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We need investors...but are we ready?

Publishing Date : 30 October, 2018

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The latest Global Competitiveness Report has given a hint on what we need to do as a country to become a competitive economy. Perhaps, the report should be treated as a diagnosis and prognosis that will serve as blueprint for Botswana’s economic transformation.

For years, we have been telling investors to come and open shop in Botswana, and surely we have not succeeded in doing so. There are of course obvious difficulties that foreigners faced in the last 10 years so, like obtaining VISAs as well as work permits and other uncertainties created by the political climate of that time.

With that seemingly resolved by the new administration, the major stumbling block remains the reality of the competitiveness of our economy. The Global Competitiveness Reports underscores that infrastructure is the most fundamental of all enablers in a competitive economy. It is no longer enough, or it has never been enough to tell foreign based companies to come and invest in Botswana because it is “politically stable and peaceful…” Investors what to go to a country where they would be able to carry business efficiently and still make profit.

But the reality of the matter, owing to the current state of our roads, railway, airports as well as water, power and internet, Botswana has not reached the level that would entice the investors. Surely our cities, Gaborone and Francistown in particular need a serious revamp and building of modern infrastructure which will give Botswana a competitive advantage when it comes to doing business.

We already have a deficiency of a small population, but with smart partnership with neighbouring countries such as South Africa, Zimbabwe, Zambia as well as Namibia, we can compensate for that and increase the scope of our market. But this will took come and a heavy prices, government will have to build the necessary infrastructure that will link Botswana with the neighbouring countries.

The Global Competitiveness Report contended that extensive and efficient infrastructure is critical for ensuring the effective functioning of the economy. This include effective modes of transport—including high-quality roads, railroads, ports, and air transport— which enable entrepreneurs to get their goods and services to market in a secure and timely manner and facilitate the movement of workers to the most suitable jobs.

There was a World Bank report few years ago which warned Africa as a whole will go into a recession in the next 10 years if does not improve the state of its infrastructure. This is because, corporates are not willing to invest in countries where doing business will be difficult or expensive. Another reason will obviously because these firms are from countries which are already established with competitive economies, therefore expect the same in foreign lands. 

Economies also depend on electricity supplies that are free from interruptions and shortages so that businesses and factories can work unimpeded. This has not been the case in Botswana. Have gone through a disturbing phase in the last 5 years or so, though the situation has improved recently.

The report also contended that a solid and extensive telecommunications network allows for a rapid and free flow of information, which increases overall economic efficiency by helping to ensure businesses can communicate and decisions are made by economic actors taking into account all available relevant information.

Notwithstanding the fact that many people now owns mobile phones, and the penetration level is high, internet remains expensive and a luxury in this country. We are still struggling to make proper investment in this areas which will allow business to operate at their best. Internet is key in todays’ business world, it is not even debatable.

The competitiveness report indicated in one of its pillar that technological readiness, the agility with which an economy adopts existing technologies to enhance the productivity of its industries, with specific emphasis on its capacity to fully leverage information and communication technologies (ICTs) in daily activities remain a key factor in today’s economy.

Whether the technology used has or has not been developed within national borders is irrelevant for its ability to enhance productivity. The central point is that the firms operating in the country need to have access to advanced products and blueprints and the ability to absorb and use them. Among the main sources of foreign technology, foreign direct investment (FDI) often plays a key role, especially for countries at a less advanced stage of technological development



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