiveness as a way of attracting capital and investments to their shores.

What we need to do is to work at those areas where we have comparative advantage, but also at areas that are within our power and influence as a country. Education is one area where we can still do better.

We need to produce graduates that are employable.

We should also strive to produce a calibre of graduates that could be exported to the world.
One area where the world over there is a shortage of is in the technical skills; engineering, medicine, science and technology.

We need to significantly beef our investments in these areas, not least because the past few years have seen not just under investment but neglect.

A closer look at our regulatory framework reveals a shocking lack of appreciation on just how business responds to conditions that prevail in the market place.

While we have made some strides towards enabling the private sector, the hard truth is that we still have a long way to go.

In fact, given the ever increasing competition we face from other countries in the quest to attract capital and investment, we cannot afford to rest a minute and boast at how peaceful a country we are.

We need to continually work at removing obstacles to business and commerce in Botswana; and there are many.

Our tax regime has to be revisited as should be the case with our immigration laws.
Our immigration laws are too rigid and, as a result, we are losing out on international talent.
People seeking residence and work permits are subjected to unnecessarily long and capricious demands.

We have to invest on the internet broadband.

We have to stop government from micromanaging business and allow the private sector to take charge of itself.

By its very nature, business and, with it, capital does not like excessive regulation.
Over regulation often has a brutal effect on business.

In fact, it is not unusual to see businesses closing down because they simply cannot withstand the jackboot of excessive regulation and red tape.

This is over and above the fact that excessive regulation is a breeding ground for corruption as the private sector, in keenness to beat the regulations resorts to paying officials to turn a blind eye.

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