The 4-year Private Sector Development Strategy (PSDS) which was launched by Business Botswana is estimated to cost more than 74.7 million (USD 5.5 million) over a four-year period.
This is contained in document titled ‘Private Sector Development Strategy (PSDS).’
The document reveals that funding allocation for the PSDS will be phased
With (33%) expected to be taken by Pillar four of the project which focusses on increasing production capacity, followed by Pillar three (mainstreaming the informal sector, 32%) and Pillar one (diversifying the economy, 16%). The remaining pillars two (Diversifying export basket, 13%) and five (Private sector leadership, 5.4%) have lower allocations because they benefit from developments made in the other three pillars. The document shows that a budget reserve of 10% of the total budget per year for project management has been added to the assumptions for reasons of prudence. The project is expected to be periodically monitored (for progress and alignment) and audited in the final phase; at a cost of 1.5% of the estimated budget. The document recommends that there should be a stand-alone secretariat entity headed by a coordinator responsible for coordination, management, and implementation of the project. The Secretariat’s role and mandate is the coordination the PSDS activities, resource mobilization, information dissemination and monitoring and evaluation. The coordinator will report to the Chief Executive Officer of Business Botswana (BB).
The Secretariat as the coordinating entity will work with assigned Sector Specific Technical Committees nominated from Associations affiliated to Business Botswana. Despite having developed the first private sector development strategy in 2008 which called on private sector to lead national economic development, the private sector in Botswana has continued to play a peripheral role in the economy and its contribution to gross investment has remained low. It says the public sector comprised of government ministries, local government , parastatals and state-owned enterprises, continues to dominate investment and economic activities such as mining, minerals processing, beef processing, energy production, telecommunications, provision of training services and finance provision. The document acknowledges that the road to a private sector led economy has not been smooth. It attributes this to among others; financial resources which have not been easily accessible for private sector to lead, policies and regulations which have not fully supported foreign and domestic investment and the doing business environment has not transformed enough to stimulate the local and foreign investment. The document notes that the government has not significantly reduced its direct involvement in economic operations and has been slow in implementing privatization, liberalization and Private-Public Partnerships (PPP) and private sector development initiatives have not been inclusive enough to accommodate the informal sector micro and small enterprises.
“ Private sector players have not been capacitated enough to identify and take up opportunities and mindsets have not changed in both private and public sectors to embrace and facilitate a diversified, private sector led economy,” says the document.
It says faced with the above challenges; the private sector remains a distant follower to the public sector in the economic development investment.
Therefore, this calls for a clearly focused strategy and programs which will disrupt current mindsets and systems towards promoting private sector investment and leadership, which will lead to economic diversification, productivity growth, import substitution, competitiveness growth, and foreign market penetration.
