Experts urge government to review

Now is the time for government to review subsidies and improve tax collection to boost revenue as the country grapples with a dwindling revenue base and youth unemployment. Experts at the University of Botswana (UB) Budget Dialogue reasoned that subsidies are not reaching intended beneficiaries, resulting in revenue losses. They warned that increasing the debt ceiling could lead to higher interest rates, while advocating for investment in the creative sector to drive job creation and economic growth.

UB academic, Dr Jonah Tlhalefang pointed out that existing subsidies were missing the intended beneficiaries, hence should be reviewed to ensure targeted beneficiaries benefitted. Taking the electricity subsidy as an instance, Dr Tlhalefang said it was intended to enable the poor access to electricity, but the underprivileged were not necessarily connected. He said the subsidies were only serving as a revenue loss to the economy, and reviewing them could save government money.

Also, to increase revenue mix, the government should ensure efficiency in tax collection as well as reduce tax expenditure. With regard to increasing the country’s debt ceiling, Dr Tlhalefang said, “adjusting the debt ceiling upwards is not a good thing, it is a surprise to the market. Such a move could lead to high interest rates, increasing the cost of borrowing.” Before an increase, there is a need to address how the country reached the 40 per cent debt ceiling, and if the debt is under 60 per cent of the country’s GDP, it would be prudent to increase the ceiling with caution, Dr Tlhalefang said.

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The Department of Visual and Performing Arts’, Professor Connie Rapoo, said the country was wrestling with the crisis of youth unemployment, and that the creative sector offered employment opportunities. “And I want to say very confidently and broadly that the creative industry sector creates jobs better than any other economic industry,” she said, adding that there were several industries within the sector. Therefore, intentional investment and policy framework in the sector could help reduce the burden of unemployment.

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