Finance Minister Kenneth Matambo reiterated perennial call for the diversification of the country’s economy with mineral exports and customs revenues continuing to dominate the trade figures accounting for two-thirds of government revenues.
This clarion was dampened by the realisation that total revenues and grants for 2017/18 financial year were at P56.41billion while total expenditure and net lending amounted to P58.39billion resulting in the overall deficit of P1.98billion or -1.1 per cent of GDP.
“One of the strategic initiatives identified to promote economic diversification is the Economic Diversification Drive(EDD), which was established in April 2010. The EDD is based on the approach of Government using its purchasing power to support local production of goods and services. To this end, P17.2billion or 53% of the total cumulative amount of P32.5billion worth of goods and services purchased by Government since the inception of the programme, was from local manufacturers and service providers,” said Matambo, in delivering his budget speech Monday.
He said, “The other initiative to diversify the economy is the implementation of the SPEDU revitalization programme. In this connection, the Government has approved a set of incentives for this region, which include 5 per cent corporate tax rate for the first 5 years and 10 per cent thereafter, for companies setting up in the SPEDU region, under the sectors of tourism, agriculture and manufacturing . Twelve companies were assessed and 10 of these have been approved.”
Matambo also announced efforts to accelerate the implementation of public-private partnership projects such as Zambezi Integrated Agro-Commercial Development, Gaborone waste water Treatment, Chobe-Zambezi Water Transfer Scheme and Strategic Oil Reserve at Tshele Hill.
The Government has during 2018/19 and 2019/20 financial years connected 43 new villages to the electricity grid whilst network will be extended to 72 villages countrywide. This will result in an increase in household access to electricity from the current 58% to 65%.
“I must hasten to say that lack of implementation or slow implementation within both the Government and the private sector, continues to be worrisome. Therefore, in the coming financial year, emphasis will be put on effective and efficient implementation of the Government programmes by ensuring adequate planning for such programme, including timely acquisition of land and all other activities that are necessary to prepare for actual implementation,” said Matambo.
He said, “In addition, the Government will be rolling out the implementation of the National Monitoring and Evaluation System approved in 2018, to ensure that the resources are used to deliver on their intended outputs and outcomes.”
Of total P67.5bllion expenditure planned for the 2019/20 financial year, P22.4billion or one third is for salaries and allowances for those employed in public service while the balance of P45.1billion or 66% will be available for Government procurement of goods and services from the private sector.
Union leaders have expressed a general satisfaction with emoluments of civil servants and urged political leaders to take stern action against corruption which was affecting completion of significant infrastructure and development projects.
“I am okay with the overview of the budget and if we could have implementation I would be happy especially Government projects like the water reticulation project in Kweneng. The shortage of water will be a thing of the past,” observed Masego Mogwera, President of the Botswana Public Employees Union (BOPEU).
She said, “There have been problems with completion of projects because of corruption otherwise we do not see a problem.”
The official forecast is that local economy will grow by 4.5% in 2018, 4.2% in 2019 and 4.8% in 2020. It means less revenues will be realized, calling for continued expenditure control in order to ensure that the country remains on a path f fiscal sustainability in the medium term.
