Connect with us

Business

Matsheka laments ‘unsustainable’ fiscal path

Published

on

Matsheka laments ‘unsustainable’ fiscal path

The Minister of Finance and Economic Development, Dr Thapelo Matsheka has poured scorn on the country’s fiscal path, calling it unsustainable.

When presenting the 2020/2021 Budget Speech earlier in the week, Matsheka noted that whereas the National Development Plan (NDP) 11 had environed a moderate cumulative budget surplus, the six-year Plan’s mid-term review anticipates cumulative deficits.

During the upcoming financial year, a budget deficit of P5.22 billion is projected, which amounts to 2.4 percent of the GDP.

The Minister noted the predicted deficit comes amid expected huge investments in economic infrastructure to support the transformation agenda.

Renowned economist and former Bank of Botswana Deputy Governor, Dr. Keith Jefferis agrees with Matsheka’s assessment that the fiscal path is not sustainable.

“He is right. For a long time, the government has been depending on diamonds for revenue and obviously the diamond sector is not growing,” reflected Jefferis, a Managing Director at Econsult, a local economic consultancy firm.

Matsheka laments ‘unsustainable’ fiscal path
NUMBERS MAN: Jefferis

Despite the tight fiscal position government finds itself in, Matsheka says his Ministry is determined to restore fiscal sustainability in the medium term to build budget surpluses in the last two years of NDP 11, which runs until 31 March 2023.

The Minister explained this is part of the effort to rebuild the country’s financial buffers, which he says were seriously eroded over the past few years.

“A number of initiatives will be undertaken on the revenue and expenditure sides, both in the short term and in the long term, in order to achieve the stated objectives,” he revealed.

Government revenues have recently been under pressure mainly due to the subdued diamond market and declining of Southern African Customs Union (SACU) receipts.

In view of this, and in order to boost revenue, Matsheka says government will adjust a number of fees and charges, some of which were last altered over a decade ago.

These adjustments will come into effect at the start of April and will subsequently be adjusted annually.

The taxman is also expected to enhance revenue collection and increase inspections on imported goods in order to curb non-compliance by importers at ports of entry.

Botswana Unified Revenue Services (BURS) has recently gone all out to lodge war against importers of grey import vehicles, predominantly sourced from Asia and the United Kingdom.

In the past, economists have advised that government should consider increasing tax rates in order to broaden its revenue base as well as including other forms of taxes such as the Financial Transactions Tax.

However, Matsheka this week ruled out any possibility of adjustments in tax rates or the introduction of any new taxes.

“While there is a scope to adjust tax rates, considering their levels relative to the region, priority would, in the interim, be on improving efficiency in the collection of existing taxes, rather than adjusting tax rates,” reiterated the Finance Minister.

Nevertheless, Jefferis feels in the long-term government will have no choice but to increase rates. However, he is confident the short-term solutions put in place, like adjusting fees and charges, will work for the moment.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Business

IDM’s Richard Malikongwa and Dr Onalenna Seitio-Kgokgwe receive top awards

Published

on

Richard Malikongwa, a seasoned Human Resource and Corporate guru who serves as IDM Regional Director and Chief Executive, was bestowed with the highest award of the Congress of “Chief Executive Officer with Human Resource Orientation”, while Botswana Country Director, Dr Onalenna Seitio-Kgokgwe received the Women Super Achiever Award.

Dr Seitio-Kgokgwe is also a recipient of the 2018/2019 Global CEO Africa’s Most Influential Women in Business and Government Awards.

The two Executives are commended for steering transformation at IDM and taking the Institution to higher levels as evidenced by amongst others; the Institute’s exponential growth and deliberate focus on people, since assuming their roles in 2016.

Chairperson of the Institute of Development Management, Governing Body and Director of Public Service Management Naledi Mosalakatane has commended the duo for the achievement.

Mosalakatane says IDM Board and Staff are proud of their sterling job of steering IDM to greater heights, further delivering excellent results.

According to the Founder of World Sustainability Congress, Dr R. Bhatia, the CEO with HR Orientation is the highest accolade which recognizes a Chief Executive in the global scene who employs the right combination of interventions to drive business performance, who is authentic and people oriented, and aligns his diverse teams to achieve solid business results on sustainable basis.

On the other hand, Women Super Achievers award is a reflection of professional achievement by women of the world who set a big example for transformation and change. The award celebrates the most respected and much sought-after Women Leaders in the industry who contribute immensely to the field of Women Platform, as well as nurturing talent, having trained several young people to grow in their profession.

The World HRD Congress is a global event which attracts thousands of international professionals from over 100 countries around the world.

Continue Reading

Business

Barclays completes Absa transition

Published

on

Barclays completes Absa transition

The start of the week saw Barclays Bank Botswana finally complete its transition to Absa Bank Botswana Limited.

The name change comes almost four years after main shareholder Barclays PLC announced it was ending its presence in Africa following 100 years in the continent.

Barclays PLC, a London based lender, was a 63.2 percent majority shareholder in Barclays Africa Group Limited (BAGL), which in turn operated in a number of African markets such as Botswana, South Africa, Kenya, Tanzania and Ghana.

Since the March 2016 announcement, Barclays PLC gradually reduced its controlling stake and has now become a minority shareholder.

In July 2018, Barclays changed its name back to Absa after the London bank sold the majority of its shares, which were primarily acquired by South Africa’s Public Investment Corporation.

The rebranding exercise was soon rolled out across the continent, with local operations starting their own rebranding late last year.

This came after local shareholders had in June 2019 approved changing the company’s name.

The bank also announced this week that it has obtained approval from the Companies and Intellectual Property Authority (CIPA) for the name change.

Despite the new look, the bank’s executives have stressed operations will continue as they did under the previous name.

According to the bank’s Public and Media Relations Manager, Spencer Moreri, the whole separation exercise for local operations cost a total of P16 million as of June 2019.

However, as the company is still on closed period, Moreri explained that the final amount spent will only be disclosed when Absa releases its financial results, which is expected to take place next month.

Continue Reading

Business

Living life through the lens

Published

on

Living life through the lense

BLURB: With the number of youth unemployment reaching dizzying heights, most young people fall through the cracks, choosing a life of drugs and alcohol abuse.

However for some young people in Francistown they’ve stayed true to the life is exactly old adage, when the going gets tough, the tough gets going.

A group of enterprising young men carrying cameras in and around Nswazwi Mall has been a source of intrigue in the second city.

Usually around 20 in number, the youthful entrepreneurs have found a niche, clicking away at their cameras to put food on the table.

Ranging between 18 and 24 in age, these proud Francistowners are tackling unemployment head-on.

Targeting predominantly young trendy people looking for ‘dope’ pictures for their social media accounts, the photographers grouped themselves and have been selling pictures at the mall since September last year.

A group of seven under the name of Kasi Eye Studio arrive at Nswazwi Mall at 7:30 every morning and dominate the area around KFC.

Their spokesperson is 21-year-old Jani Ookeditse, a self-taught photographer who, together with Terrence Basupile, 20, started the multimedia company.

“Initially it was just the two of us. We only had one camera but we managed to raise enough money to buy two more,” revealed Ookeditse, fondling his Canon with the same affection one might cradle a new born baby.

He explained he first came across the concept in the capital city, where he spotted other youth taking pictures in Gaborone Malls.

“I decided to start a similar thing in Francistown. I then partnered with Terrence, who already had a camera, and today there’s seven of us,” he said.

Charging P5 a pic, Ookeditse says business is booming although one challenge they face is over-demanding customers.

“Some customers want their photo shoots at places we’re not allowed to operate in. There’s restricted entry in the mall and security guards here don’t compromise!”

The determined entrepreneur further told Voice Money that the yet-to-be-registered company needs to be refinanced to acquire modern tools.

“We currently don’t even have tripods and we need those for our videos and better pictures.”

Competing for the same market at Nswazi Mall is an even bigger group under the banner Creative Minds.

This enterprise, made up of about 15 young people, consists of three small companies: Mabina Photography, The Great 441 and Family Life.

Speaking on behalf of Creative Minds, Augustus Phillimon explained that although these are three independent companies, they work together whenever the need arises.

“If it does happen that one of the companies receives a lot of bookings in one day, usually another company will step in if the contracted company doesn’t have the capacity to handle four bookings in a day,” said Phillimon, adding his company also offers videography.

Creative Minds’ main challenge is lack of operating space.

“We do have the equipment, but we need electricity to be able to use them. We are struggling with power and it has been a challenge to even recharge our camera batteries. Thanks to a few good Samaritans, who’ve allowed us to charge from their businesses,” he said.

Phillimon called on the authorities to help the youngsters by empowering them with the basic skills required to run a business.

“Most of them are self-taught photographers. They need re-skilling, either through workshops or short courses. I also urge big media companies and event organisers to engage them.”

According to Phillimon, when business is good each photographer can make up to P4, 200 a month whilst a quiet month normally amounts to P1, 400.

“Roughly each one of them makes P200 a day, or P50 on a really bad day,” he added.

Continue Reading
Advertisement
Advertisement


Trending