Experts push for economic diversification
In a race against rising unemployment and a faltering diamond market, Botswana finds itself at a crossroads.
As the diamond sector continues to grapple with a weak demand and costly mining challenges, a panel of experts at a thought provoking Local Enterprise Authority (LEA) roundtable discussion during the Global Entrepreneurship Week celebrations on Thursday, sounded the alarm to break away from dependency on precious stones and re-imagine the economy.
The message from all the speakers was loud and clear; The country must diversify, especially into areas of manufacturing, creative sector and value chain development which possess enormous potential to unlock employment opportunities.
“Botswana needs to be industrialised and to export more of its home grown products. We should not be talking about unemployment, its absurd, we need entrepreneurs to run the country not employees. We have business minded people, that’s why our policy framework is moulded around that ,”Said entrepreneur and director of Earth Vitamins Foods Thabo Molefe.
According to the available statistics almost 250,000 people are unemployed in Botswana-a number which has kept going up in the past years.
“Unemployment is structural more so that our economy is dependent on a capital intensive sector which is contributing to the GDP. That is why we have to diversify to areas such as manufacturing and creative sector. This are areas which we should take advantage of due to their potential for growth. You can only reduce unemployment by creating more jobs ,of course we always here that diamonds are not forever so sectors such as manufacturing and tourism can be nurtured for economic growth,” added head of human and social development unit at Botswana Institute for Development Policy Analysis Dr David Mmopelwa.
According to the available statistics CEDA has so far disbursed P7.2 billion to 23,000 clients in its 23 years existence while FAP spent P800 million to finance businesses in its 20 years of operation.
“The problem is limited access to finance not lack of finance. Our commercial guys are risk averse and their interest rates are high .Though government has its programmes like YDF,CEDA and NDB we are unfortunate since we have few venture capitalists .We need people coming into the market to assist our entrepreneurship development and assisting our people in terms of either partnership or providing finances. Our people fear partnerships to grow businesses or to sell equity. Even foreigners can partner them because our market is limited as Botswana, “said LEA acting chief operations officer Fana Kelebogile
Director-Economic Empowerment at the Ministry of Entrepreneurship Ronnie Phuthego emphasised that businesses are struggling in areas of access to market and accessibility of affordable funding. “As a ministry our job is to create conducive environment for entrepreneurs to thrive. So the aim is to provide a cushion environment to support startups and coming with policies and framework to give support to new ventures,” he said emphasising the need to move away from reliance on government for funding and striving to attract investors to finances new ventures and those already in existence.
Reflecting on the history of Entrepreneurship in Botswana, Entrepreneurship lecturer at the University of Botswana Dr Gaofetoge Ganamotse said the challenge is that many people started businesses on a shallow entrepreneurship background.
“We did look at how businesses were formed and most people did not have any information on the type of a mindset they should have as entrepreneurs. So we had few people who succeeded. In terms of developing entrepreneurs from classroom we didn’t have entrepreneurship teaching ,it was only taken as a module for business studies students. Even up to now we don’t have many schools providing entrepreneurship as a programme on its own. This is what is failing us since we don’t have a foundation for entrepreneurs but for only business start ups,” she said.
