Private Sector Urged To Invest In Domestic Economy
Isaac Pinielo | Monday April 11, 2016 15:12
Minister of Finance and Development Planning, Kenneth Matambo made the call at a high level national symposium on sustainable finance that was held in Gaborone last week.
He said the private sector as a potential source of capital, comprises of pension funds, insurance funds, private equities, private foundations and capital markets.
“Such sources will need to be harnessed in order to advance the objectives of the post-2015 sustainability agenda,” he said.
He noted that it is critical that the potential sources of financial resources should be taken into account as an integral part of the design and implementation of the strategy for financing economic growth and development in Botswana.
As part of the strategy for engaging private sector in the development planning processes, Matambo said government has adopted a Public Private Partnership (PPP) approach, which he said has the potential to promote growth of local businesses and reduce financial burden on government.
“It is also one of the measures of sharing costs, promoting strategic partnerships, and regional collaboration on investment, particularly in infrastructure development,” he said.
In addition, he said government continued to promote foreign direct investment which is necessary for economic diversification and employment creation by doing all it can to improve on constraints to doing business in Botswana.
The minister further emphasised that investment financing is the responsibility of both the public and private sector. He added that government continues to promote a conducive micro and macroeconomic environment as an overarching strategy for economic growth.
He said the private sector should step up and promote access to financial services for both individuals and businesses to help reduce challenges of unemployment, poverty and income inequality that the nation is facing.
“In so doing, financial inclusion should be the main emphasis as it is critical for sustainable growth and development,” he said. He added that an inclusive financial system has potential to benefit a significant number of households by improving access to financial services, thus contributing to objectives of poverty reduction.
According to Matambo, for government to implement its national priorities, a sizeable budget for development expenditure is planned for the national development plan (NDP) 11 .
He said the bulk of the expenditure will go towards construction of different types of infrastructure including water and energy infrastructure, schools and health facilities, roads and bridges, as well as irrigation facilities, among others.
This, he said, is because government has identified investment, particularly in infrastructure, as a key element in promoting private sector involvement in the growth of the domestic economy, especially industrial development.
In addition, the minister said government continued to maintain a stable macroeconomic evironment by ensuring coordination between fiscal, monetary and exchange rate policies.
“The expectation is that the private sector will equally take advantage of the conducive macroeconomic environment, to establish sustainable businesses to create employment opportunities,” said Matambo.
He also mentioned that despite government’s efforts to provide financial resources for sustainable development in the country, these resources have been limited given the recent global financial crisis and the weak recovery of the global economy. He said this has resulted in some important projects not being undertaken.