Gaborone – Botswana has established an Economic Recovery and Transformation Plan (ERTP) as it starts gearing for a post-corona economy and society.
The ERTP, under the auspices of the COVID-19 Economic Advisory Committee, is co-chaired by Secretary for Finance Dr Wilfred Mandlebe and Bank of Botswana Governor Moses Pelaelo.
Input for the ERTP largely came from the Finance and Economic Development Ministry, the Bank of Botswana, the Botswana Institute for Development Policy Analysis, the University of Botswana, and the Investment, Trade and Industry Ministry.
The ERTP’s objectives are to support restoration of economic activity and incomes, facilitate expansion of productive capacity, accelerate economic transformation and build economic resilience.
This will see the government targeting accelerated development of facilitative infrastructure, support for increased agriculture and manufacturing output, growth of the creative industry, improving the business environment and accelerating regulatory reform, promoting digital transformation, and addressing effectiveness of monitoring and evaluation frameworks and performance management, among other key areas.
Agriculture has been identified as a sector ready for greater investment, with focus on enhanced productivity and commercialisation. There will also be a social support approach to subsistence farming.
The horticulture sub-sector will see the National Agro-processing Plant assuming a bigger role in buying, processing and marketing; in addition to developing an export-focused value chain hinged on growth and innovation.
“The COVID-19 pandemic also gives the country an opportunity to increase agricultural production by investing in long overdue projects in order to reduce food imports,” the draft states.
More investment will flow into beef production, which remains a strong sub-sector, with the draft noting that rapid liberalisation - including removal of export restrictions on beef and live cattle – will grow the sub-sector.
“This would allow private sector abattoirs to export beef, subject to market access requirements and standards, and allowing farmers to export live cattle,” the draft states.
On health infrastructure and services, the draft says COVID-19 has thrown a spotlight on the need to continue to improve infrastructure, human resources, and research and development.
This will see the government exploring the possibility of redeveloping some hospitals that need repairs for specialisation for specific medical and clinical services.
Another sector identified for post-COVID recovery is tourism and hospitality.
The ERTP draft emphases promotion of local tourism to create a buffer to shocks such as COVID-19 which resulted in restrictions on international movements.
The construction sector, among other areas, will focus on rehabilitation and modernisation of schools as part of the drive to build a knowledge-based economy.
“Some of the roads connecting major tourist centres to the rest of the country are also important trade links. In some cases, these roads are in less than satisfactory condition and are in need of repair,” the draft adds.
The creative industry, dominated by the youth, is identified as having capacity to create more jobs and generate greater revenues as Botswana pursues economic diversification.
“The ERTP could also target local film, programme and documentary producers and ensure that BTV content is predominantly local such as the case in South Africa and Nigeria where the local film industry has grown considerably over the years,” the draft says.
On manufacturing, the draft ERTP notes that the sector is crucial to import substitution and can create many jobs as it is generally labour intensive considering that Botswana’s economy – like that of many emerging economies – is not yet overly reliant on technology-led processes.
With regards to mining, the draft says achieving long-term sustainability in diamond mining should include a shift to automated and high-tech production to reduce production costs.
The informal and semi-formal sector, the draft says, remain important and require investment in basic facilities and an accommodating regulatory environment.
The ERTP estimates the total cost of implementation at P20 billion over two-and-a-half years. With an anticipated budget deficit over the same period of P20 billion, the country is looking at a funding cost of approximately P40 billion.