TRALAC - Trade Law Centre

Botswana: Government wants to reduce import bill

Sunday, 19 September 2010

Source: The Botswana Gazette

In an effort to encourage the purchase of locally produced goods and services, government has spent P 106 million.

This was revealed by the Assistant Minister of Trade and Industry, Maxwell Motowane at Botswana Export Manufacturing Association (BEMA) Annual General Meeting (AGM) held last week.

Motowane said that this is a modest progress made by government to try and reduce the amount of imported goods and services. “The private sector, BEMA members in particular, must play a role to assist the fulfillment of the Economic Diversification Drive (EDD) objectives” he said. The EDD was launched last week by the Ministry of Trade.

Motowane said the purchasing power within the private sector across various industries is yet to be determined and quantified. He said his Ministry will coordinate progress made by individual ministries and parastatals on EDD initiatives.

The EDD will achieve this by promoting targeted local procurement arrangements and blacklisting of companies which, after being awarded tenders choose to import, he said. Motowane said in the medium to long term, the objective of the government is to wean off the private sector from the government support and protection so that they can compete openly in both the domestic and global economy.

Motowane said that Botswana as a beneficiary of the African Growth Opportunity Act (AGOA) has failed to penetrate US markets. “It is disappointing to see that through so many efforts which were put to promote the US market under AGOA, today Botswana has very little exports going into that market. He challenged BEDIA and BEMA to join hands and establish exactly what needs to be done.

Meanwhile the Deputy Permanent Secretary in the Ministry of Trade and Industry, Boniface Mphetlhe said that EDDs are premised on the fact that government has a huge import bill, which is at P15 billion.

He said Botswana is a “small market but second largest consumer in the region hence the call to leverage government’s e enormous purchasing power to diversify the economy by deliberately promoting the utilization of locally manufactured goods and services through procurement.”

He said there is need to grow local industry to build competitive industry, which will meet the local demand.

Government, parastatals and private sector continue to buy imported goods and services despite some programmes that we have in place such as; the local procurement programme and reservation preferential treatment provision for citizen companies under construction industry and ICT.