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Botswana: Millers, Govt Disagree Over Import Restrictions
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Mmegi/The Reporter (Gaborone)
11 April 2008
Posted to the web 14 April 2008
Lekopanye Mooketsi
Gaborone
The Chairman of the Botswana Millers Association, Lazarus Lekgoanyana, has complained that they are hit hard by an influx of maize products imported from neighbouring countries.
Lekgoanyana said there is no border control over the amount of maize products imported into the country.He said the government has come up with a restriction called 70/30, which implies that 70 percent of maize products should be procured within the country.But traders are contravening this restriction.
Last year, the association raised this matter with the Ministry of Agriculture.Lekgoanyana said in November 2005, the government took the initiative to promulgate that maize products consumed in the country be procured up to at least 70 percent from local sources while 30 percent is imported under certain pre-permit conditions.
Lekgoanyana said while the issuing of the permits is paramount to government achieving its intention, their issuance at various places defeats the intended purpose.
"The intention of controlling imports is defeated, much to the detriment of local producers and sources. Border posts at Lobatse, Gaborone, Selebi-Phikwe, and Francistown are of particular concern," he stated.
He disclosed that an independent survey had revealed that by allowing imports unabated, the government was putting at risk some P400 million investment and 1,500 persons employed, resulting in little incentive for further investment. "It is a well known fact that the maize milling industry in South Africa is struggling and that the brands being imported into Botswana are from companies that are struggling in South Africa," Lekgoanyana said.
Lekgoanyana said other Southern African Development Community (SADC) countries like Namibia, Lesotho and Swaziland have imposed a total embargo on the importation of maize products. He believes that by so doing, these countries have been able to retain investment and employment in this industry.
The millers association is concerned that local millers are actually importing most of their purported production from their sister companies in South Africa. Lekoanyana said the perpetrators mainly use the Ramatlabama border post after acquiring permits by devious means.
He said they are experiencing a situation where imports still enjoy preference in government tender awards at the peril of locally produced products and that this is mostly prevalent in Selibe-Phikwe.He called on the government to effectively consider putting monitoring controls in affected areas.In his response, the Deputy Permanent Secretary in the Ministry of Agriculture, Dr Micus Chimbombi said insufficient monitoring of products entering the country is aggravated by the fact that the ministry does not have enough staff.
But the ministry will ensure that it intensifies its field visits to the suspected border posts to apprise customs officials of the concerns raised. Chimbombi said before his ministry could recommend total ban on the importation of maize meal, a study should be conducted to determine the food production capacity of local maize millers regarding the national demand.
He said the study should look at the wider issue of the importation of maize meal, including exotic brands and their rate of consumption comparative to local brands. Chimbombi said protecting local maize meal from competition with foreign maize meal with a high level of competitiveness may be beneficial in the short term and may increase profits for the domestic industry and maintain stable employment in the industry.
However, he pointed out that restrictions generally distort the distribution of economic benefits. He said restrictions could also harm consumers who would lose access to cheaper imported products. Total import restriction may also impede efforts of domestic producers to improve productivity or streamline operations in order to survive in a tough business environment.
Chimbombi said Statutory Instrument No.66 of 2005 clearly states that "any person applying for (an) import permit for maize meal, samp, maize rice, or animal feed for poultry and livestock shall be required to purchase at least 70 percent of the requirements locally and the remainder can be imported".
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He said the instrument recognizes consumer choices and encourages the uptake of local production. Chimbombi said imposing a total restriction would limit consumer choices and would be tantamount to disregarding consumer tastes and preferences. He said the ministry encourages the milling industry to gear itself up for free trade. "It is only if we can develop a vibrant industry, efficient and responsive, that we will compete in a free market economy, assured that the industry is sustainable."
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