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Local economy can’t create 2000 jobs a year

Public Service salaries suffocate developments

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BAME PIET

Despite numerous initiatives put in place, the economy is struggling to create 2000 formal jobs a year and the trend started five years ago, and in some instances there was zero growth in job creation.

This is far below the approximately 20,000 graduates who enter the job market every year.

According to the National Development Plan 11 Mid Term Review draft document, job creation has been a challenge for a while.

“The growth rate of formal employment has been disappointing in recent years, with several years when growth has been barely above zero, and one year of negative growth following closure of the BCL mine. Over the five years from 2013 to 2018, the average annual growth rate of formal employment rate was less than 0.5 per cent a year,” says the draft document which was shared with the public last week. 

However, the informal sector seems to be growing especially with the introduction of short term government interventions such as the Ipelegeng programme, household employment and subsistence farming.

The government has attributed the slow growth in formal employment to a sharp reduction of work permits for foreign investors and workers.

“This reflects the close positive relationship between immigration of workers with necessary skills and job creation for Batswana, and supports the long standing claim by the private sector that unduly restricting immigration has adverse implications for the economy and for jobs,” reads the document.

Meanwhile, it has also been established that salaries for civil servants are competing with development funding and that the latter is losing.

Initially, NDP 11 had projected a P122.1 billion expenditure on civil servants salaries but the figure has gone up to P150.5 billion due to public sector salaries increase.

“There are also large increases in grants and subventions (transfers to parastatals and local authorities, student bursaries). In order to contain total spending, this is offset to some projected development spending. The original NDP 11 development programme totalled P101.4 billion, this has now been cut P81.9 billion. Essentially, lower development spending is the price that has to be paid for higher public sector salaries,” the draft document says.

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Business

Passion for info tech

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MARS MOBILE CAUSING A STIR ON EARTH

Though there are still challenges for the information technology industry, a former Botho University star student is aware that passion knows no obstacles.

His company Mars Mobile is proof of that.

Recently almost everybody has been singing from the ICT hymnbook with the President HE Dr Mokgweetsi Masisi leading the choir.

However, 35-year-old Steven Retshabile’s passion dates back to way before the sector became ‘trendy’.

The Maun native’s enthusiasm for technology and technological solutions led him to study for a Bachelor of Sciences in Computing, specialising in Software Engineering.

“Technology is taking over and is changing our lives and how we do things. I want to be one of those who shape the direction of things,” he explains assuredly.

After completing his studies in 2016, Retshabile sought to improve access to information, reduce cost of advertising and save the environment by reducing the need for paper.

And thus Mars Mobile was born.

The company develops applications and websites, designs graphics, animations, games, commercials and edits videos.

Mars Mobile has already launched an advertising application available on android 5.0 or later versions.

Retshabile says this app gives Batswana a chance to sell their products outside the country and provides information about available products and services via mobile devices.

Now with over 2, 000 subscribers across the country, the company’s first application was developed in 2018 and launched at the Northern Trade Fair the same year.

It has been exhibited at other shows like the Global Trade Fair last year, with Retshabile describing the response as overwhelming.

Customers who can use the application to put their information in the virtual world include corporate companies, smmes and individuals.

Unfortunately, not everyone is able to use information technologies due to the costs associated with access.

Most people access social sites like Facebook and Whatsapp because they are on cheaper data packages.

MARS MOBILE BOSS: Retshabile

“Tech adoption is also slow with some still using old versions of platforms while we are on version 9. This affects progress because in this business we need numbers,” notes Retshabile.

Another challenge Retshabile faces is startup capital, which he is having trouble securing.

Despite these obstacles, Mars Mobile is forging boldly ahead.

They have already approached network providers in a bid to get their app under the cheaper data packages so the app can be accessed by all.

They have also embarked on an outreach programme, which they use to educate the nation through exposes, radio shows and road shows.

It may be tough but Retshabile says they are going global soon.

“In five years we will be global and selling Botswana artifacts and other products to the rest of the world. By then we will have a staff compliment of about 100 highly skilled people. We would also have integrated functionality into our existing apps and hosting in our own data center,” he states.

He further reveals that they have just completed World Tourism Experiences Shared in Harmony (WOTESH), a social media based application designed for sharing tourism experiences and for bookings.

For that, they have instant private chat for consumers and business.

Retshabile’s simple advice for those wishing to go into business, particularly this type, is to keep the passion burning.

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Business

Youth unemployment rises to over 20 percent

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Statistics Botswana (SB) estimates youth unemployment to stand at 20.7 percent during the third quarter of 2019.

This makes a staggering 3.1 percent increase from the 17.6 percent recorded in the year’s second quarter.

The estimates, taken from SB’s quarterly Multi-Topic Survey, only relates to individuals who were actively seeking work during the referenced period.

The figure rises up when those who are discouraged from seeking jobs are included, with the rate estimated at 26.1 percent.

Discouraged or relaxed job seekers in this context are those who did not work in the reference period and are available to work but were not actively seeking employment.

The results of the 2019/20 Botswana Quarterly Multi Topic Survey (BQMTS), estimated the total ‘actively seeking employment but currently unemployed’ population at 194,990 while for the discouraged stood at 68, 654.

According to the results of the survey, the age group most affected by unemployment is those between the ages of 25-29 accounting for 20.2 percent, closely followed by those between the ages of 20-24 at 18.9 percent.

The third most affected age group is those who are between the ages of 30-35 at 15.7 percent.

By qualifications, the results of the survey indicate that Secondary Education holders dominated the currently unemployed with 56.9 percent followed by Primary School holders and University Graduates with 12.7 percent and 9.6 percent respectively.

Furthermore, the number of individuals who reported being under-employed (those who earn less than they are qualified for) stood at 62, 940, representing three percent of the total currently employed population of 800, 000.

Of the total number of those who indicated to be under-employed, 71.1 percent are reportedly females while 28.3 percent are males.

Under-employment is reportedly also more prevalent amongst persons who completed secondary and primary school.

Presenting the results of the survey on Tuesday this week, Director Social and Demographic Statistics, Tapologo Baakile described the rising unemployment figures as ‘worrying’.

Baakile said the rate of youth who are neither in education, employment or training, ‘or who are basically doing nothing’ stood at 35 percent.

“Unemployment is a serious concern because we have more youth doing nothing because some of them do not even actively seek employment,” said Baakile.

In terms of remuneration, it has been found that foreign workers earn more than their local counterparts.

Average earnings for citizens were estimated at P5, 117 while non citizens averaged P12, 794.

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Business

BSE turnover down

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2.8% drop attributed to Choppies suspension and Wilderness and Furnmart delisting

The continued suspension of Choppies from trading its shares on the Botswana Stock Exchange Limited (BSEL) together with the delisting of Wilderness Safaris and Furnmart have contributed to reduced levels of turnover at the stock market.

This is according to the BSE market report for 2019.

During the year, turnover levels at the stock market went down by 2.8 percent, dropping from P4.4 billion to 4.2 billion.

The suspension of Choppies – implemented in November 2018 – as well as the delisting of the other two companies are said to be major contributing factors to the slight decline.

These three entities reportedly contributed significantly to the market in prior years due to their sizes and contribution to diversity of sectors on the exchange.

Their departure and suspension have dealt a heavy blow to the stock market and have in addition negatively impacted domestic market capitalization, which has reduced by P3.7 billion to P38.7 billion from P42.4 billion recorded in 2018.

By comparison, domestic companies have been observed to be the most traded counters relative to foreign companies, having contributed 97.8 percent to the total equity turnover on the stock market in 2019.

Still on the domestic board, the property sector was the most traded, followed by the retail and wholesaling sector with contributions of 28 percent and 23 percent to domestic turnover respectively last year.

According to the market performance report, the foreign mining sector remains the largest in value and most illiquid.

Anglo American, a diverse mining conglomerate which owns an 85 percent stake in De Beers group,is the only mining company that contributes significantly to this sector.

The mining giant,which is also listed on the Johannesburg and London Stock Exchanges, accounted for 93.2 percent of foreign equity market capitalization and for 84.3 percent of the total market equity capitalization.

By way of investor contribution, local institutional investors are reported to have dominated trading activity in 2019, accounting for 56.7 percent of the total equity turnover while foreign institutional investors accounted for 32.1 percent.

It is reported that in 2019, local institutional investors and local individuals were the net sellers of equity while foreign companies were net buyers.

This is regarded as a sign of improved outlook into the domestic equity market relative to peer frontier markets.

The market has also seen an improved number of local individual investors, with the number increasing from 4.5 percent to 9.9 percent between 2018 and 2019.

These individuals have in monetary terms, seen their trades result in P178.5 million in turnover in 2019, an substantial increase from P83.8 million registered in 2018.

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