09 Apr 2013

The Minister of Finance and Development Planning, Mr Kenneth Matambo says there is a need for the nation to substantially increase productivity of its capital and labour as well as the competitiveness of its products in the global market in order to realise desirable economic growth.

When presenting the draft mid-term review of the National Development Plan (NDP 10) in Parliament on April 8, Mr Matambo pointed out that it was necessary to develop domestic capacity to manage economic shocks, especially those that are of a global dimension.

“Factors to consider in this regard include implementation of high economic impact projects that have high economic returns. These can be achieved through rigorous economic appraisal of programmes and projects to ensure that only projects with the highest economic returns are selected,” he stated.

That, together with prudent management of the national budget, he said could assist the nation to enhance its capacity to manage global economic shocks.

However, the minister observed that the assessment of resource availability during the first half of the plan had revealed that the situation had turned out to be much better than had been envisaged at the commencement of the plan.

He noted that while the plan had projected total government revenues to be P73.5 billion during the first half of the plan, the figures turned out to be P100.4 billion.

He said total government spending had turned out to be P116.6 billion instead of the projected P105.8 billion.

“The actual cumulative budget deficit for the first three years therefore stood at P16.2 billion instead of the projected P28.7 billion,” he added.

Minister Matambo also indicated that the second half of NDP 10 would seek to address unemployment, particularly of the youth whilst aimed at ensuring that those who were assisted through poverty eradication programmes graduated from such and were adequately endowed with life skills.

That, he noted, would help ensure attainment of the Vision 2016 objective of prosperity for all.

For the remaining phase of NDP 10, the minister emphasised the need for the country to effectively use and optimally deploy its production inputs to foster high economic growth rates.

In addition, the minister said macro-economic stability, achieved through variables such as competitive exchange rates and contained inflation rates, could play a major role in economic growth.

He stated that to achieve macro-economic stability, government would continue to pursue a sound macro-economic management with anti-inflationary monetary policy and fiscal discipline to create a conducive environment for a thriving private sector investment.

Furthermore, Mr Matambo said it had been realised that though Botswana was ranked highly on issues of governance, the country remained alert of the fact that corruption and excessive red-tape could add to increased investment costs, which could in turn hamper economic growth. ENDS