From the tone of local economic experts and industry insiders, the year 2011 in general is expected to be a better year for business locally as well as internationally, although this progress will be under uncertain circumstances.
Compared to the previous years after the global recession struck, economic recovery is said to be moving at a satisfying pace.
Economist and Managing Director of Econsult, Dr Keith Jefferis, says in general, the year 2011 should be a better year for business than 2010 was, but warns that the improvement will vary across industries.
One sector that he is optimistic about is the domestic sector, particularly mining; he predicts that market conditions will continue to improve throughout the year, judging by how the demand is quite strong at present.
The fact that economic growth in the United States of America is picking up is also a positive development for the mining industry, he adds.
“However, I am worried about local firms that are dependent on government funding. It is highly unlikely that this year’s budget will see any increase in government spending thus any sort of growth for these firms will prove challenging to attain,” said Jefferis.
The former Bank of Botswana Deputy Governor also predicts that the public sector should not expect any pay rise in the year 2011 even though the cost of living in terms of food prices has risen.
The good news, he adds, is that inflation is bound to come down and interest rates will stay low throughout the year.
“This year, I would like to see government becoming adventurous in terms of policy reforms to diversify the economy,” said Jefferis.
A local business owner in the service providing industry, Kgosietsile Mariri, also sees 2011 as a year where his field of work will experience growth in terms of expansion and attracting a wider customer base.
The recent price increase, which resulted after a review they carried out, also puts them on the right track as they are bound to make profits, says the young entrepreneur.
He explains that it was particularly harder to catch up with other industries because in his field, it took more than two and a half years for prices to be reviewed.
Mariri, however, points out that the review and the increase in prices was justified because the cost of raw materials internationally has increased and his business had to bear the burden.
“Business is growing all the time and our customer base is increasing. I honestly do not see any reason why we can not expand this year,” Mariri points out.
The umbrella body for local exporters and manufacturers, Botswana Export and Manufacturers Association (BEMA) is of the view that implementation of the Economic Diversification Drive (EDD) will reduce government’s reliance on imports and place emphasis on local markets thus lessening pressure on local businesses.
This, therefore, would mean that local businesses will be given a chance to develop and prove themselves. BEMA’s vision is to be dynamic catalyst for the competitiveness and growth of the Botswana’s export and manufacturing sectors.
Loago Raditedu, Executive Director of BEMA, said that they expect their members to make more money this year, retain their workers, and they also hope that workers’ salaries will be increased. He is adamant that even though the EDD will be a welcome development, they don’t want to lean on government policies and that will not change in 2011.
“As an umbrella body, the best that we can do for this year is to continue to make the best environment for our members to make more money than they made last year; we have no doubt that compared to previous years, this year will mean a significant growth in their businesses,” said Raditedu.
The fastest growing chain store, Choppies, promises more employment opportunities for locals throughout the country.
2010 was a good year for Choppies, which currently has more than 49 stores in Botswana and is set to open more stores in 2011. The well known store has also ventured into South African markets through the North-west province.
Choppies group CEO, Ram Ottupath, revealed that this year they are hoping to venture out into the Mozambique retail market as well as make plans for major expansion projects within Botswana and South-Africa.
Ottumah said that he hopes the economy picks up in 2011 so that their stores could continue to give people value for their money. Choppies recently took over OK Foods at Westgate, and it’s now known as Choppies Hyper.
According to the CEO, this means that the Hyper store is a much bigger store and its range is almost double that of the normal Choppies store.
“These expansions will bring along with them increased employment opportunities for locals in those specific areas throughout Botswana. Finally I hope that Choppies will have a peaceful and prosperous year ahead and we wish the same to our valued customers,” said Ottumah.
At the time of going to print, the Botswana Confederation of Commerce Industry Manpower (BOCCIM) had been reached for comment but had since not been able to respond.
BOCCIM is the main voice for the private sector in Botswana and it speaks sorely for the interests of the business community.