I recognise that the Government’s main focus, naturally, is on the De Beers deal in the wake of Anglo American’s move to dispose of its diamond business. It is not difficult to understand why; De Beers has carried Botswana to where it is now, sixty years since Independence. So it is not surprising that Anglo’s search for a buyer of De Beers would attract keen interest from the Government of Botswana.
But my purpose is not to dwell on the De Beers sale. The bigger point, though, is to urge policymakers, as they pursue the De Beers deal in whatever form, not to lose sight of other sectors of the economy, especially the informal sector. Due to the dearth of formal job opportunities, the informal sector has become a source of livelihoods for thousands of people nowadays. That said, it is a sector characterised by low returns or yields, long hours and low productivity. It is also a sector in which the majority of players have few skills. It is therefore important to pay attention to the sector to upgrade it and lift more people out of poverty.
It is also true that our traditional sectors, such as mining and manufacturing, are not going to help lift as many people out of poverty. So the sooner we recognise that the mining, manufacturing, and even commercial agriculture sectors are not going to absorb the large armies of unemployed youth who roam the streets, the better. This therefore calls upon us to help the informal sector improve productivity in the services it already offers, where it is.
Subsistence agriculture too is notoriously bedevilled by low productivity due to poor absorption of technology and lack of mechanisation.
Several considerations need to be taken into account. In dealing with the informal sector, we need to be diligent. We should approach them with light-touch regulation. We should not burden them with high minimum wages, which, as employers in their own right, they cannot afford. It makes sense to exempt them from some of the onerous provisions of our employment code. The law that commenced at the beginning of this month, for instance, extends its coverage to all sectors of the economy, including the informal sector. Persisting with this would be an unnecessary blunder. It also makes no sense to extend the burden to the informal sector when it is obvious that many of them will not comply with the law’s provisions. Why turn them into unwitting violators of the law?
One District Council in the greater Gaborone area is reportedly engaged in running battles with street vendors because their activities contravene the Public Health Act. This shows how difficult enforcement already is. However, food handlers must abide by existing laws to mitigate outbreaks of disease and other public safety concerns. While it is important to enforce this, it also helps to be smart and provide appropriate infrastructure for vendors at a fee, because another problem with our public policy is trying to provide services for free, which then leads to sustainability issues.
So it is important that, going forward, services be provided at their full cost to balance the interests of consumers with the ambitions of the informal sector.