On how special economic zones contribute to the wider economy
In what ways do special economic zones (SEZs) boost foreign investment in Botswana?
JAYSON SECHELE: The aim and role of Botswana’s SEZs is to provide an investor-friendly business environment with a view to promoting domestic investment and attracting foreign investors. They are also being developed as centres for global business that will enable Botswana to achieve a level of global competitiveness that would otherwise take many years to achieve. SEZs are expected to benefit the country in a variety of ways, including domestic and foreign direct investment, exports to global markets, generation of government revenue and foreign exchange, employment creation and poverty eradication.
SEZs also serve as economic laboratories for policy reform. They provide opportunities for the development of backward- and forward-linked industries and other benefits such as technology transfer, entrepreneurship development and upskilling. Although the initial signs are promising, it is perhaps too early to gauge the level of improvement to the business environment, as the development and full operationalisation of the SEZs is still in the early stages of development. Four SEZs are set to be fully operational as of mid-2025.
To what extent do the recent reforms to SEZs aim to catalyse the country’s development strategies?
SECHELE: SEZs are being created as part of Botswana’s wider economic development strategy. They will operate within the context of the country’s domestic and international policy environment, and will leverage the synergies and benefits provided. The SEZs reforms are being used as one of the economic transformation strategies for economic growth, diversification and transformation. Policymakers will continue to leverage this to ensure the attainment of a common economic vision as outlined in Botswana’s Vision 2036.
Through SEZ reforms, the government aims to develop SEZs in strategic areas across the country as a strategy for promoting the development of industries that will lead to the diversification of the economy and turn the country into an attractive investment destination on the African continent. The development will be led by both the public and private sectors as well as public-private partnerships, as the market dictates.
What are the barriers to creating a more favourable business environment in SEZs?
SECHELE: The world economy is quickly becoming more globalised than ever. This is largely fuelled by the Fourth Industrial Revolution, where the application of ICT for speedier service delivery, innovation in new technology and creativity is the norm – as well as the core of all innovation going forwards. In some areas, undue red tape and bureaucracy have become things of the past, and investors are now highly mobile within an increasingly competitive global investment environment.
It is therefore vital for policymakers to be committed to ensuring that processes, policies and laws do not perpetuate the silo mentality, and that inter- and intra-disciplinary collaboration between government agencies is encouraged, in pursuit of greater economic dynamism. Core to this is removing undue red tape and bureaucracy and being committed to creating a more collaborative, agile, innovative and creative business environment. Speed and efficiency in service delivery, innovation and creativity will increasingly be the norm as the country seeks to attract more foreign investment.
How can environmental, social and governance (ESG) principles be more thoroughly incorporated into the SEZ value chain?
SECHELE: Vision 2036 is the blueprint for the attainment of the UN sustainable Development Goals. Within this, there is a growing focus on ESG criteria in the development and management of SEZs, inclusive of operationalising the zones as a whole. As such, ESG norms are being infused in SEZs master planning, infrastructure development and overall organisational strategy. This is intended to ensure that all organisational processes, policies, laws, projects and programmes fit hand-in-glove with the prevailing ESG standards.
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