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BDC profits before tax rise to P187 million

Botswana Development Corporation (BDC), government investment arm this week delivered impressive sets of financial results for the year ended June 2018, mirroring a good dispatch of their ongoing five-year strategy which commenced in 2015.

 The strategy was set-up by Managing Director Bashi Gaetsaloe who took over the reins in 2014 at a time when the corporation was embattled with corruption, maladministration and failing investments. At a stakeholder briefing hosted by the company in Gaborone this Thursday, Gaetsaloe observed that the  2018 trading period continued to be a challenging year economically both in domestic and global markets explaining that BDC was not spared from this toughened trading environment.

“However in the midst of these external factors, we have continued to make progress. We are now in the fourth year of our five-year strategy and we remain committed to our ambition to double the business in this strategic period,” he said. During the period under review the BDC Group raked in Profit-before-Tax of P187 million, mirroring an increase of 39 percent when gauged against P135 million registered in the prior year ended June 2017. The Group recorded a hike of 5 percent in asset base ending the trading year at 4.1 billion pula compared to 3.9 billion pula in 2017.

BDC also realised growth in interest income of 20 percent to P42million against P35 million reported during the prior year. When delivering these sets of financial figures BDC acting Chief Finance Officer Maranyane Makhondo said this was a reflection of the expected growth in debt assets, a milestone achieved in correlation with the corporation’s business strategy to rebalance the equity/debt asset profile.

“We  successfully drove an increase in investment asset values at Group level with financial results for the year under review reporting an accumulative 5 percent year on year growth of Group assets to P4.1 billion,”  reiterated Makhondo. Further zooming  into the  BDC Group’s financial highlights for the period under review  indicates that  income closed the year at P444 million against last year’s P403 million, reflecting  a 10 percent  growth year on year.

Company Profit before Tax increased by 18 percent to P244 million in 2018 from P206 million reported in 2017. Managing Director, Bashi Gaetsaloe shared that in addition to the reported financial results, his company also takes pride in the Moody’s Investors Service reaffirmation of their Baa2/Prime2 rating with a stable outlook.

 “The rating agency recognised our strong liquidity and capital buffers, and assumption of a high probability of government support  hence  our  issuer ratings entail a standalone credit profile of b1, which balances what Moody’s recognizes as a strong company solvency and liquidity position against a high concentration of strategic participation in large equity investments.”  

Gaetsaloe  further added that during the year 2018 BDC moved from equity investment to debt instruments with a view to align their portfolio composition to their investment mandate of  just being financers and not operators “we shrunk our equity injections and hiked our debt instruments because our job is not to run businesses  but just support, thus we took a deliberate stance to minimize our equity skates  with a view to  allow entrepreneurs , promoters and business owners  to run these business so we have been moving with a small minority stake investment wave to archive this” he said.

INTERNATIONAL INVESTMENTS

When updating stakeholders on BDC’s investment portfolio Chief Investment Officer (CIO) Moatlhodi Lekaukau shared that the company has stretched its investment outlook with a view to expand its African footprint and diversity the corporation’s revenue streams and various market reach. He shared that the corporation has closed in on a first international deal as well as upcoming transactions both in East and West Africa.

Lekaukau revealed that in Nigeria BDC is 80 percent wrapping up a lucrative transaction that would see the corporation hold a significant stake in an undisclosed telecommunication company that operates consumer based mobile business.  “We are excited about this transaction, the company is one of the top five in Nigeria, and we know the country hosts a large vibrant market so we a looking at impressive returns from this deal,” explained Lekaukau adding that an investment in the Ghana energy sector is also in the offing.

The Chief Investment Officer also shared that in Uganda, BDC will be investing in an oil refinery business, “we are cautious with this offshore investments, but they are key to our diversification strategy which seeks to expand our footprints into other vibrant and bigger markets and East Africa as well as West Africa presents that, especially in the energy and telecommunication sectors” said Lekaukau.

Commenting on these investments Managing Director Gaetsaloe added that BDC’s investments outside boarders of Botswana present a great opportunity for the company’s ambitions of being a window for Botswana’s economic aspiration. “Once we take a Botswana investment company outside our boarders we send a good image of Botswana’s economic capacity and ability, as we close these deals we create linkages with some of these companies to come and explore possible joint ventures here in Botswana with local companies as well as explore other potential business opportunities” said the BDC MD.  

BDC’S FIVE- YEAR STRATEGY

Speaking to the five-year strategy Gaetsaloe explained that the strategy was bearing fruits. “We believe that our five-year strategy has delivery results, over the cause of the last four years we have returned BDC to profitability with cumulative profits of P784 million pula, paid off debt of P500 million and transferred P285 millions of listed stock to the public. We have also transferred business and assets worth over P300 million pula to local firms and Batswana, and reduced our loss making subsidiaries from nine to two. This are commendable sets of achievements,” he said.

During the last four year BDC approved P952 million to fund new projects and creating over 1200 new jobs. The government investment arm established a Reserved fund and an Investment Fund which are capitalized at over P230 million. “We have always wanted to have a buffer fund to accommodate possible shocks, that way our funders and lenders have confidence in our borrowings, to say if there was a shock to our income streams we would continue to meet our repayments obligations,” he said.
Going forward, Gaetsaloe reiterated that BDC would be aligned directly to the national vision 2036 of achieving a high income economy for Botswana.

“We are a self-funding company that strives to pay-out an increasing dividend to our shareholder, being government, on year-on-year basis, we gather our funding by borrowing from local banks and capital market so that we can invest on commercial projects that drive industrialization, and create employment for Batswana,” he said.

BDC paid dividends to Botswana Government for the past three trading years since 2015 after a decade of loss making. “We raise funds, deploy fund and look after these funds to achieve shareholder value and for the year under review we have successfully driven growth across the business including significantly net worth by P700 million since 2014,” said Gaetsaloe.

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Opposition talks: Conveners ditched, experts engaged

13th October 2021

The much-anticipated opposition unity talks that will see Umbrella for Democratic Change (UDC) engage Botswana Patriotic Front (BPF), and Alliance for Progressives (AP) are expected to kick off any time from now.

According to informants, the talks, which were preceded by-elections negotiations, aim to be as inclusive as possible. As the talks start, the UDC, composed of Botswana National Front (BNF), Botswana Congress Party (BCP) and Botswana People’s Party (BPP), insist on retaining its preferred model of Umbrella; on the other hand, the BPF is proposing a PACT; and AP is in favour of an alliance model.

BPF is reportedly sceptical on the umbrella model and wants cooperation with the flexibility to allow other parties to join hands with UDC but without necessarily contesting elections using UDC symbols and colours.

BPF, which is currently the fastest-growing party, seems to be focused on self-actualization, self-preservation and securing institutional capacity in case of any political calamity. Although often profitable, cooperation politics can often leave individual political parties battered by political events and weakened beyond meaningful survival.

Discussions with some BPF members suggest that the party has big ambitions and harbour serious intentions of taking the BDP by its horns-all by itself-one day. “The position by some of our leaders is that the future of the UDC remains uncertain. The position and advice are that we should not put all our eggs in one basket. And the party elders think the pact model of cooperation is the safest under prevailing circumstances. Some, however, are worried that we should not overestimate our worth despite being the fastest-growing party in the country.

However, the matter is yet to be concluded once we receive the official invite,” revealed a BPF member of the NEC. Asked about the specifics of the pact idea, another high ranking party official revealed that the party Patron, Lt Gen Ian Khama and his brother Tshekedi Khama are among those who are for the election pact model.

BPF Spokesperson Lawrence Ookeditse has earlier this year told this publication that: “We have not settled on a model yet.” He also added that as a party, they are ready and willing to work with UDC, “but we will have our thoughts on how the cooperation or the talks should transpire, and they too will tell us their preference, and we will sit on the table to see how best to work together”.

AP heads into these negotiations with proposals of its own. On the model part, AP has expressed flexibility but want its partners to consider other models. AP believes that beyond the umbrella model, the coalition could also have a matrix to ensure that opposition parties select the best candidates for parliamentary and council seats.

AP, a splinter party of the beleaguered Botswana Movement for Democracy (BMD), asks for the constituencies allocated to BMD in the previous talks before it was kicked out on the eve of the 2019 elections.

AP, which garnered a popular vote of under 40 000 in the 2019 general elections, is confident that it brings tremendous value to the UDC, and state power could be within reach in 2024.
To reconcile the various interest of political parties, the leaders have agreed to engage political experts in a bid to arrive at the best decisions.

“There will be no conveners because parties in the past believed that they (conveners) took decisions on behalf of the constituent parties, though they are not representing any. So, the idea is to rope in political experts to direct UDC and the negotiating parties as to which path of cooperation model to follow,” a highly placed informant said this week.

UDC convener Lebang Mpotokwane has also defended the umbrella model in the past, noting that it creates fewer problems for the participants. The negotiations will be the fourth opposition cooperation talks since the 2009 elections. The opposition has held talks in 2011, 2012 and 2017. The 2012 talks resulted in Umbrella for Democratic Change (UDC), which has been anchoring negotiations since then.

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‘Dingake’ name spoils Botswana’s interest in ILO top post

13th October 2021

When the Chairperson of the International Labour Organization (ILO) Governing Body invited member states to submit candidates for the vacant Director-General post for consideration, Botswana developed a keen interest.

It swiftly mobilized to beat the deadline, but the unions, upon consultation, nominated Justice Key Dingake as their preferred candidate, much to the government’s disappointment, who then decided to dump the whole issue altogether.

In accordance with the Rules governing the appointment of the Director-General and the decisions made by the Governing Body at its 341st and 342nd Sessions, the Chairperson of the Governing Body calls for candidates for appointment to the office of Director-General of the ILO through communication to all Governing Body members and all ILO Member States and candidatures must be submitted by a Member State of the ILO or by a regular or deputy member of the Governing Body.

The deadline for submission was on Friday, 1 October 2021, and candidatures were to be sent by postal or electronic mail to the following address to the Chairperson of the Governing Body.
This publication had established that when Cabinet sat to discuss the issue, it was resolved that the unions as key stakeholders should be consulted and requested to submit a name for consideration. They did and offered Justice Oagile Key Dingake-a distinguished scholar and labour law expert whose contribution to the country’s labour fraternity is unparalleled.

When asked this week to share their side of the story, the unions said they were first invited to partake in the process by the government but never got a response after they nominated judge Dingake as an ideal candidate.

“We sent our correspondence to the Minister of Employment, Labour and productivity, Mpho Balopi, with our suggested name being Justice Oagile Key Dingake, but since then we never got a response,” said unionist, Tobokani Rari who further expressed disappointment at how the government has handled the matter.

Rari said that while he would not want to impute any improper motives to anyone, the developments rekindled memories of the government’s hostility towards Judge Dingake, who has been forced by circumstances to take his skills and wealth of experience to the benefit of other countries. Balopi did not respond to questions sent to him and did not pick this publication’s calls at the time of going to press.

Cabinet insiders say Dingake’s name spoilt the party and dampened the spirits. “In the list of nominated names, he was the leading candidate, but I guess the powers that be could not imagine themselves campaigning for him and doing all they did for the Executive Secretary of SADC Secretariat, Elias Magosi.”

Dingake’s sin, observers say, has always been his progressive, independent mind and family’s political background, all of which have always stood in his way to progress to the country’s judicial ladder’s ends.

It is understood that also in the mix and preferred by the state was former Attorney General, judge, and now Ambassador and Permanent Representative of Botswana to the United Nations and other international organizations, Dr Athaliah Molokomme, who also has a background in human rights advocacy.

But insiders say many believed that the country should export Dingake to represent the country given his decorated experience and background. As a lawyer, Dingake represented 90% of Trade Unions in Botswana, drafted numerous Collective Labour Agreements, later presided overall trade disputes, including Collective Labour Agreements, and made determinations as Judge of the Industrial Court of Botswana.

Dingake has also written and lectured widely on trade, labour and human rights and holds numerous citations and awards for his work regarding peace, human rights, and social development. Had he contested and won, he would have been the first African to lead the ILO.

The ILO is built on the constitutional principle that universal and lasting peace can be established only if based on social justice. The ILO has been the source of such hallmarks of industrial society as the 8-hour day, maternity protection, child labour laws and a whole range of policies promoting workplace safety and peaceful industrial relations. Unique among UN organizations, the ILO has a tripartite structure involving governments, employers and workers.

ILO Director-General elections events lineup…

At its 341st (March 2021) and 342nd (June 2021) Sessions, the ILO Governing Body approved the following timetable for the appointment of the Director-General because the current term of office of the Director-General will come to an end on 30 September 2022:

1 July 2021: The Chairperson of the Governing Body calls for candidatures
1 October 2021: Last date for the reception of candidatures
A week in January 2022: The Chairperson of the Governing Body conducts interviews with candidates for the position of Director-General based on the format and principles contained in document GB.342/INS/6 and the guidance provided by the Governing Body at its 342nd Session
14-15 March 2022 (344th Session of the Governing Body): The Governing Body conducts candidate(s) hearings
25 March 2022 (344th Session of the Governing Body): The Governing Body conducts the ballot for the election of the Director-General
1 October 2022: The term of office of the Director-General commences.

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Botswana, EU clash over human rights issues 

13th October 2021
human-rights

Botswana and the European Union (EU) appear to have been at each other’s throats behind the scenes since last year, with the EU saying it held several meetings with Botswana to convince her to address human rights issues. 

This is contained in a 2020 Human Rights Report that reveals broad divisions in contentious issues boiling behind the scenes between Gaborone and the Union. According to the report, which was released recently, the EU says it “continues to follow closely three main human rights issues in Botswana: the application of the death penalty; the rights of LGBTI persons; and gender equality.”

“Botswana remains part of a small group of countries – in Africa and globally – which continue to retain the death penalty both in law and in practice. Three executions were recorded in 2020,” the report says. According to the report, the Botswana Government indicated that a public debate on the application of the death penalty should be part of its ongoing work towards developing a Comprehensive Human Rights Strategy and the related National Action Plan.

The report says further progress on the rights of LGBTI persons’ seen in 2019, when Botswana’s High Court decriminalised same-sex consensual relations, is still pending, subject to a final court decision over a government appeal.

“Finally, gender-based violence and the need to advance gender equality and women’s rights in society remain another challenge for the country. In response to the high incidence of gender-based violence – which has intensified in many countries during the current COVID-19 pandemic – the President and the First Lady launched a public campaign to fight gender-based violence and to promote equality,” the report says.

The report says the EU did not fold its arms and watch from the sidelines the human rights issues in question are concerned but confronted Botswana to have the contentious issue addressed. “The EU continued to engage with the Botswana Government, multilateral organisations, non-governmental organisations and the broader society in Botswana in three main areas: the death penalty, gender-based violence and empowerment of women, and rights of LGBTI persons, as well as on the support of media and implementation of Universal Periodic Review recommendations,” the report says.

The report says that in addition to ad hoc consultations and human rights-oriented outreach efforts, the EU engaged with the Botswana Government on human rights formally in the context of the Article 8 Political Dialogue, which took place in February 2020.

“The dialogue offered an opportunity to exchange views on EU’s and Botswana’s experiences concerning the three EU priority areas in Botswana (capital punishment, gender-based violence and rights of LGBTI persons) as well as other human rights challenges, while also exploring opportunities for EU-Botswana cooperation on human rights issues in the context of the EU-Africa partnership and at the multilateral level,” the report says.

In parallel to engagement with the government, the EU said it continued to maintain dialogue with representatives of civil society focusing on human rights and with UN organisations and other partners of the country.

“The EU continues to be the driving force behind the Gender Dialogue (in principle co-chaired with UN Women and the Gender Affairs Department in the Ministry of Immigration, Nationality and Gender), which brings together various stakeholders to discuss gender issues to chart a way forward regarding partnerships. The EU has also used public diplomacy efforts to stimulate broader dialogue in the country on human rights issues,” the report says.

The EU said it continued to provide financial support to projects funded through the European Instrument for Democracy and Human Rights, with activities focused primarily on helping Botswana tackle gender-based violence, strengthen the notion of gender equality in the country, and promote participation in political processes.

“With six projects already underway, the EU signed two new programmes, in the wake of the COVID-19 pandemic, to support victims of gender-based and domestic violence and defend the rights of marginalised people, with a combined budget of EUR 430,000,” the report says. It says one of the projects is designed to offer care services to victims of gender-based violence and provide clinical services, counselling, shelter, and a referral system for legal and social assistance. Another project provides legal, medical and psychosocial support to refugees, undocumented migrants and indigenous people.

It says Botswana remains an important like-minded partner for the EU on the human rights agenda at a multilateral level. “The country’s positive role on human rights in the multilateral context would be further strengthened by initiating a domestic process of reflection about the signature and ratification of several pending core human rights conventions and/or optional protocols (e.g. the Convention for the Protection of all Persons from Enforced Disappearances, the International Covenant on Economic, Social and Cultural Rights, the Convention on the Rights of Persons with Disabilities, the Optional Protocol of the Convention against Torture, etc.)” the report says.

But the report acknowledged that Botswana is a stable and well-established democracy with a legal framework and institutions designed to guarantee respect for human rights in society. It says human rights complaints are addressed by the courts, with the government accepting decisions and implementing relevant rulings.

“Although the media scene in the country is relatively undeveloped, the World Press Freedom Index has noted a further positive trend concerning the role of the media in society (as was also the case in 2019) and has improved Botswana’s ranking from 44th to 39th place (out of 180 countries),” the report says.  Meanwhile, this week, President Dr Mokgweetsi Masisi met with the EU delegation led by the managing director for Africa of the European External Action Services, Ms Rita Laranjinha.

 

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