Botswana’s government takes bold steps to retain tourism revenue, empowering citizens and boosting the local economy. (photo/gettyimages)
Gaborone (EPICSTORIAN) – Botswana’s government is set to initiate a policy shake-up that will address revenue repatriation in its tourism sector, a move aimed at retaining economic benefits within the country.
Much of the billions of pula generated annually in Botswana’s tourism industry is controlled by foreign-owned companies, leading to substantial financial outflows. This has sparked concerns about its impact on the local economy, employment, and citizen participation.
Minister of Environment and Tourism, Wynter Mmolotsi, addressed Parliament this week, acknowledging the issue of revenue repatriation and the urgent need for reform. “My Ministry advocates that all revenue generated from tourism licensed operations should reach Botswana and be reported accurately in Botswana,” Mmolotsi stated.
He emphasized that keeping revenue within the country would minimize economic leakages, boost local investments, and prevent tax evasion.
In response to questions from Tati East Member of Parliament (MP), Tapologo Furniture, Mmolotsi revealed that the government has already started reviewing the Tourism Act of 2009. The proposed amendments aim to mandate that all payments for tourism activities be made in Botswana’s local currency.
“Government expects that mandating all payments in local currency will prevent cash outflows while maximizing the economic benefits of tourism for the local population,” Mmolotsi explained. He added that stiffer penalties and enhanced financial monitoring will be implemented to deter non-compliance.
The government is also conducting a Tourism Leakages Study, set for completion by January 2025. This study will identify areas of financial leakage within the tourism sector and propose strategies to address them.
“My ministry will continue to collaborate with stakeholders such as the Ministry of Trade and Ministry of Finance in mitigating revenue repatriation in the tourism sector,” Mmolotsi affirmed.
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The dominance of foreign-owned safari companies has long limited opportunities for Batswana in the tourism sector. Many citizens are relegated to low-wage positions, while management roles are often occupied by expatriates.
This inequality led to the adoption of the Revised Tourism Policy in April 2021, aimed at empowering Batswana and promoting greater citizen participation. The policy acknowledged that high-value tourism opportunities, such as luxury lodges, remain concentrated in the hands of a few dominant operators.
Joint ventures between citizens and foreign investors are rare, and citizen-owned tourism enterprises often lack access to capital and markets, according to a local source.
The late Minister of Environment and Tourism, Dumezweni Mthimkhulu, had highlighted progress in this area earlier this year. By January 2024, the Ministry had licensed over 3,200 citizen-owned operators, a significant increase compared to the government’s annual target.
Mthimkhulu noted that this surge demonstrated rising interest among Batswana in participating in the tourism industry, a sector that continues to play a pivotal role in Botswana’s economy.
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Botswana, often hailed as one of Africa’s most stable democracies, faces a unique mix of challenges despite its political stability. The economy, heavily reliant on diamond exports, struggles with limited diversification, high unemployment rates, and significant wealth inequality.
While tourism remains a cornerstone of the economy, accounting for a substantial share of GDP, the dominance of foreign ownership has exacerbated economic leakages.
The government’s renewed focus on legislative reforms signals an intent to maximize local participation and economic retention. This effort aligns with broader economic diversification strategies aimed at reducing Botswana’s dependence on diamond revenue.
If implemented effectively, the proposed reforms to the Tourism Act and the completion of the Tourism Leakages Study could transform Botswana’s tourism sector into a more inclusive, citizen-driven industry.
Mmolotsi’s strong argument for a policy shift seeks to address long-standing grievances among Batswana, who have long called for meaningful access to the country’s tourism wealth.
