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MITI pushes for cooperatives transformation

In a bid to unearth communities’ economic potential as well as push citizen economic empowerment, the Ministry of Investment Trade & Industry (MITI) has unleashed a strategy to transform cooperative societies as a key vehicle in the eradication of poverty and job creation.

MITI through its Department for Co-operative Development continues to implement the Co-operative Transformation Strategy, with a view to revamp and resuscitate Co-operatives to become competitive, profitable, viable and sustainable business enterprise.
There are currently 271 Registered Co-operative Societies (financial and non-financial) across the Country employing over 130 people.

The Minister of Investment Trade & Industry, Bogolo Kenewendo underscored the importance of cooperatives societies in her ministry‘s mandate when addressing a series of Kgotla Meetings in Ngamiland recently. She said her ministry continues to develop and implement initiatives geared towards Co-operative Growth, capacity building, diversification and sustainability.

“The Co-operative movement, globally and locally have been urged to commit in the fulfillment of the Millennium Development Goal number one  of eradicating extreme poverty and hunger by focusing on revival of the agricultural Co-operatives,” she said.
Generally cooperatives have been the anchor of community development in Botswana even at pre-independence transition. During the post colonial epoch, cooperatives and community syndicate business models became the pillar of Botswana’s economic growth especially in the areas of Agriculture.

However as modern means of economic survival took shape the concept of cooperatives hit diminishing trends. It is only of late that the government of Botswana decided to take deliberate action towards revitalization cooperative societies and community business models into significant economic role players. Early this year local cooperative societies began a process to build a centralized digital database of their operations to reduce setbacks and financial losses.

The initial processes of the system development, dubbed, “All Cooperatives Management Information Solution (CoopMIS),” are already underway with the project expected to start soon. Kenewendo said that cooperatives needed to embrace good governance, business acumen mentality and robust winning strategies for their success. “The cooperative sector shows growth, not only in number, but in value as well. This is demonstrated by the level of investment, employment created and the benefits to the membership,” she said

Cooperative movement around the world is increasingly being promoted by international development organizations as a means to enhancing participatory and inclusive development. This is a result of the participatory nature of cooperatives that embrace communities’ investment that promotes multiple growth opportunities. Besides providing means for economic growth, cooperatives also provide an opportunity for empowerment of local communities, socially and economically. Financial cooperatives such as Savings and Credit Co-operative Society (SACCOS) are also very pivotal in today‘s economic growth and diversification quest.

Observers note that as Botswana seeks to divert from mineral sector dependence and develop other economic sectors for sustainable growth and consequently realize improved lives for its citizenry especially the local communities and furfural settlers financial cooperatives were key in that quest .

The entire financial sector plays a crucial role realizing this, specifically in resource mobilization and raising capital for investment and development of other sectors such as property & real estate, agriculture, manufacturing, tourism and hospitality. Apart from the banking sector which is fragile and vulnerable to economic uncertainties the financial sector is significantly boosted by the pension funds, capital and asserts management industry with Botswana’s largest fund, BPOPF playing a major role and taking the lead in wealth accumulation.

THE SACCOS MODEL

Of recent Savings and Credit Co-operative Society (SACCOS) movement has also been establishing itself as significant segment of the non-banking financial sector. SACCOS is a self-help and self-reliant democratically member-driven financial co-operative, owned, governed and managed by members with a common bond or common economic need.

 It is a very integral wealth accumulation tool that can boost the financial sector in funding developmental undertakings   like infrastructure, capacity building & human resources development, research & innovation and consequently birth economic growth as well as the much needed diversification.

Mr Boniface Tsheko Deputy Director in the Department of Co-operative Development under the Ministry of Investment Trade & Industry (MITI) describes SACCOS as a non banking financial institutions set up by people who want to solve a common problem for themselves and is managed by themselves.

This may include people working for the same employer, belonging to the same labour union, social fraternity, or living in the same community. The SADC region has over 6 000 registered SACCOS with a total membership of 1.6 million and an asset base of over US$823 million.

Of this, the contribution of Botswana to the stated statistics is 64 registered SACCOS while membership is over 25 000 and an asset base of over US$9 million. SACCO’s members agree to pool their resources together and grant loans to one another at reasonable rates.

This model allows members to benefit from higher returns on savings, lower interest rates on loans and low bank and finance charges on average. SACCOS helps members create opportunities such as starting small businesses, growing farms, building family homes and educating their children and other domestic needs, without unending state of dependency.

Under informal and non registered operations ordinary Batswana gather up funds and lend money amongst themselves on interest basis to expand the fund and later split after an agreed period of time. This financial syndicate model popularly known as ‘’Motshelo’’ is unregulated but gathers Batswana especially low income earners significant capital for their household requisite and small business. Motshelo has established itself as a form of cooperative financial platform key to resources and funds mobilization for Batswana.

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China’s GDP expands 3% in 2022 despite various pressures

2nd February 2023
China’s Gross Domestic Product (GDP) expanded by 3% year-on-year to 121.02 trillion yuan ($17.93 trillion) in 2022 despite being mired in various growth pressures, according to data from the National Bureau Statistics.

The annual growth rate beat a median economist forecast of 2.8% as polled by Reuters. The country’s fourth-quarter GDP growth of 2.9% also surpassed expectations for a 1.8% increase.

In 2022, the Chinese economy encountered more difficulties and challenges than was expected amid a complex domestic and international situation. However, NBS said economic growth stabilized after various measures were taken to shore up growth.

Industrial output rose 3.6% in 2022 over the previous year, while retail sales slightly shrank by 0.2% data show that fixed-asset investment increased 5.1% over 2021, with a 9.1% hike in manufacturing investment but a 10% fall in property investment.

China created 12.06 million new jobs in urban regions throughout the year, surpassing its annual target of 11 million, and officials have stressed the importance of continuing an employment-first policy in 2023.

Meanwhile, China tourism market is a step closer to robust recovery. Tourism operators are in high spirits because the market saw a good chance of a robust recovery during the Spring Festival holiday amid relaxed COVID-19 travel policies.

On January 27, the last day of the seven-day break, the Ministry of Culture and Tourism published an encouraging performance report of the tourism market. It said that domestic destinations and attractions received 308 million visits, up 23.1% year-on-year. The number is roughly 88.6% of that in 2019, they year before the pandemic hit.

According to the report, tourism-related revenue generated during the seven-day period was about 375.8 billion yuan ($55.41 billion), a year-on-year rise of 30%. The revenue was about 73% of that in 2019, the Ministry said.

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Jewellery manufacturing plant to create over 100 jobs

30th January 2023

The state of the art jewellery manufacturing plant that has been set up by international diamond and cutting company, KGK Diamonds Botswana will create over 100 jobs, of which 89 percent will be localized.

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Investors inject capital into Tsodilo Resources Company

25th January 2023

Local diamond and metal exploration company Tsodilo Resources Limited has negotiated a non-brokered private placement of 2,200, 914 units of the company at a price per unit of 0.20 US Dollars, which will provide gross proceeds to the company in the amount of C$440, 188. 20.

According to a statement from the group, proceeds from the private placement will be used for the betterment of the Xaudum iron formation project in Botswana and general corporate purposes.

The statement says every unit of the company will consist of a common share in the capital of the company and one Common Share purchase warrant of the company.

Each warrant will enable a holder to make a single purchase for the period of 24 months at an amount of $0.20. As per regularity requirements, the group indicates that the common shares and warrants will be subject to a four month plus a day hold period from date of closure.

Tsodilo is exempt from the formal valuation and minority shareholder approval requirements. This is for the reason that the fair market value of the private placement, insofar as it involves the director, is not more than 25% of the company’s market capitalization.

Tsodilo Resources Limited is an international diamond and metals exploration company engaged in the search for economic diamond and metal deposits at its Bosoto Limited and Gcwihaba Resources projects in Botswana.  The company has a 100% stake in Bosoto which holds the BK16 kimberlite project in the Orapa Kimberlite Field (OKF) in Botswana.

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