AFCFTA: An opportunity for Botswana’s diversification drive

With African countries getting rid of trade barriers and forming one trade bloc, this spells more opportunities than challenges or vices for every member state. The African continent hosts the largest base of wealth, by wealth referring to natural resources, either tapped or untapped. We have over the past decades, been subject to criticism regarding how divided we are in Africa, hence our weakened voice at global level when it comes to trade negotiations and attracting inward investment. As representatives of Botswana’s private sector manufacturing and exporting businesses, we are excited about the AfCFTA and would anticipate the best looking forward from the agreement.

According to the 2019 African Economic Outlook report Africa’s general economic performance was indicated to be on the path to recovery and GDP growth was projected to be at 4.0 percent in 2019 and 4.1 percent in 2020. However, this was before the outbreak of the COVID-19 pandemic. The outbreak has only posed problems, as it has contracted Intra-African trade volumes and lead to the failure of numerous businesses across sectors. We believe the path to recovery, can only commence when the private sector is given the leading role through government facilitation.

As Botswana, we need to view the AfCFTA as a chance to realize our economic diversification goal. For many decades, Botswana’s exports were centered on primary products, especially diamonds, copper/nickel, meat and meat products, textile and clothing. In 2018 the mining sector contributed 90% total of exports, the figure till date treads along those numbers, such reflecting badly on national economic diversification goals. We ought to look more towards our import bill for opportunities, we are importing products that we can easily produce ourselves and export to the rest of Africa.

Looking at our 5 principal imports into Botswana we have food and beverages listed there, such is a cause for concern, we should not be failing to feed ourselves. According to a World Bank Report (2011), Africa earned 23% of its income from farming, a figure that continues to

rise. If this is matched with more electricity and irrigation, smart business and trade policies and dynamic private agribusiness sector that works side by side with governments to link farmers with consumers in an increasing urbanized Africa, the World Bank estimates that agriculture and agribusiness together could earn a US$1 trillion in Africa’s regional economy by 2030 from US$331 billion in 2010. The Botswana government should consider offering more support to farmers in this regard, acquisition of land for farming purposes should not be an onerous and cumbersome process, and efforts by the government should be channeled towards sustainable farming practices, considering channeling efforts towards the use of solar energy in agriculture. The AfCFTA will foster sharing of new technology amongst African countries, we should benchmark from member states who have successfully utilized such technology to ensure efficiency within the agri-business space.

The AfCFTA if approached tactfully could benefit Botswana. We could have more businesses being established and reduce the alarming employment rate. As an Association, we are ready to serve the manufacturing and exporting community, ensure that their business derive maximum utility from the continental Agreement. We would like to see Botswana becoming the manufacturing hub of Africa, it is not a lofty vision, and it will be possible through diligent private and public sector synergies.