MTI steps up parastatal rationalisation

Pauline Dikuelo | Tuesday September 27, 2022 13:20

This follows President Mokgweetsi Masisi's March directive to rationalise state-owned enterprises and parastatals.

According to the directive, the Trade and Industry ministry has been directed to restructure the Botswana Development Corporation on non-agricultural sectors based on the approved lending threshold within three months and move it to the National Development Bank within those three months.

MTI was also ordered to transfer the functions of SPEDU to the Botswana Investment and Trade Centre (BITC) within six months and merge BITC with the Special Economic Zones Authority (SEZA) and Botswana Tourism Organisation (BTO) within two years.

Briefing the media recently, Trade Minister Mmusi Kgafela said they have already started the process and have held consultations with the affected parastatals. “We have, however, truncated the timelines but we are working around the clock to conclude this process seamlessly. As much as we are cautious about reducing government's financial burden, we also have to do this process in a manner that will not be disruptive to people’s welfare,” he said. To execute this, a private consultant will be engaged to ensure no personal interests in the exercise.

Further, the minister said they have a governance structure in place which comprises permanent secretaries from both MTI and the Ministry of Environment and Tourism, a board assigned, a project team assembled, as well as a communications team. “We fear that if we do this internally, we might have some personal interest involved and derail the whole purpose,” Kgafela said.

Over the years government has established several state-owned enterprises to regulate various sectors and implement policies. Further investigations revealed that government ministries and state-owned enterprises have the same portfolio responsibilities and competing client-base and programmes. Overlapping of mandates also existed which led to duplication of efforts.

“As a result, service quality was negatively impacted as customers did not see the right person the first time. Customers had to go from pillar to post to get the right service, which had cost implications,” he said. Rationalising state-owned enterprises and public entities in line with existing synergies will improve service delivery by creating centres where the public can get services.

Another goal of rationalisation is to eliminate duplications to promote efficient use of economic resources. This is in addition to general cost savings, enhancing corporate governance, and improving production efficiencies among the current disparate and discrete functions of selected state-owned enterprises and public entities.