16 Dec 2021

Parliament has approved the authorisation of a P1.57 billion government loan application from African Development Bank (AfDB).

The loan proposal, which is referred to as the economic recovery support programme, (African Development Bank (AfDB) Loan Authorisation Bill, Number 31 of 2021, was adopted by a vote of 40 MPs with all its clauses and without any amendments.

The purpose of the loan is summarised under four broad objectives of assisting to finance the 2021/2022 budget deficit and improve fiscal efficiency and sustainability.

The bill is also supportive of private sector-led agriculture, tourism and industrial sector transformation as well as enhancing economic and social inclusion.

The requested loan will still leave the country’s external debt exposure within the statutory limit of 20 per cent of GDP.

At the end of September, the ratio of external debt and guarantees to GDP stood at 9.9 per cent while domestic debt and guarantees stood at 11.7 per cent of GDP, all within the 40 per cent of total debt to GDP statutory limit.

Lobatse MP, Dr Thapelo Matsheka spoke in support of the bill .

He said it was pleasing to note that the proposed loan would partly be channeled towards implementing the economic recovery support programme, adding that government had developed the economic recovery and transformation plan (ERTP) to support the restoration of economic activity and incomes as well as to facilitate economic growth.

Ngami MP, Mr Caterpillar Hikuama cautioned that poor implementation of government programmes and projects continued to be a challenge with projects experiencing cost overruns and delayed completion which resulted in overspending.

He therefore said government needed to commit to strengthening project management structures.

Mr Hikuama also pleaded with government to guard against institutionalised corruption, particularly during the tendering process.

He said corruption in the awarding of tenders continued to milk government coffers.

Francistown West MP, Mr Ignatius Moswaane argued that the benefits of Botswana’s post-independence economic growth had not trickled down to the masses, particularly in Francistown.

He added that it had led to a situation that could be classified as growth with uneven development.

He expressed displeasure at what he termed uneven pace and distribution of developments across regions, saying it created regional disparities.

Mr Moswaane said it was disturbing that project implementation in certain regions was done adequately while in others it moved at a snail’s pace.

He said the proposed loan should therefore be channeled towards upgrading the city of Francistown since it lagged behind in developments.

Mahalapye West legislator, Mr David Tshere called for prudent spending.

He also said it was disturbing that government continued to overspend on settling lawsuits which were easily avoidable.

Molepolole North MP, Mr Oabile Regoeng said it was important for government to apply for the loan since its revenue generation streams had been negatively affected by the COVID-19 pandemic.

He said Botswana, like many countries, was adversely affected by the pandemic, which shone a spotlight on a range of existing socio-economic challenges in the country .

He said it was important to approve the loan application particularly that the loan was intended to finance the country’s economic recovery. ENDS