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Bank of Botswana cuts the bank rate to 5 percent

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Bank of Botswana’s Monetary Policy Committee has on Tuesday this week reduced the bank rate from 5.5 percent to 5 percent. In a statement from the Committee late yesterday (Tuesday) reads, “the current state of the economy, both the domestic and external economic outlook as well as the inflation forecast, provides scope for easing monetary policy to support economic activity without undermining maintenance of inflation within the Bank’s medium-term objective range of 3 – 6 percent.”

The Committee therefore, urged all commercial banks to make the necessary interest rate adjustments with immediate effect to reflect this policy decision. It further indicates that, the outlook for price stability remains positive as inflation is forecast to be within the 3 – 6 percent objective range in the medium term. Meanwhile, inflation decreased from 3.4 percent in August to 3.2 percent in September 2017. Subdued domestic demand pressures and the modest increase in foreign prices contribute to the positive inflation outlook in the medium term.

This outlook is subject to downside risks emanating from sluggish global economic activity and the resultant low commodity prices. Conversely, any substantial unanticipated upward adjustment in administered prices and government levies and/or taxes and any increase in international commodity prices beyond current forecasts present upside risks to the inflation outlook. GDP in Botswana grew by 3.1 percent in the twelve months to June 2017 compared to a contraction of 0.7 percent in the corresponding period ending in June 2016.

The improvement in growth reflects a 4.9 percent increase in non-mining activity, from 3.3 percent in the same period. However, output in the mining sector contracted by 10.1 percent in the twelve months to June 2017 compared to a relatively large contraction of 22.9 percent in the corresponding period in the previous year. It is projected that domestic non-mining output will be below trend in the short-to-medium term, constrained by continued modest growth in household incomes and restrained economic expansion in major trading partners.

“Nevertheless, gradual economic recovery is expected in the medium term in response to anticipated improvement in external economic conditions,” reads the statement by the Committee. Global output is projected to grow by 3.6 percent in 2017, compared to an estimated 3.2 percent in 2016, and 3.7 percent in 2018, reflecting expected improvement in performance in both advanced and emerging market economies. However, uncertainty surrounding global trade policy and openness as well as moderation of growth in China could adversely affect the medium-term growth prospects. Regionally, the projected weak economic growth in South Africa in 2017 due to persistent subdued demand and low investor confidence could potentially undermine growth by constraining private investment and household consumption.

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SMEs benefit from Consumer Fair growth

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The Botswana Investment and Trade Centre (BITC) has applauded Botswana Consumer Fair’s continued efforts to improve small to medium enterprises’ linkages.

BITC Chief Executive Officer, Keletsositse Olebile, when opening the fair, said the event has provided interactive forum for both local and foreign exhibitors. He said the shopping show has enabled manufacturers, wholesalers and traders to market their products directly to consumers, an alignment to government’s endeavors.

“As part of government intention, we continually encourage local sourcing by retailers and distributors,” said Olebile who is just few months into his new post. He further celebrated the growth of Botswana Consumer Fair over the years, attributing the expansion to quality of goods displayed at the previous shows.“Improved quality and increased variety of wares increases the interest of the visitors and makes them look forward to returning the following year,” said Olebile.

This year’s exhibitors at the 13th event still running under the banner: ‘It is more than just shopping’ have been drawn from Lesotho, Zambia, Swaziland, South Africa, Nigeria, Ghana, Kenya, Egypt, Japan, India, Tanzania and Zimbabwe.

Consumer Fair is a flagship event for Fairgrounds Holdings and provides a platform for small medium enterprises (SMEs) from the different sectors of the economy to showcase and promote their products and services. In addition, the SMEs are expected to establish long term business linkages and promote local manufactured goods.Fairgrounds Holdings is already optimistic that the Fair immensely contribute to the socio-economic development of the country through supporting SMEs.

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‘Involve SMMEs in standards development’-Minister

Keikantse Lesemela

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Minister of Investment, Trade and Industry, Bogolo Kenewendo appealed to Botswana Bureau of Standards (BOBS) to include the Small, Medium and Micro Enterprises (SMMEs) when developing the standards to improve the sector.

She said the Ministry of Investment, Trade and Industry has identified three areas of focus going forward which are modeled on SMME development, investment promotion and export development apexes. “I would like to implore you to include this sector in standards development processes and assist in improving SMMEs conformity to standards and compliance to technical regulations,” said Kenewendo.

Speaking during the BOBS Technical Committee Members appreciation ceremony on Thursday, Kenewendo explained that the important roles of standards are underpinned by the aspirations and intentions espoused in both diversified export led economic growth and job creation as priority areas. “It goes without saying that the diversification of the economy requires a National Quality Infrastructure and Technical Regulatory Framework that promote competitiveness of Botswana goods and services.”

She also emphasized that an effective National Quality Infrastructure and Technical Regulatory Framework are essential as they provide crucial links to global trade, market access and export competitiveness through their contribution to consumer confidence in product safety, quality and the environment.Since inception in 1997 BOBS has published more than 1700 standards through 48 technical committees across several sectors of the economy; 109 certification licences have been issued against some of these standards. Currently 46 Botswana Standards are being implemented through the standards regulations with a view to protecting the health and safety of consumers as well as protection of the environment.

On her note, BOBS Vice Chairperson of the Standards Council, Professor Edward Dintwa said standards are powerful tools for helping organisations that implement them to realize their potential, have access and compete in the global marketplace. “In this highly competitive and complex world, issues of sustainability and productivity, viewed from economic, environmental and societal perspectives require that businesses must be more efficient in their operations, which can be achieved through the implementation of standards”.

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