No subsidies on food for Botswana

OLIVER MODISE
Staff Writer | Friday July 25, 2008 00:00

 

In an interview, Merafhe dismissed suggestions that government could rescue the situation by subsidising both imported food items and fuel, arguing that the costs are not controllable.

'These are run away costs,' he said. Merafhe said that with prices increasing daily, it was very difficult to tell how far government would go if it provided subsidies for imported food items and fuel.

Merafhe acknowledged that the country faces a crisis. He refused to discuss the possibility of government providing subsidies on food and fuel as a way to cushion households that are already feeling the heat as a result of the rising cost of food and fuel.

He said that government treats the issue seriously as plans were already underway to review the agricultural policy in order to promote production and cut down on imports.
Merafhe said the rising fuel prices are a result of outside influences that leave very few options on the table.

He encouraged people to cut down on non-essential trips stating that where possible families should save petrol by sharing a vehicle.

In neighbouring South Africa, the Confederation of South African Trade Unions (COSATU) has taken to the streets in protest against the spiralling food and fuel prices.  

In a separate interview, Maria Machailo-Ellis, the executive director of the Botswana Confederation of Commerce Industry and Manpower (BOCCIM) has expressed concern about Botswana's foreign reserves arguing that the money might lose its purchasing power as the threat of rising food and fuel prices persists.

She said Botswana was a target for rising food prices because it imports almost all its food. 'We have to reduce dependency on imported food items,' she said, calling on government to promote local food enterprises.

Machailo-Ellis indicates that Botswana needs to develop the local food market, especially infrastructure development in the agricultural sector.
'Government could help by subsidising production,' she said.
She also complained that the increases had greatly eroded the Pula's purchasing power.
Machailo-Ellis has called for a study to probe into how the price hikes have dented the average person's purchasing power.

Meanwhile, the Mozambiquean government has announced that it will increase its 2009 state budget by five percent from this year's $3.8 billion to boost agricultural production and infrastructure development.
On the other hand, the Namibian government has taken a short-term measure to remove Value Added Tax (VAT) from basic food items.