16 Dec 2021

Botswana has a good track record of using loans secured from financiers prudently for the general development of the country.

Contributing to the debate on the bill seeking parliament’s authorisation to secure a loan from the African Development Bank (AfDB) to cover the 2021/22 budget deficit as well as to finance the economic recovery support programme, Shashe West Member of Parliament, Mr Fidelis Molao said he was confident that the loan would similarly be used to drive the country’s development agenda.

Mr Molao noted that it was not unheard of for countries to experience deficits every now and then, and explained that loans were one way of ensuring that the delivery of developments continued undisrupted.

He dismissed the assertion by some MPs that the loans Botswana was securing would burden future generations, indicating that avoiding borrowing would on the contrary burden today’s generation as government would have to resort to hiking taxes to offset the budget deficit.

Also lending his support to the bill, Mogoditshane Member of Parliament, Mr Tumiso Rakgare said that the loan would permit the country to implement certain key developmental projects.

Likening the country to a household, Mr Rakgare said there was nothing wrong with Botswana resolving to seek a loan in the face of a budget deficit.

The legislator pointed out that agriculture was among the sectors that would benefit from the loan, and expressed optimism that the loan would help drive the transformation of the sector.

Serowe North MP, Mr Baratiwa Mathoothe also supported the bill, noting that the loan would help finance the implementation of critical projects that had been set aside due to lack of funding.

He said after securing the loan, priority should be supporting sectors capable of generating revenue for the country.

That, he said, would help the country break the cycle of reliance on loans.

In addition, Mr Mathoothe called for the adequate collection of taxes, saying despite the importance of this revenue generation stream, it was sad to note that some companies continued to evade tax.

Mmadinare lawmaker, Mr Molebatsi Molebatsi said the fight against COVID-19 had impacted government coffers negatively hence the need to source the loan.

Mr Molebatsi said the loan would go towards infrastructure development, which he said was on its own critical for attracting foreign direct investment (FDI).

He said digitisation was also key and argued that part of the loan should go towards that.

He noted that for economies to grow and transform, it was necessary that they embraced digitisation.

Francistown South MP, Mr Wynter Mmolotsi who also supported the bill, cautioned against unchecked borrowing, saying it would create a burden for future generations, especially since the country’s existing revenue generating streams such as mining were performing poorly.

Advising against borrowing for things that the country could do without, Mr Mmolotsi urged government to ensure that the loan in question would go towards critical projects and not be used to enable the country to simply get by.

He said with Botswana’s economy performing badly, it was imprudent for the country to be seeking loans each year. ENDS