How to make 2026 the year of job creation
Mphoeng Mphoeng | Tuesday January 13, 2026 17:16
The Umbrella for Democratic Change came into power on the back of a promise of creating 100,000 jobs but the state of the economy has not allowed them to work the magic they may have envisioned.
This has led to frustration from the citizenry and a concerted effort by the leadership to attract investment into the country. I believe that with a few tweaks to how we approach this challenge, we can make 2026 and 2027 years of a jobs’ explosion in Botswana despite the fiscal challenges.
I should first premise this by saying that most of what I will suggest already exists in policy and has been presented by myself in various fora in government in the past. Therefore, it would not be necessary to waste more money on consultancies and studies.
All that would be required is a push from the right offices and commitment of resources. It would also require a paradigm shift to realise that for jobs to be created, what we need is a thriving SME sector.
If you look at countries such as Germany with minimal unemployment, the driver of job creation is a large SME sector (the definition of SME in Botswana is usually companies that make up to P50 million a year depending on the institution).
Below are some of the key recommendations I would give on how to adjust our ecosystem to become Africa’s SME hub, how we would be able to attract talent and create a jobs boom (I repeat: most of these already exist in policy and just require implementation):
* Botswana needs to sort out our procurement ecosystem. Government continues to be the largest spender in the economy but we need to ensure that a large portion of this is directed to local businesses. According to the Public Procurement and Regulatory Authority (PPRA), public procurement amounted to P32.88 billion in 2024, but only 38% of this figure was done by local companies meaning a significant amount of our government spending is being exported.
The Economic Diversification Drive (EDD) policy enacted 15 years ago tried to deal with this but was largely not implemented as the problem still remains. This figure is also misleading because a lot of the business given to Batswana in supplies and tendering also goes to companies which are middlemen who simply purchase products from RSA for local supply.
Therefore, a large push must be for local procurement to encourage local manufacturing so SMEs in Botswana can supply consumables to government. This also exists in the EDD policy but it has been frustrated by unscrupulous procurement officials. Many businesses were set up in areas like SPEDU which have since died because government refused to purchase their products.
Why is this important? Bulb World in Selebi-Phikwe employs more people with its likely P50 million investment than what the envisaged P1 billion Dangote cement plant will. SMEs tend to employ more people while big money investments tend to spend money on machines and automation. * Related to the above, I would encourage procurement from local manufacturers in their respective geographical areas around the country; that is, to avoid one big tender for one company supplying all government.
Most government consumption of consumables is spread across the country and hence the manufacturing and supply should be the same. The Bulb World need not supply all Botswana but rather we should have five to six bulb making companies across the country all hiring 50 workers but being sustainable. I previously presented a programme of this nature where I proposed creating SMEs in different districts focusing on council procurement. The programme (called Kgetsi Ya Tsie) would work with LEA, CEDA and respective councils to assist in an intentional programme to set up businesses across Botswana using EDD principles.
I presented to Selebi-Phikwe Town Council, Francistown Town Council and Gaborone Town Council. Whilst they appreciated the idea, they did not have funds to execute so we approached Ministry of Entrepreneurship at the time. The PS at the time appreciated the idea and we engaged Debswana Citizen Economic Empowerment Program (CEEP) team who were keen.
As permanent secretaries got shuffled around in government, the idea fell through the cracks. The simple idea used existing policies and entities to create an intentional ecosystem to create jobs and disperse economic activity around the country leveraging on government procurement and simple import substitution. I am optimistic government could also ensure most private companies do the same i.e. companies in Selebi-Phikwe all agreeing to procure consumables such as toilet paper, cleaning liquids, peanut butter and others from companies and allowing them to have offtakes which make funding easier.
* In the past I have written about how leadership (past and present) tends to focus their efforts on finding big money investment and how we should rather focus on creating a conducive environment for SMEs to thrive. This approach has merits but should also include forcing these companies to utilise local SMEs rather than importing all of their inputs. This is a key tenet of the SEZA strategy.
When creating the business case for the Lobatse and Selebi-Phikwe Special Economic Zones, a key issue we highlighted was that a large company with huge investment, should commit to buying its inputs from local companies. For example, a company making leather boots for export, should buy its laces, leather, inners, soles and other items from local companies that make them, rather than importing. This would create a multiplier effect of jobs and economic activity. We have already seen mining companies attempt to do this via their CEEP programmes and this should be a key policy adopted and expected of every company.
* In order for the above to work, it would also require that we create a conducive environment for raising capital in Botswana. A key tenet of this is understanding what type of financing is required by companies at different parts of their lifecycle and ensuring these exist. As it is, Botswana (and most of Africa) have very inappropriate funding types at early stages.
I have written in the past about how CEDA needs to be changed because in its current form it is counterproductive on how SMEs should be funded. This was also included in our recommendations in 2024 on the NDP12 submissions for the Finance, Real Estate and Business Services (FREBS) sector. We need to move towards appropriate early stage venture capital financing using equity rather than debt. We also need to put all other funding such as YDF and other funds into one place and manage them focused on government priorities. For example, if we believe in BETP projects, why aren’t we assisting them with venture capital equity funding from CEDA etc? Why are we not creating an intentional ecosystem that utilises CEDA, LEA, YDF etc to push government priorities?
* Make Botswana an African financing hub where we fund businesses from across Africa. This would attract the best businesses with a caveat of making sure these companies come to operate from Botswana and set up and hire here. We would make it the easiest place to register and get funding in Africa and where companies can supply AfCFTA. This would create a boom in companies and jobs. This has also been included as a recommendation in our NDP12 submissions.
* Then reduce government red tape related to reporting, licensing, registering businesses etc. No need to expound here. Compliance costs too much in Botswana. Make it seamless and cheap.
* Put in legislation that relates to payment of services. A large issue that kills local businesses is delayed payments from government and big corporates. We must protect small businesses by ensuring people are paying on time and quickly. We must mandate government, parastatals and corporates to pay within five days for services below P100,000, 14 days up to P500,000 and one month up to P5 million (these are suggestions). This would save a lot of business and make them thrive. This should also be accompanied by punitive measures for any entity not following this.
All of the above are low hanging fruit since they already exist in policy in different areas. All they require is intentionality of making them work, and assigning resources. We are also available to assist in engaging with the leadership and law makers on the above and working with them to create the boom.
Botswana has all the ingredients to change itself and create an SME local led economy which can create the 100,000 jobs it envisages.
*Mphoeng Mphoeng is a director at a corporate finance, economics and investment consultancy, MP Consultants. He has previously worked at University of Botswana, BIFM, Standard Chartered and Bank of Botswana