FAWZIA AYA ABDULLAH -201600170
KENEILWE CONNIE BAISTSENYETSI-201603437
BOTSWANA’S ABILITY TO MAKE USE OF ITS MINERAL REOURCES IS CONSTRAINED BY ITS WEAK HUMAN RESOURCE
This paper aims to demonstrate the fields at which Botswana’s human resources are weak and how these impede Botswana’s ability to make use of its mineral resources. It has been shown that poor health makes the body weak hence reduces productivity, poor education has a large influence on the skilled labour available for mining and the development and use of technology in Botswana is very weak as compared to other countries and hence restricts efficiency of extraction and manufacturing of minerals, hence the human resource factors constrain Botswana’s ability to make use of its mineral resource. Besides weak human resources there are other factors such as infrastructure and foreign investment that play an important role in mining and are obstacles to Botswana fully utilizing its blessing in mineral resources.
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The purpose of this paper is to analyse if Botswana’s ability to make use of its mineral resources is constrained by its weak human resources. Availability of good human resource brings in skilled labour, efficiency and high productivity in the mining sector, which would result in maximum production of mineral resources .However Botswana, is disadvantaged with weak human resource which constrains its ability to make use of its mineral resources. Thato Moseki has argued that Botswana’s Archile’s heel is its poor human resource base which dims the country’s stellar performances elsewhere such as in macro-economic policy and mining, which is relevant to the findings, discussed below. The paper proceeds as follows, section 2 serves to explain the different factors that affect human resources that constrain Botswana’s ability to make use of its mineral resources, section 3 acknowledges other issues besides human resource that constrains Botswana’s ability to make use of its mineral resources and section 4 is a brief conclusion on the findings of this research.
Below are the weak human resource factors that constrains Botswana’s ability to make use of its mineral resources. These include amongst others: Health, Education, and Adapting to technology.
Good health is an important contribution to economic progress, as healthy populations live longer, and are more productive. Many factors influence the health status and the country’s ability to provide quality health services for its people. In the case of Botswana, health care has improved, 84% of the population in urban areas have access to health care and 74% of the population in rural areas have access to healthcare. Despite this, Botswana is still highly affected by HIV/AIDS which is hazardous to health. HIV/AIDS is the main challenge with Botswana’s human resource. This has an impact on each sector of the economy including mining. Health issues generally play an enormous role on productivity. Health is associated with hygiene, sanitation, diseases and so on. It is believed that education is a main factor of health, in the sense that only someone that is educated will understand the importance of hygiene and sanitation as well as nutrition which are basic essentials of being healthy. HIV/AIDS is one of the main factors that make the human resource in Botswana weak. The 2000 study predicted that by 2011 the proportion of households living below the poverty datum line will have risen by 6%(UNDP) and by 2021 the economy will be 33% smaller than it would have been without HIV/AIDS. The 2006 study predicted that by 2010, the GDP will be 24% to 34%(UNDP) less than it would have been without HIV/AIDS. The pandemic also contributes to the decline in labour productivity. Close to 24% of the adult population is affected by HIV/AIDS(econsult Botswana (PTY LTB)). The HIV/AIDS pandemic has an impact on labour supply, through increased mortality and morbidity, recent statistics have shown that 10% of the population of HIV/AIDS have died. Since most of HIV/AIDS infected population in Botswana is that of the working age, their death implicates loss of skill in the labour market more specifically in the mining sector. The loss of skill therefore reduces labour productivity. Moreover, those living with HIV/AIDS aren’t as productive as they would be without it. If employers are aware of employees health status specifically HIV/AIDS, they would be reluctant to hire or even keep workers due to monthly check-ups as well as the risk of them dying as it would increase employers cost of having to recruit and retrain workers, thus employers will choose to lay off workers and not hire, implying an increment in unemployment. Hence less labour productivity specifically in the mining sector. Most of Botswana’s export revenue is generated from the mining sector which is diamond mining. Reduced productivity due to HIV/AIDS would basically mean less diamonds for exports therefore reducing export earnings. To overcome HIV/AIDS Botswana’s government provides free Anti-retroviral therapy (ART) to its citizens. This means that Botswana will import expensive health care medication (ART’S), implying that Botswana now uses its revenue on importing these (ART’S) instead of using the revenue to expand or improve the mining sector. The reduction in export revenues from reduced labour productivity due to HV/AIDS results in a balance of payments deficit.
Education is important as it provides us with soft skills and practical skills that we use in economic development. Education helps to know things, for example, in mining, it gives engineers knowledge on how to extract minerals from mines and take caution. It also helps to stay healthy, fit and follow a productive lifestyle and as stated above health is important factor of human resources. Research and development in sectors such as mining break through innovation and are a progress midst-all of this are fruits of education which will take the nation and productivity further. The enrollment of primary education is 106%(education policy and data center) but decreases to 90% enrollment in lower secondary schools and decreases to even lower when it comes to upper secondary schools. There is 88.5%(education policy data) literate rate among the youth population, this is lower than the average youth literacy rate in other upper income countries. The more illiterate people and the fewer the number of people enrolling into schools would imply that we have fewer people to educate. Firms usually employ skilled or educated workers, this would mean that those that aren’t educated are barely employed hence increasing unemployment rate. The increase in unemployment rate would mean loss of productivity, that is in the mining sector the loss of productivity would be that there are fewer resources being extracted. According to the World Bank’s Doing Business Report 2009, the work ethic of national labour force that is inadequately educated ranked as the greatest challenges in Botswana. “The quality of labour is one of the constraints to mining in Botswana, the problem is related to the relevance of the curriculum in formal institutions of learning”. Botswana is producing graduates and some of them are being employed in the mining sector. However, the fact that Botswana has been exporter of raw mineral resources from way back up to the recent year proves that the labour employed have skills but the skills are inadequate since they are only limited to manufacturing and not processing. These limited skills inhibits Botswana to fully utilize its mineral resources as its revenue as its revenue earned from exporting raw mineral resources is much less than it would have been if Botswana was exporting processed mineral resources. A lot of those employed in the market have theoretical skills but lack practical skills. Miners are in need of practical skills as a lot of the work is practical. Without the practical skills, they are prone to making a lot of mistakes which could restrict the manufacturing of the minerals. Hence it can be concluded that Botswana has low quality labour which restricts its development in the mining sector. Also, there are those who are unable to afford education due to poverty hence this serves as loss of skill that could have been useful to maximize mineral resource use.
ADAPTING TO TECHNOLOGY
One of the weaknesses of human resource in the mining sector has been revealed by the inability of employees to adapt swiftly to rapid advances in technological innovation, including automation, digitization and electrification. The 2015 Global Information Technology report shows that the government usage of ICT is ranked better than the usage of individuals and businesses. The business-to-consumer use is ranked very low(120), as well as capacity for innovation by business and firm level absorption of technology, are 106 92 respectively. The country’s technological readiness is still ranked low(116th) with a below average quality score of 3.3. due to the challenges the country face around infrastructure, limited network access and international internet bandwidth are ranked very low. Botswana like other developing countries, has not fully exploited the potential of ICT to drive the mining sector and catch up with advanced nations. Since employees are unable to adopt to technological changes it therefore adds to the costs of Botswana because instead of effectively taking advantage of these technology to increase production, Botswana has to re-train the employees to equip them with skills. As a result production of mineral resources is not as maximal as it was supposed to be since the employees lack the skills to utilize the technology fully and also time and money are spent in training employees instead of producing mineral resources. On the other hand, since most tasks are automated by technology, many employees become lazy at work, technology kills their creativity. Simple tasks are being done with computers so you will find that employees do no put their brains to work. This implies that they can’t solve high-end business problems because they rely on a computer or software to do it with no challenge. In conclusion, it is evident that technology has an impact on human resource and it needs to be addressed in order for the country to benefit fully from the mineral resources.
Besides Botswana`s weak human resources there are other factors that constrains Botswana`s ability to make use of its mineral resources. These include among others, lack of foreign investment and infrastructural developments.
Botswana lacks a lot of foreign direct investment. Foreign investment is essential in every economy as it brings in more revenue in terms of taxes, creates employment, skills and technological advancements. Foreign investors can be very beneficial towards the mining sector. Foreign investors will employ local labour for their firms hence reducing unemployment, this will reduce the burden on Botswana to provide for the unemployed hence they can use the funds they used to support the unemployed into developing the mining sector in order to fully benefit from mineral resources.
Since more people would be employed , it would imply a higher number of people paying taxes hence government revenue would increase, also taxes from these foreign investors would be a part of the increase in government revenue and could also acquire a higher exchange rate for the currency, higher revenues would imply that the government is able to spend more money on developing the mining sector, if foreign investors are properly treated and are making profits, they will attract more foreign investors into the economy and some of these investors may be interested in the mining sector, hence they can help the government in terms of finance to help develop the mining sector.
Most foreign investors, specifically those in the mining sector will introduce some technological advancements and skills that local employees do not have. The local employees will benefit by learning these skills and how to use the technological advancements, these advancements can help speed up productivity, hence give Botswana full use of its mineral resource. The foreign investors may want to focus on processing the mineral resources which is something that Botswana has struggled to do due to lack of skills, technological advancements and machinery. This will help or rather contribute to Botswana`s being able to fully use its mineral resources.
Foreign investment creates competitiveness in the market, this will result to an increase in investment locally, even in the mining sector, which will generate employment as well as generate more revenue.
Although Botswana has some foreign investors it has emerged from review that companies in Botswana are not legally required to contribute to local development such as infrastructure. The issue of lack of infrastructure development was also brought to the fore by global consulting firm KPMC which says “Botswana has the potential to become a mining mecca because of its mineral rich wealth.” However the firm notes that the region lacks the necessary infrastructure such as rail, road, ports and telephone and communication coverage, which creates challenges for miners. Infrastructure developments attracts foreign investors which is likely to benefit the country as a whole by generating higher revenues attained from taxes generated from these investors as well as higher employment and most importantly competition in the market which will aim at driving prices of human resources. The building of roads serves as an advantage to human resources, availability of transport and makes it easier for miners to travel between places to see family and so forth; miners would be willing to work far from home provided they are able to visit home regularly and that is done through developing roads. Also when there aren’t proper roads it is difficult and potentially costly to transport mineral resources from one place to another hence this could restrict how much one could transport minerals each time which in turn could slow down productivity. Most of Botswana`s mines are located in rural areas and these areas lack a lot of infrastructural developments. This alone leaves investors to question their investment in mining as it rare for workers to stay in an area where there is no adequate housing, electricity and so forth. Therefore if there are few workers or no workers why would one want to invest in mining? Developing of road, rail and port is essential as it is very convenient in transporting the mineral resources, the easier it is to export the mineral resources and the less costly it is to transport them the higher the demand or quest for mineral resources will be. Development of infrastructure will not only benefit the mining sector but the economy as a whole. Developing the economy as a whole in the sense that human resource can be developed hence reducing its constraint on the mining sector.
This paper aimed to analyse how Botswana’s use of mineral resources is constrained by its weak human resources. The findings stated that Botswana’s human resources are weak at the fields of health, education and adaptation to technology and therefore negatively influences Botswana’s ability to maximize its use of mineral resources. Furthermore, it has also been indicated that there are factors not associated with human resources, such as, lack of infrastructure and foreign investment that constrain Botswana’s ability to make use of its mineral resources. Regardless of the other factors, Botswana’s weak human resource is the main obstacle to fully benefit from its mineral resource implying that if this is not dealt with Botswana will continue producing under its total capacity to produce and may not take its mining sector to its full capability. Botswana should temporarily employ people that have experience in mining from countries who have excelled in the mining sector in order to impose their skills on our labour force and advice on how to improve the mining sector.