Govt urged to tap into local capital market

PATRICIA MAGANU
Staff Writer | Wednesday February 10, 2010 00:00

FRANCISTOWN: In reaction to the 2010-11 budget, Motswedi Securities MD, Martin Makgatlhe says that government has not done enough to utilise the local capital market to raise funds. He listed it as one of the expectations of the budget which minister of Finance and Development Planning Kenneth Matambo referred to in his budget speech. 'It was about time. In 2009, the government listed only one bond worth P300 million, yet it borrowed millions from foreign markets,' he stated.

Makgatlhe was one of the guest speakers at the budget review seminar hosted by Stanbic Bank in Francistown yesterday. He lamented the pace of economic diversification which he described as too slow and said there was still a high 'perception' of corruption particularly with government tenders.

'This impacts negatively on delivery,' stressed Makgatlhe.

Managing director of Stanbic Bank, Leina Gabaraane says that because of the 2009 economic challenges, the 2010-11 budget was especially interesting.   'Reflecting on the 2009 budget, we feel that this budget was the most important and most interesting coming right out of a recession,' he said.

He added that Francistown was the most affected by the recession last year because of its dependency on mines. 

'Francistown was the perfect place to hold the budget review because it was most impacted by the recent challenges in 2009,' he said.  'Mines shut down for sometime and Francistown saw a lot of hardships because of the economic recession,' stated Gabaraane. Makgatlhe pondered whether government lived up to the theme of the 2009 budget.

'Government introduced several measures that kept the economy afloat, thereby turning challenges into opportunities,' said Makgatlhe.

He highlighted the positive developments introduced by government.

'Government had already budgeted for infrastructural projects to spur economic growth and employment creation,' he said.

He mentioned the Morupule B Power Station Expansion, Zambezi Integrated Agro-Commercial Development Projects, The Botswana International University of Science and Technology (BIUST) and University of Botswana Expansion.  Still on the positives, Makgatlhe says there has been more emphasis on exploiting opportunities in downstream activities of the diamond pipeline such as beneficiation and aggregations.

He described the setting up of the six economic hubs as a good move. These are the diamond hub, education hub, innovation hub, transport hub, agricultural hub and health hub.