DOES government really need to have shares and veto rights in Meatco? That is the basis on which recalcitrant Meatco livestock producers have decided to take on the current Minister of Agriculture, Water and Forestry, the Hon. John Mutorwa.
Yet, should that be the pressing question? Should we, as a nation, not rather ponder the objectives of what Cabinet wants to achieve through the proposed state-shareholding?
For the record, not only is the government minority shareholding restricted to 30 percent, but also it is to be held through a livestock fund whose proceeds would surely benefit livestock farmers across the country. Further, the majority shareholding, 70 percent, would be held directly by a collective of producers across the country, instead of a group of few fortunate well-established livestock farmers on the one side of the veterinary cordon fence.
So far, the only reason provided for rejecting the proposed shareholding is what producers ostensibly term 'government interference in a free-market economy'. The poor financial performance of the Botswana Meat Commission (BMC) over the last two years is being cited as an example of how government's involvement in business leads to 'failure'. BMC and Meatco have similar functions, that of procuring livestock, slaughtering them and marketing the meat to international markets.
However, the two institutions were neither founded on the same principles nor are their shareholding structures composed in a similar fashion. While BMC is purely a state-owned institution established for that specific purpose, Meatco is an inherited institutional legacy from the South African administration that was specifically created to care for a minority group of farmers.
The Meatco Act of 2001 did very little, if anything, to reform the basic tenets that founded the then SWAMEAT, the predecessor of Meatco. It was under Meatco's previous chief executive officer, Philip Stoffberg, that tensions between communal farmers and Meatco mounted, mainly on issues of livestock procurement prices, slaughter bonuses and the marketing of beef.
At one point the dejected communal farmers north of the veterinary cordon fence engaged August 26 Holdings, a state-owned company under the Ministry of Defence, to tap into the Angolan market and the Democratic Republic of Congo (DRC).
With no experience of trading in perishable goods such as beef, and the intricacies of agricultural phyto-sanitary requirements, August 26 Holdings came short on its agreement with the northern farmers, leaving hundreds of cattle standing in abattoirs quarantine pens.
So desperate to find better prices compared to those offered by Meatco were the farmers. A 2005 memorandum of understanding between Meatco and the farmers did not really help matters either. That is why Cabinet decided to commission a study on how to straighten out the impasse. The study took five years to complete. Stakeholders were called, including Meatco's board. The reports went to the Cabinet committee on trade, which again gathered its own input, including input from the Meatco board. In the end, Cabinet reached the decision, which in its wisdom will eliminate the persisting concerns.
Granted, the majority of livestock producers who have reaped the higher prices and bonuses that Meatco pay its regular and well-to-do farmers, are right to be anxious about their status quo in a new Meatco structure. Indeed, the anxiety of not knowing how the transformation process would affect them, and how they would fit into a new structure where farmers on either side of the veterinary cordon fence are treated equal, could be overwhelming.
Yet such concerns should not override the national interests, or water down the serious trade imbalances in the sector. It is time that livestock producers approach the topic with a sober mind, critically engaging government with the view of formulating an acceptable outcome to benefit the next generations of farmers equally across the entire country.