Overhauling the engine of economic growth
Mmegi Editor | Friday July 24, 2020 17:16
Extending loan repayment periods, increasing the amounts allowable and decreasing interest rights are the right combination to reinvigorate citizen economic enterprise, particularly at a time when the post-pandemic period will require such inclusive effort.
In addition, the special sectors identified as focal points for the revised guidelines are quite appropriate, being the areas where citizen enterprise is required to lead the necessary diversification of the economy.
Indeed, as President Mokgweetsi Masisi noted last week at their unveiling, the new guidelines will go a long way in ensuring a ‘competitive, sustainable and diversified export base that will ultimately reduce our import bill as a country”.
This is because the revised guidelines are not about government doling out money to help citizens start or expand their businesses. The broader picture is lifting the economy out of its middle-income plateau, a deceptively comfortable position where static growth rates belie growing challenges and risks.
Sizeable recapitalisation of CEDA balance sheet will be required to support the revised guidelines and this represents an investment by the Republic in its citizens, a good faith ‘loan’ that needs to be paid back to future fellow citizens in cash and kind.
Since its establishment, CEDA’s noble goals have been fraught with all manner of troubles, particularly low survival rates among benefiting businesses, as well as allegations of political favouritism, corruption and fraud in the approval system.
A case in point is that prior to the revised guidelines’ unveiling ceremony, documents circulated on social media purporting to show high profile beneficiaries of CEDA, whom it was alleged had been irregularly favoured over the years in loan approvals.
What the guidelines do is offer a fresh start for the noble objective of empowering Batswana and incorporating them in not only mainstream activities, but the much loftier goal of diversification and long-term sustainability. As much as encourage Batswana to support the revised guidelines and good faith investment by the Republic by committing themselves totally to the success of the businesses funded, CEDA, its board and parent ministry need also to be reminded that the country’s eyes are on their integrity.
This is especially important when it comes to the new focus on youth businesses, which are literally the future of this economy. Far too often, reports emerge of novice entrepreneurs being mistreated in one way or the other, at the hands of experienced project officers and others within CEDA. It is also an opportune moment to stress that the new funds flowing at CEDA will have a muted impact on the loftier goals of citizen economic inclusion, if they are not accompanied by policy and legal changes that allow Batswana enterprises to press into sectors they have been previously excluded from. To this end, we expect that the eagerly anticipated Citizen Economic Empowerment law due before Parliament in July will address the bottlenecks Batswana are facing in breaking into sectors where the titans of capital presently play.
Today’s thought
“Strength and growth come only through
continuous effort and struggle.”
– Napoleon Hill