Controversial Brite Star Aviation, a purportedly US based company which was destined to develop an Aviation plant to resuscitate the bid ridden economy of Selebi Phikwe following the collapse of BCL copper and nickel mine dumped Botswana for Malaysia, Weekend Post has learnt.
This is notwithstanding a signed official Memorandum of Understanding the company entered into with SPEDU, Civil Aviation Authority of Botswana (CAAB), Botswana International University of Science and Technology (BIUST), Selebi Phikwe Town Council (SPTC), Botswana Investment and Trade Centre (BITC) and the Ngwato Land Board.
Based in Fredericksburg, Texas, with Directors from Hungary, Brite Star had promised to develop in Selebi Phikwe an aircraft manufacturing plant, where B22 lightweight aircraft will be manufactured, aviation academy, the aircraft service/maintenance/repair, pilot training academy, a research and development centre and Eco safari tourism among others.
The manufacturing plant was estimated to cost a whopping 1.5 billion pula in which Brite Star was to solicit the funds from both Botswana government and abroad in order to design and build the state of the art plant. In the process, Brite Star assured Batswana to create at the plant more than 3000 jobs in the then succeeding five years in Selebi Phikwe – to compensate for more than 6000 people that lost their jobs –when the BCL mine collapsed.
Speaking at the media tour organised by SPEDU this week, Chief Executive officer (CEO) Dr. Mokubung Mokubung confirmed that indeed Brite Star dumped Botswana and he heard reports that they opted for Malaysia instead. The company claim to have a number of operations in the US, Hungary and China.
“I heard that after abandoning Botswana, they went to Malaysia to invest the said Aviation school. They left us hanging, stranded and hungry for the deal that did not see the light of the day,” Dr. Mokubung said this during the media visit at the Selebi Phikwe airstrip/airport which is adjacent to where the 1.5 billion pula aviation plant was to be developed.
He continued: “there is a cartridge this side next to this airport spanning 10 hectares of land that we secured for Brite Star Aviation plant. We did first stage of due diligence and what was left was the next stage of due diligence. However the company then pulled out from the agreement. They did so by simply saying they will be back and went into thin air.”
According to Dr. Mokubung, it appears they were not the only one which Brite Star was targeting and that include the Southern African Development Community (SADC) and even international and it seems they preferred other countries other than Botswana, mostly likely Malaysia.
“They didn’t even write to us to inform us that they have pulled out of the deal despite having signed a proper Memorandum of Understanding,” he observed. The SPEDU CEO said they are disappointed by Brite Star decision as the ‘shady’ company took a business decision on their own in America and Hungary while dumping Botswana.
“They shunned us notwithstanding that they have given us reasons that Phikwe has free air space and therefore it will be good for the aviation school. We have made proposition at the government to put in place utilities like water and extra power and the rail spare and all were in order in our judgement.”
Dr. Mokubung recounted that, at that point where Brite Star started keeping quiet, and kept quiet for long, they then discussed the matter with Board of Directors of SPEDU to call the deal off and tell Batswana that “it failed.” Another board member who was also on the tour buttressed the CEO by adding that when there is a problem somewhere, like it was the case in Selebi Phikwe, everyone can claim to solve the problem and may try their luck as Brite Star did. “And then when you want some kind of due diligence then they chicken out.”
The board members stated that the collapsed deal with Brite Star, had made them to come to a point where they have to question the real mandate of SPEDU whether there is no how it can be strengthened because as it stands “we simply facilitate, we canvass, we cajole the companies to invest in Selebi Phikwe region and then what? If they refuse/ dump us, then what?”
Recently, Brite Star Legal and Transactional Advisor, Advocate Efan Khan has told a local newspaper last year that Brite Star has not finalised its intention to set up its Aviation Assembly plant in Botswana as yet. “Some issues still require to be addressed such as (Environmental Impact Assessment (EIA), utility connections etc. If those items will delay Brite Star’s entry into Botswana, Brite Star may consider other countries to locate its Aviation plants since Brite Star has to deliver on confirmed orders for aircraft,” said Khan at the time.
Meanwhile, some key people and decisions makers in Selebi Phikwe have always been sceptical about the plan SPEDU has with Brite Star calling it dubious and shady. Among them, Selibe Phikwe West lawmaker Dithapelo Keorapetse had told Weekend Post that it was not clear whether the company, Brite Star, is genuine and had good intentions to develop the desperate Selibe Phikwe.
“I wish to caution government and SPEDU to be cautious about flyby night investors who will take advantage of our desperation to revitalize the economy of our town,” Keorapetse highlighted back them about the company which he asserted that “raises eyebrows”.
He said Botswana should have learnt a lesson from the 500 million pula Palapye Glass Project where the company name is also nowhere in the list of approved manufacturers in China or Hungary where it claims to have presence. Keorapetse asserted that Brite Star Aviation is not a multinational corporation specializing in aircraft parts manufacturing and maintenance and pilot training as they purported.
“I hope this is not a company trying their luck in the aviation industry through the help of Botswana government. Aircraft manufacturing maintenance is no child's play, it takes many years of research and development, innovation and huge investment, this track record is unclear for Brite Star,” he said then. Due diligence, according to the MP, must be done to the fullest before the government injects money and gets robbed like in Pula Steel and the collapsed 500 million Palapye Glass Project.
In an email conversation with this publication, Mbaki Ngaiti, an Aircraft Maintenance Engineer with Air Namibia, also had his reservations with Brite Star citing that the competence of the company was unclear. “While this sounds very exciting in terms of the positive socio economic impact such a huge investment would bring to the struggling mining town, it would be very naïve not to scrutinise Brite Star Aviation to determine if indeed their promises will come to fruition.”
He said Brite Star Aviation is just a group of aviation hobbyists and enthusiasts, operating a lodge in a hangar in Fredericksburg. Meanwhile the Legal Advisor for the company Brite Star Aviation Advocate Khan explained to Weekend Post recently that “Brite Star Aviation is a joint venture set up for the proposed Botswana and other operations.
It will incorporate a local Botswana company in the event it proceeds to invest in Botswana.” He also said then that the entity has not entered into any partnership or joint venture with the Botswana Government. He said on October 20, last year, Brite Star Aviation will be flying into the country with their engineers and other people to do designs of the plant at Selibe Phikwe.
“Their shareholders approved funding. They will show us the money in Botswana and millions will be deposited. They would have put necessary funds in their Botswana account. Already they have opened an office in Gaborone. We will give them the benefit of the doubt.” Unlike the Arabs who ditched the Botswana government at the eleventh hour, at least for now, he said, they can trust Brite Star Aviation.
However, the deal has collapsed and Brite Star is nowhere to be found. Meanwhile, when answering a question in Parliament still last year, the then Assistant Minister of Trade, Assistant Minister of Investment, Trade and Industry Biggie Butale said they were not aware of any red flags that should raise alarm as the proposed development was similar to what the Brite Star was currently establishing in Malaysia and ‘this project is purely a Foreign Direct Investment venture.’
Government is currently sitting on 4 400 vacant posts that remain unfilled in the civil service. This is notwithstanding the high unemployment rate in Botswana which has been exacerbated by the recent outbreak of the deadly COVID-19 pandemic.
Just before the burst of COVID-19, official data released by Statistics Botswana in January 2020, indicate that unemployment in Botswana has increased from 17.6 percent three years ago to 20.7 percent. “Unemployment rate went up by 3.1 percentage between the two periods, from 17.6 to 20.7 percent,” statistics point out.
Leading commercial bank, First National Bank Botswana (FNBB), expects the central bank to sharpen its monetary policy knife and cut the Bank Rate twice in the last quarter of 2020.
The bank expects a 25 basis point (bps) in the beginning of the last quarter, which is next month, and another shed by the same bps in December, making a total of 50 bps cut in the last quarter. According to the bank’s researchers, the central bank is now holding on to 4.25 percent for the time being pending for more informed data on the economic climate.
An audit of the accounts and records for the supply of food rations to the institutions in the Northern Region for the financial year-ended 31 March 2019 was carried out. According to Auditor General’s report and observations, there are weaknesses and shortcomings that were somehow addressed to the Accounting Officer for comments.
Auditor General, Pulane Letebele indicated on the report that, across all depots in the region that there had been instances where food items were short for periods ranging from 1 to 7 months in the institutions for a variety of reasons, including absence of regular contracts and supplier failures. The success of this programme is dependent on regular and reliable availability of the supplies to achieve its objective, the report said.
There would be instances where food items were returned from the feeding centers to the depots for reasons of spoilage or any other cause. In these cases, instances had been noted where these returns were not supported by any documentation, which could lead to these items being lost without trace.
The report further stressed that large quantities of various food items valued at over P772 thousand from different depots were damaged by rodents, and written off.Included in the write off were 13 538 (340ml) cartons of milk valued at P75 745. In this connection, the Auditor General says it is important that the warehouses be maintained to a standard where they would not be infested by rodents and other pests.
Still in the Northern region, the report noted that there is an outstanding matter relating to the supply of stewed steak (283×3.1kg cans) to the Maun depot which was allegedly defective. The steak had been supplied by Botswana Meat Commission to the depot in November 2016.
In March 2017 part of the consignment was reported to the supplier as defective, and was to be replaced. Even as there was no agreement reached between the parties regarding replacement, in 51 October 2018 the items in question were disposed of by destruction. This disposal represented a loss as the whole consignment had been paid for, according to the report.
“In my view, the loss resulted directly from failure by the depot managers to deal with the matter immediately upon receipt of the consignment and detection of the defects. Audit inspections during visits to Selibe Phikwe, Maun, Shakawe, Ghanzi and Francistown depots had raised a number of observations on points of detail related to the maintenance of records, reconciliations of stocks and related matters, which I drew to the attention of the Accounting Officer for comments,” Letebele said in her report.
In the Southern region, a scrutiny of the records for the control of stocks of food items in the Southern Region had indicated intermittent shortages of the various items, principally Tsabana, Malutu, Sunflower Oil and Milk which was mainly due to absence of subsisting contracts for the supply of these items.
“The contract for the supply of Tsabana to all depots expired in September 2018 and was not replaced by a substantive contract. The supplier contracts for these stocks should be so managed that the expiry of one contract is immediately followed by the commencement of the next.”
Suppliers who had been contracted to supply foodstuffs had failed to do so and no timely action had been taken to redress the situation to ensure continuity of supply of the food items, the report noted.
In one case, the report highlighted that the supplier was to manufacture and supply 1 136 metric tonnes of Malutu for a 4-months period from March 2019 to June 2019, but had been unable to honour the obligation. The situation was relieved by inter-depot transfers, at additional cost in transportation and subsistence expenses.
In another case, the contract was for the supply of Sunflower Oil to Mabutsane, where the supplier had also failed to deliver. Examination of the Molepolole depot Food Issues Register had indicated a number of instances where food items consigned to the various feeding centres had been returned for a variety of reasons, including food item available; no storage space; and in other cases the whole consignments were returned, and reasons not stated.
This is an indication of lack of proper management and monitoring of the affairs of the depot, which could result in losses from frequent movements of the food items concerned.The maintenance of accounting records in the region, typically in Letlhakeng, Tsabong, and Mabutsane was less than satisfactory, according to Auditor General’s report.
In these depots a number of instances had been noted where receipts and issues had not been recorded over long periods, resulting in incorrect balances reflected in the accounting records. This is a serious weakness which could lead to or result in losses without trace or detection, and is a contravention of Supplies Regulations and Procedures, Letebele said.
Similarly, consignments of a total of 892 bags of Malutu and 3 bags of beans from Tsabong depot to different feeding centres had not been received in those centres, and are considered lost. These are also not reflected in the Statement of Losses in the Annual Statements of Accounts for the same periods.