Economists reiterate need to prioritise high-return projects
Faith Siako | Thursday February 4, 2016 15:06
Speaking at a budget review seminar hosted by Stanbic Bank and Business Botswana at Cresta Bosele here on Tuesday, Tlhalefang said it remains worrisome that the country is failing to identify sectors that can help boost the economy.
He said that sectors like arable farming have proven that they have limited chances of boosting the country’s economy as many farmers are reliant on rainfall.
Tlhalefang argued that if the government wants to use arable farming as one of these sectors, then it has to provide facilities such as irrigation equipment so that farmers do not only rely on rainfall.
“Arable farming has limited chances of stimulating our economy mostly because farmers still rely on rainfall,” he said. He also said the proposed 2016/2017 budget is not expansionary despite the Minister of Finance, Kenneth Matambo categorising it as such.
He said the budget would not be expansionary because it is 3.2 percent lower than the revised budget. He also said it is important for the government to ensure that budget documents are provided to ordinary people cheaply so that they understand it.
“When ordinary people and businesses have access to the budget documents, the government would be in a clear position to account on how the public money and resources are used,” he said.
He added that without scrutiny, the government might make wrong choices on investing on inappropriate programmes and projects thus opening doors for corruption.
Tlhalefang mentioned that even though Botswana has invested a lot of resources on human capital through education, it had not managed to produce quality personnel.
“Botswana has invested in human capital, but the critical issue is the quality of education that it provides,” he said.
He added it was worrisome that poverty has not been reduced as a result of employment.
Tlhalefang also said that the performance of the economy is more worrisome when analysed on quarterly basis.
He said that when the economy is assessed on quarterly basis, the results reveal that the economy has contracted. “Quarter-on-quarter analysis reveals that the economy is in recession,” he said.
He also said that although the deficit went down from 3.8 percent to 3.1 percent, for a country like Botswana a deficit at the latter level is not worrisome because Botswana is in a strong economic position.
The Vice President of Business Botswana, Palalani Moitlhobogi said it is doubtful that spending in 2016/2017 budget focuses on high return projects because of lack of cost benefit analysis.
He said spending in some cases does not seem to be carefully prioritised to ensure prudent spending of scarce resources.
“The 50 percent increase in the defence spending when other things are squeezed is a typical example that there is lack of cost benefit analysis,” he argued.
He also advised the budget could have reaffirmed the role of the private sector as the engine of economic growth.
He said Business Botswana had expected Matambo to highlight measures to engage the private sector in order to manage projects and avoid cost over-runs and delays. “There is need for an innovative and clear strategy to grow the economy. This strategy should be anchored on the private sector as the engine of growth while government focuses on policy making and regulations,” he said.