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Khama, Masisi in court for P250 million scandal

Bakang Seretse’s attorney in the on-going multi-million National Petroleum Fund (NPF) money laundering case, Kgosietsile Ngakaagae, has subpoenaed President Dr Mokgweetsi Masisi, his predecessor Lt Gen Dr Ian Khama and other senior government officials to explain to court their role in the case.

Among senior officials that have been called to court are: former Directorate on Corruption and Economic Crime (DCEC) Rose Seretse;  director of DCEC Bruno Paledi; Deputy Director Operations DCEC Eugene Wasetso; Permanent Secretary to the President Cater Morupisi; former minister of Presidential Affairs, Governance and Public Administration Eric Molale; former minister of Minerals Sadique Kebonang; former Acting Permanent Secretary at Minerals Dr. Obolokile Obakeng and Director Finance Directorate on Intelligence and Security Moipedi Nkoane.

Ngakaagae served the Attorney General’s Chambers, Directorate of Public Prosecutions and DCEC with the documents last week.  Ngakaage states on his papers that, “We remind that at the last hearing of this matter before Judge Godfrey Radijeng, we made the point that there are disputes of fact in this matter. Accordingly, we communicated to the honourable court and to yourselves, that there is no way the matter can be justiciably resolved unless there was a full blown trial and until all state actors relevant to the issue were called to give evidence and subjected to examination,” he stated on the papers.

“Such disputes relate to the quaere, as to whether the amounts and assets subject of the restraining order are in fact proceeds of crime such that they could be liable to forfeiture.” He has also requested the said parties to confirm if they can have a consent order for a full-blown trial or whether there will be a need to make an application for the same.  “In the event of your objection to a full-blown trial, application shall be made for the dismissal of the matter on account of resoluble disputes of fact.

“We advise that the evidence of the witnesses will settle several issues including the alleged conspiracy between clients and Kerekang; the alleged breach of procurement process, the existence of any guilty intention on the various actors, the disputed version by Kgosi in so far as it relates to clients, State ownership of the project And its funding and selective justice among others.”

Dr Ian Khama

According to Ngakaagae, Khama is the only authority to which former Director DIS, Isaac Kgosi reported. “As such it is important to know of all relevant between the same in so far as the expenditure is concerned. It shall be required that the Office of the President produce all documentation that was ever generated or that is in their custody regarding the expenditure.” 

Dr Mokgweetsi Masisi

President Masisi will be required to testify on his knowledge of the transaction as Vice President to the now retired Khama. And to any meetings he may have attended regarding the transaction and matters incidental thereto.

Rose Seretse

She is said to have attended a stakeholder briefing on September 18, 2017 with Kebonang, Obakeng, Bakang and Kenneth Kerekang.

Bruno Paledi

Paledi is expected to testify as to when he first got to know about the contract between the DIS and Dignia Systems-the Israel Company. He will also be called to explain as to why the key State actors in Kgosi, Sadique and Obakeng were not subjected to the same treatment as Bakang and his co-accused Botho Leburu and Kenneth Kerekang. “He is relevant for testing the genuiness of the DCEC conspiracy claims.

To produce all material relevant to the case recovered from the DIS or any other government department,” states the document. “He will confirm he indeed ever visited Briscoe Attorneys whereat he requested for the disposal of legal files in so far as such related to the case. And to further explain the full extent of investigations regarding any benefit that may have accrued to any person regarding the amounts in issue.”

Carter Morupisi

He is expected as the head of civil service and secretary to cabinet, the extent, if any, to which cabinet knew about the expenditure. Ngakaagae also requires him to produce all documentation received by his office. Regarding the transaction and further to all discussions regarding the matter. “He will further be required to testify on why, if at all, Kgosi was ever reprimanded or punished for the alleged expenditure and its status in so far as it obtained under the then administration.”

Eric Molale

As the then minister to which security agencies including the DIS report, he is expected to testify fully on all matters regarding the transaction and expenditure.

Sadique Kebonang

As the former minister for the ministry to which the funds were sourced, he is alleged to have authorised the variation of the funds in dispute. He is best placed to speak on the genesis of the procurement from strategic fuel storage reserves to the ultimate expenditure-according to Ngakaagae.

Moipedi Nkoane

She is required to answer on all meetings that she attended with clients regarding the transaction and disbursements as the DIS director Finance.

Mordech Barashi

Dignia System representative will answer on the procurement aspect of the project and all matters incidental thereto and delivery status; To explain the relationship between the DIS and his company and the delivery status of the current contract. Last week, Kgosi, was warned and cautioned by the DCEC as a suspect and is expected to appear arraignment before the court on the same matter soon.

Initially, Kgosi was to be a star witness for the state against his alleged co-accused Bakang, Botho Leburu and Kenneth Kerekang before the then Regional Magistrate Christopher Gabanagae at the Broadhurst Magistrate Court. They were arraigned before court last year December.

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Mowana Mine to open, pay employees millions

18th January 2022
Mowana Mine

Mowana Copper Mine in Dukwi will finally pay its former employees a total amount of P23, 789, 984.00 end of this month. For over three years Mowana Copper Mine has been under judicial management. Updating members, Botswana Mine Workers Union (BMWU) Executive Secretary Kitso Phiri this week said the High Court issued an order for the implementation of the compromise scheme of December 9, 2021 and this was to be done within 30 days after court order.

“Therefore payment of benefits under the scheme including those owed to Messina Copper Botswana employees should be effected sometime in January latest end of January 2022,” Kitso said. Kitso also explained that cash settlement will be 30 percent of the total Messina Copper Botswana estate and negotiated estate is $3,233,000 (about P35, 563,000).

Messina Copper was placed under liquidation and was thereafter acquired by Leboam Holdings to operate Mowana Mine. Leboam Holdings struck a deal with the Messina Copper’s liquidator who became a shareholder of Leboam Holdings. Leboam Holdings could not service its debts and its creditors placed it under provisional judicial management on December 18, 2018 and in judicial management on February 28, 2019.

A new company Max Power expressed interest to acquire the mining operations. It offered to take over the Mowana Mine from Leboam Holdings, however, the company had to pay the debts of Leboam including monies owed to Messina Copper, being employees benefits and other debts owed to other creditors.

The monies, were agreed to be paid through a scheme of compromise proposed by Max Power, being a negotiated payment schedule, which was subject to the financial ability of the new owners. “On December 9, 2021, Messina Copper liquidator, called a meeting of creditors, which the BMWU on behalf of its members (former Messina Copper employees) attended, to seek mandate from creditors to proceed with a proposed settlement for Messina Copper on the scheme of compromise. It is important to note that employee benefits are regarded as preferential credit, meaning once a scheme is approved they are paid first.”

Negotiated estate is P35, 563,000

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Councilors’ benefits debacle-savingram reveals detail

18th January 2022

A savingram the Ministry of Local Government and Rural Development sent to Town Clerks and Council Secretaries explaining why councilors across the country should not have access to their terminal benefits before end of their term has been revealed.

The contents of the savingram came out in the wake of a war of words between counselors and the Ministry of Local Government and Rural Development. The councilors through the Botswana Association of Local Authorities (BALA) accuse the Ministry of refusing to allow them to have access to their terminal benefits before end of their term.

This has since been denied by the Ministry.  In the savingram to town councils and council secretaries across the country, Permanent Secretary in the Ministry of Local Government and Rural Development Molefi Keaja states that, “Kindly be advised that the terminal benefits budget is made during the final year of term of office for Honorable Councilors.”  Keaja reminded town clerks and council secretaries that, “The nominal budget Councils make each and every financial year is to cater for events where a Councilor’s term of office ends before the statutory time due to death, resignation or any other reason.”

The savingram also goes into detail about why the government had in the past allowed councilors to have access to their terminal benefits before the end of their term.  “Regarding the special dispensation made in the 2014-2019, it should be noted that the advance was granted because at that time there was an approved budget for terminal benefits during the financial year,” explained Keaja.  He added that, “Town Clerks/Council Secretaries made discretions depending on the liquidity position of Councils which attracted a lot of audit queries.”

Keaja also revealed that councils across the country were struggling financially and therefore if they were to grant councilors access to their terminal benefits, this could leave their in a dire financial situation.  Given the fact that Local Authorities currently have cash flow problems and budgetary constraints, it is not advisable to grant terminal benefits advance as it would only serve to compound the liquidity problems of councils.

It is understood that the Ministry was inundated with calls from some Councils as they sought clarification regarding access to their terminal benefits. The Ministry fears that should councils pay out the terminal benefits this would affect their coffers as the government spends a lot on councilors salaries.

Reports show that apart from elected councilors, the government spends at least P6, 577, 746, 00 on nominated councilors across the country as their monthly salaries. Former Assistant Minister of Local Government and Rural Development, Botlogile Tshireletso once told Parliament that in total there are 113 nominated councilors and their salaries per a year add up to P78, 933,16.00. She added that their projected gratuity is P9, 866,646.00.

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Households spending to drive economic recovery

17th January 2022

A surge in consumer spending is expected to be a key driver of Botswana’s economic recovery, according to recent projections by Fitch Solutions. Fitch Solutions said it forecasts household spending in Botswana to grow by a real rate of 5.9% in 2022.

The bullish Fitch Solutions noted that “This is a considerable deceleration from 9.4% growth estimated in 2021, it comes mainly from the base effects of the contraction of 2.5% recorded in 2020,” adding that, “We project total household spending (in real terms) to reach BWP59.9bn (USD8.8bn) in 2022, increasing from BWP56.5bn (USD8.3bn) in 2021.”  According to Fitch Solutions, this is higher than the pre-Covid-19 total household spending (in real terms) of P53.0 billion (USD7.8bn) in 2019 and it indicates a full recovery in consumer spending.

“We forecast real household spending to grow by 5.9% in 2022, decelerating from the estimated growth of 9.4% in 2021. We note that the Covid-19 pandemic and the related restrictions on economic activity resulted in real household spending contracting by 2.5% in 2020, creating a lower base for spending to grow from in 2021 and 2022,” Fitch Solutions says.

Total household spending (in real terms), the agency says, will increase in 2022 when compared to 2021. In 2021 and 2022, total household spending (in real terms) will be above the pre-Covid-19 levels in 2019, indicating a full recovery in consumer spending, says Fitch Solutions.  It says as of December 6 2021 (latest data available), 38.4% of people in Botswana have received at least one vaccine dose, while this is relatively low it is higher than Africa average of 11.3%.

“The emergence of new Covid-19 variants such as Omicron, which was first detected in the country in November 2021, poses a downside risk to our outlook for consumer spending, particularly as a large proportion of the country’s population is unvaccinated and this could result in stricter measures being implemented once again,” says Fitch Solutions.

Growth will ease in 2022, Fitch Solution says. “Our forecast for an improvement in consumer spending in Botswana in 2022 is in line with our Country Risk team’s forecast that the economy will grow by a real rate of 5.3% over 2022, from an estimated 12.5% growth in 2021 as the low base effects from 2020 dissipate,” it says.

Fitch Solutions notes that “Our Country Risk team expects private consumption to be the main driver of Botswana’s economic growth in 2022, as disposable incomes and the labour market continue to recover from the impacts of the Covid-19 pandemic.”
It says Botswana’s tourism sector has been negatively impacted by the Covid-19 pandemic and the related travel restrictions.

According to Fitch Solutions, “The emergence of the Omicron variant, which was first detected in November 2021, has resulted in travel bans being implemented on Southern African countries such as South Africa, Botswana, Lesotho, Namibia, Zimbabwe and Eswatini. This will further delay the recovery of Botswana’s tourism sector in 2021 and early 2022.”  Fitch Solutions, therefore, forecasts Botswana’s tourist arrivals to grow by 81.2% in 2022, from an estimated contraction of 40.3% in 2021.

It notes that the 72.4% contraction in 2020 has created a low base for tourist arrivals to grow from.  “The rollout of vaccines in South Africa and its key source markets will aid the recovery of the tourism sector over the coming months and this bodes well for the employment and incomes of people employed in the hospitality industry, particularly restaurants and hotels as well as recreation and culture businesses,” the report says.

Fitch Solutions further notes that with economies reopening, consumers are demanding products that they had little access to over the previous year. However, manufacturers are facing several problems.  It says supply chain issues and bottlenecks are resulting in consumer goods shortages, feeding through into supply-side inflation.  Fitch Solutions believes the global semiconductor shortage will continue into 2022, putting the pressure on the supply of several consumer goods.

It says the spread of the Delta variant is upending factory production in Asia, disrupting shipping and posing more shocks to the world economy. Similarly, manufacturers are facing shortages of key components and higher raw materials costs, the report says adding that while this is somewhat restricted to consumer goods, there is a high risk that this feeds through into more consumer services over the 2022 year.

“Our global view for a notable recovery in consumer spending relies on the ability of authorities to vaccinate a large enough proportion of their populations and thereby experience a notable drop in Covid-19 infections and a decline in hospitalisation rates,” says Fitch Solutions.
Both these factors, it says, will lead to governments gradually lifting restrictions, which will boost consumer confidence and retail sales.

“As of December 6 2021, 38.4% of people in Botswana have received at least one vaccine dose. While this is low, it is higher than the Africa average of 11.3%. The vaccines being administered in Botswana include Pfizer-BioNTech, Sinovac and Johnson & Johnson. We believe that a successful vaccine rollout will aid the country’s consumer spending recovery,” says Fitch Solutions.  Therefore, the agency says, “Our forecasts account for risks that are highly likely to play out in 2022, including the easing of government support. However, if other risks start to play out, this may lead to forecast revisions.”

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