Govt Announces “Chema Chema Fund” With P200 Million Capital Injection
As the informal sector continues to play a pivotal role in the local economy, government has seen it fit to extend a helping hand with a creation of a revolving fund dubbed “Chema Chema Fund”
Presenting the 2024/25 budget speech at Parliament buildings on Monday, Minister of Finance Peggy Serame said the fund will start with an initial capital injection of P200 million.
“We believe there is great potential for the informal sector to play a more meaningful role in overall economic development and job creation. This new fund is aimed at fundamentally transforming the informal sector and creating more employment opportunities,”said Serame.
Preliminary data by Statistics Botswana has indicated that informal sector contributed 3.2 percent to economic growth in 2023. Statistics Botswana’s (2018) Botswana Multi-Topic Household Survey Report 2015/16 indicates that the total number of informal businesses in Botswana was 105,445, 55.5 percent of which were in household headed by males while 44.5 percent in households headed by females.
Most of the businesses 49,946 (47.4 percent) were in the wholesale & retail trade industry, followed by manufacturing with 14.8 percent and real estate with 11.0 percent. Informal sector activities tend to be more concentrated in urban villages and cities and towns recording 48.8 percent and 26.7 percent respectively. The total estimated number of persons employed in the informal sector was pegged at 191,176.
In addition, the 2019 informal sector strategy will be reviewed and implemented during the next financial year and it will consider how government can facilitate the provision of decent places of operation for informal businesses, provide capacity building that is essential for skills enhancement, improve market access and find ways to incorporate the sector into the mainstream economy.
Further,the government will establish an intellectual property Motshelo scheme and Intellectual property ideas incubation centre to support indigenous reserves and innovation.
“In addition, the budget recognises agriculture as one of the critical sectors in our economy because of the business and export potential it promises as well as its centrality to livelihoods. Therefore, to diversify the economy and create sustainable jobs we must strive to make agriculture more productive and appealing to the youth,” said Serame encouraging all aspiring entrepreneurs, innovators to take advantage of the new fund.