26 Jul 2022

Members of Parliament (MPs) have unanimously supported the Bank of Botswana (Amendment) Bill of 2022.

Tabled by Minister of Finance Ms Peggy Serame on Monday July 25, the bill sought to amend the Bank of Botswana Act by, among other things, increasing the operational independence of the bank, authorised capital and penalties for flouting the bank procedures.

Supporting the bill, Francistown South MP, Mr Wynter Mmolotsi said it was necessary for the Bank of Botswana (BoB) to operate independent of government interference.

He said operational independence would enable the central bank to be guided by professionalism alone when making key decisions.

He also supported increasing the authorised capital from P25 million to P150 million. Mr Mmolotsi also supported the 12 months cooling off period proposed for governors leaving the central bank. 

The bill proposed a12-months payment to governors leaving the bank to prevent them from immediately joining other banks.

Mr Mmolotsi also supported the proposed increase in penalties for printing fake money from P1 million to P10 million. However, the legislator suggested an increase in jail sentence for the same offence.

He expressed concern about the president having powers to appoint the governor and deputy governor of the Bank of Botswana.

“You cannot talk about the independence of any institution of government when the president is the appointing authority of the leader of that institution,” said the Francistown South MP.

Mr Mmolotsi also called for a reduction in the P5 million requirement to start a bank business in Botswana in order to encourage citizens to start commercial banks. He said P5 million was too steep and unaffordable to most Batswana.

Tati East MP, Dr Douglas Letsholathebe also supported the bill and welcomed the proposal for the independence of BoB. 

He said monetary stability required a well resourced and independent central bank.

Dr Letsholathebe also welcomed the proposal to separate the governor and chairperson positions.

“It is really a good move to separate the governor position from the chairperson position of the bank. It will improve governance of the bank,” said the MP. Ghanzi South MP, Mr Motsamai Motsamai also spoke in support of the bill, saying the Bank of Botswana board should be appointed on merit instead of patronage or partisanship. 

He called for provision of banking services in rural areas. 

Ramotswa MP, Mr Lefoko Moagi called on the central bank to promote access to more finance by different sectors in the manufacturing industry to grow the economy. The 39-clause bill was passed by Parliament on Monday.

Thanking MPs for supporting the bill, Minister Serame said it was necessary to amend the Bank of Botswana Act because it was last amended in 1996. 

She said a lot of changes had occurred in the finance sector since that time. 

She said the separation of governor and chairperson positions were intended to promote transparency in the operations of the central bank. Ends