Mmegi: What are your initial impressions from the 2025-2026 budget speech?
WANG: This is the maiden speech of the new government, and there was a lot of anticipation from the public. It is a difficult budget because people always want more than you can offer. In this instance, I imagine the Vice President aimed to hit the Public-Private Partnership (PPP) target with the speech. Amidst an economic downturn, the Minister, as the lead economic policymaker, has a challenging task ahead.
The new government has made promises they intend to deliver, and I believe the VP is determined to do so responsibly, which is reflected in the speech. There are deliberate efforts to put the economy on a sustainable medium-to-long-term path despite limited resources, making it a difficult balance to strike. However, I think the speech succeeded in achieving that purpose.
The speech covered a lot of ground with several positive highlights. The VP emphasised restoring fiscal discipline and halting financial haemorrhage through specific measures, such as introducing immediate budget checks in Parliament. These are positive steps, and I believe the VP is sincere about fiscal discipline, which is essential for Botswana’s growth, historically known for prudent financial management. Returning to that path is crucial.
The speech also delivered a clear message on unburdening businesses and promoting investment. We were pleasantly surprised that the VP referenced our work on business readiness, indicating a willingness to improve and collaborate with stakeholders.
The real challenge for the new government is to mobilise state machinery to implement the positive actions they announced while also reforming the system. We are all watching with anticipation to see how this will unfold and stand ready to support the government’s efforts where possible.
Mmegi: There is quite a bit of focus in this budget on Public-Private Partnerships (PPPs). What is your take on PPPs and the urgency of their implementation in Botswana?
WANG: The VP’s mention of a cascading framework is significant. This approach means that with limited public resources, the government must ask: can the private sector handle certain projects? If so, the government should not fund them. For projects that are not entirely commercially viable, public finance can be used to incentivise private sector involvement through blended finance leveraging public resources to attract private investment.
The third step acknowledges that some projects, particularly social ones, will require full public funding. With limited resources, every pula should be used to mobilise more resources for Botswana’s development. PPPs fall within the second level of this cascade projects that need both public and private sector involvement.
Mmegi: What assistance can the World Bank provide in terms of the country introducing the PPP model in its development budget?
WANG: We have provided significant support through both technical assistance and capacity building for the PPP Unit in the Botswana government. We supported the drafting of the PPP framework, which was even referenced in the budget speech. Additionally, we have contributed technical assistance in developing Botswana’s PPP policy framework. The World Bank Group also has a private sector arm that provides PPP transaction services.
We have done some work in the water sector, though the deal has not yet come to fruition. Our role is to support both policy framework development and advise on specific PPP transactions.
Mmegi: You have spoken about the need to move towards productivity-led economic transformation as opposed to public or private sector-led. What does this entail?
WANG: There is a perception in society that private-led growth aligns with right-leaning politics, while public-led growth aligns with left-leaning politics. However, in the end, it is about productivity or how much output you produce from a given amount of input.
In Botswana’s early days, growth was rapid because investments, such as building the A1 road, yielded significant returns. However, as the economy matured, the returns on investment no longer led to productivity growth. Over the past two decades, Botswana’s growth has slowed due to structural challenges, compounded by external shocks such as the financial crisis and the COVID-19 pandemic.
To revive growth, Botswana must focus on productivity-led transformation. This requires not only a strategic national growth framework but also assessing the economic returns of individual projects. The Ministry of Finance has already begun this process, as reflected in the budget speech’s emphasis on total factor productivity. This focus is essential for ensuring that both budget allocations and economic strategies are geared towards enhancing productivity.
Mmegi: Any parting words?
WANG: Change don’t happen overnight. When I speak to my colleagues, I encourage everybody to engage Botswana with a renewed sense of energy coupled with a healthy dose of patience.
I feel there is a good story unfolding but of course the proof of the pudding is in the eating.
We do hope there will be concrete actions coming out of the budget and we are here to engage and provide the best that we can do.
