It appears there is light at end of the tunnel in the mining sector (base metals) as Botswana moves to dilute the dominance of the traditional diamond subsector. Mining is Botswana’s largest sector by revenue generation and the country’s largest private employer.
In the 2017/18 financial year Government collected over 17 billion pula from royalties and dividends while by March 2018 over 16 000 people were employed in the mining industry. The sector will remain the country’s economic anchor for more decades to come amid the economic diversification wave. This is because the mining sector is currently moving rigorously to diversity within itself as much as the nation is on an accelerated move to diversify economic activities away from mining.
Since the beginning of diamonds mining in the 1970s, the multibillion pula sector has been dominating mineral contribution to the country’s economy. The country has learnt it the hard way when over 10 000 direct and indirect jobs were lost in the copper mining industry from 2012 until 2016. But there is hope, experts this week pointed to the potential of the non-diamond mining industry at the annual Botswana Resource Sector Conference held in Gaborone.
The conference brought together leading mining and resources companies doing prospecting and exploration for different mineral deposits in Botswana. It emerged at the gathering that Botswana sits on a vast of economical mineralization and most valuable high grade deposits in the world. Apart from the traditional Copper-Nickel and Coal which has been complementing the lucrative diamonds sector for some years, it was also revealed that Botswana soils are also covering reserves of some of the most valuable industrial minerals.
These include among others Lead, Zinc, silver, vanadium and manganese deposits which exploration experts classify as some of the world‘s high grade reserves. When laying the foundation at the highly technical conference, Botswana Chamber of Mines Chief Executive Officer, Charles Siwawa noted that it was indeed not even over yet for controversial industries like the copper-nickel which faced a halt 2 years back due to predominantly depreciation of global commodity prices. Botswana‘s largest copper and nickel mining group BCL limited liquidated late 2016 following a series of closures of other copper mining companies.
Siwawa, an internationally recognized and seasoned mining expert told attendants at the conference that in the near future Botswana will bounce back and be recognized with the likes of DRC s and Zambias of the global copper mining industry. Meanwhile Charles Siwawa of Botswana Chamber of Mines Chief expressed that in the near future the world would look to Botswana not just for the lucrative diamonds but also for these valuable metal minerals which are mostly used for industrial purposes .
“While copper mines which initially closed due to liquidation are opening because of commodity price re-bounce, no one should undermine these aforementioned base metal deposits , these are world class reserves , your lead , Zinc and Silver , they are Botswana ‘s future of Mining industry,” he said . Siwawa noted that these metals mineralization exists in high grade deposits that would compete very well in the market for industrial uptake in global factories and heavy processing & hardware manufacturing plants.
Commenting on Siwawa’s views, Khemacau Copper Project Engineer and Country Manager, Jahannes Tsimako noted that his company was in good progress to unearth one of the valuable copper deposits in the region. Khoemacau is one of the companies exploring and moving to mine copper and other base metals in the Kalahari Copper Belt with one of their major mines being the Bosetu Mine, the company acquired the mine from Discovery Copper Botswana at a tune of $34.5 m (P343million) after the mine collapsed in 2013.
In 2016 Khoemacau was granted a mining license with Botswana Government retaining its 15 % participating interest in the Mine. Khoemacau started constructing the underground mine in March 2016. Boseto Mine is located in northwest of the country between Ghanzi, 70 km southwest of Maun. The mine is expected to produce copper and silver, on full scale operation hiring an excess of 2000 direct and indirect employees. Tsimako revealed that his company expects to mine sellable copper by first quarter of 2020.
Another major undertaking in the Kalahari Copper Belt is advanced explorations by Tshukudu Metals a subsidiary of Metal Tiger, the latter is one of the world’s reputable companies in the area of mining base metals. Kebalemogile Tau, Explorations Manager at the Ghandzi Based Tshukudu Metals enticed attendants and spoke life to the country’s future in Mining. The company is also at advanced explorations of the copper in the Kalahari belt.
Tau underscored that Botswana had a great future in Base metal mining. “The Kalahari Copper belt will give us long profitable mines with life span of 20-30 years employing thousands of our skilled and non-skilled personnel,” he said. Nigel Forrester, Chief Executive Officer of Mount Burgess Mining also revealed that his company was also on the final stages in prospecting Zinc Lead and Silver as well as Vanadium mineralization at its Kihabe reserves whose deposits spill over into Namibia. Forrester explained that his company explorations will output one of the world valuable lead and Silver mineralization.
Newly established wholly indigenous citizen owned retail chain Payless Retail (PTY) Ltd is set to partake in the first session of Botswana Stock Exchange (BSE)’s Tshipidi Mentorship Program (TMP) on Monday June 29th.
The TMP aims to train and capacitate SMEs so they can operate as corporates and eventually list on the local bourse. According to local bourse, BSE, the program aims to provide practical training to potential issuers through a comprehensive and interactive program that covers the key themes necessary to position a company to list on the BSE.
Payless Retail is a newly established supermarket chain whose mission is to become a convenient one-stop shopping destination as it is one of the Botswana oldest retailing brands. It started off as Corner Supermarket in January 1976, and to date boasts of nine stores in, among others, Gaborone, Mochudi, Molepolole and Tlokweng. Payless was recently acquired by Ellis Retail Group, which is led by businessman Elliot Moshoke.
The takeover catapulted Ellis Retail to the envious position of being the first wholly indigenous owned major retail chain. “We jumped at this opportunity because it gave us a chance to prove to Batswana that the retail business is open and lucrative.”
The objective is to create a proudly Botswana retail chain that fully supports our national Vision, economic development and citizen economic empowerment ambitions,” Moshoke told BusinessPost.
He further emphasized that Batswana are capable and able to run large scale businesses hence they need to accept invite foreign investors who will come in to support us not take the business. “Our win as Payless in the Fast Moving Consumer goods (FMCG) industry is a win for Batswana. We need their support in this difficult and challenging journey.
As you are aware, Payless is the only retail chain in the hands of Batswana ba Sekei. We need to take advantage of this to generate employment and create small businesses in retail and Agri businesses,” he explained.
The retailer has also partnered with Botswana Investment & Trade Center (BITC) on their #PushaBW campaign with a view to initiating earnest engagement with local producers to iron out bottlenecks and ensure seamless trading.
“Local producers have to be part of the phenomenal growth of the Payless brand. This will in turn facilitate employment creation and economic growth. We did this because we have the utmost respect for local manufacturers and producers,” he mentioned.
Payless is currently restocking all of its stores; a development that Moshoke says is testament to the retailer’s commitment to growing the brand and ensuring continuity of business. He further revealed that renowned retail suppliers like PST and CA Sales have reignited their trust in Payless, opening their doors for Payless as they have faith in the retailer’s new owners.
The takeover has reportedly saved more than 200 jobs and gave a new lease of life to the previously fledging Payless brand. According to a press release from the management team, the Payless work forces are also extremely excited about what the future holds. The TMP is a comprehensive and interactive program that covers the key themes necessary to position a company to list on the BSE.
The program is administered by experts within the listing ecosystem and seeks to bring the potential issuers closer to the listings advisers, investors and leaders of already listed companies. “As a strategic initiative, the BSE decided to set up this mentorship program in a bid to assist SMEs to strategize, corporatize and acclimatize in order to list to access equity finance and expand operations,” said the BSE.
The TMP will avail to SMEs practical insights, knowledge and feedback from institutional investors, increased awareness of the BSE listing requirements as well as an intimate network of advisors and CEOs of listed companies. After training, Payless will graduate with improve governance structures and better knowledge of articulating its business strategy. The retailer will also gain increased visibility through BSE marketing platforms.
Despite Covid-19 interrupting trade worldwide, exporting companies in Botswana which benefited from the Botswana Investment and Trade Centre (BITC) services realised P2.96 billion in export earnings during the period from April 2020 to March 2021.
In the preceding financial year, the sale of locally manufactured products in foreign markets had registered export revenue of P2, 427 billion against a target of P3, 211 billion BITC, which celebrates 10 years since establishment, continues to carry out several initiatives targeted towards expanding the Botswana export base in line with Botswana’s desire to be an export led economy, underpinned by a robust export promotion programme in line with the National Export Strategy.
The main products exported were swamp cruiser boats, pvc tanks and pvc pipes, ignition wiring sets, semi-precious stones, veterinary medicines, hair braids, coal, textiles (towels and t-shirts) and automobile batteries. These goods were destined mainly for South Africa, Zimbabwe, Austria, Germany, and Namibia.
With Covid-19 still a problem, BITC continues to roll out targeted virtual trade promotion missions across the SADC region with a view to seeking long-lasting market opportunities for locally manufactured products.
Recently, the Centre facilitated participation for Botswana companies at the Eastern Cape Development Council (ECDC) Virtual Export Symposium, the Botswana-Zimbabwe Virtual Trade Mission, the Botswana-Zambia Virtual Trade Mission, Botswana-South Africa Virtual Buyer/Seller Mission as well as the Botswana-Namibia Virtual Trade Mission.
BITC has introduced an e-Exporting programme aimed at assisting Botswana exporters to conduct business on several recommended e-commerce platforms. Due to the advent of COVID-19, BITC is currently promoting e-trade among companies through the establishment of e-commerce platforms and is assisting local companies to embrace digitisation by adopting e-commerce platforms to reach export markets as well as assisting local e-commerce platform developers to scale up their online marketplaces.
During the 2019/2020 financial year, BITC embarked on several initiatives targeted at growing exports in the country; facilitation of participation of local companies in international trade platforms in order to enhance export sales of local products and services into external markets.
BITC also helped in capacity development of local companies to compete in global markets and the nurturing of export awareness and culture among local manufacturers in order to enhance their skills and knowledge of export processes; and in development and implementation of trade facilitation tools that look to improve the overall ease of doing business in Botswana.
As part of building export capacity in 2019/20, six (6) companies were selected to initiate a process to be Organic and Fair Trade Certified. These companies are; Blue Pride (Pty) Ltd, Motlopi Beverages, Moringa Technology Industries (Pty) Ltd, Sleek Foods, Maungo Craft and Divine Morula.
In 2019 seven companies which were enrolled in the Botswana Exporter Development Programme were capacitated with attaining BOBS ISO 9001: 2015 certification. Three (3) companies successfully attained BOBS ISO 9001:2015 certification. These were Lithoflex (Pty) Ltd, General Packaging Industries and Power Engineering.
BITC’s annual flagship exhibition, Global Expo Botswana (GEB) to create opportunities for trade and strategic synergies between local and international companies. The Global Expo Botswana) is a premier business to business exposition that attracts FDI, expansion of domestic investment, promotion of exports of locally produced goods and services and promotion of trade between Botswana and other countries.
The portal also provides information on; measures, legal documents, and forms and procedures needed by Botswana companies that intend on doing business abroad. BITC continues to assist both potential and existing local manufacturing and service entities to realise their export ambitions. This assistance is pursued through the ambit of the Botswana Exporter Development Programme (BEDP) and the Trade Promotion Programme.
BEDP was revised in 2020 in partnership with the United Nations Development Programme (UNDP) with a vision to developing a diversified export-based economy. The programme focuses mostly on capacitating companies to reach export readiness status.
Prices for goods and services in this country continue to increase, with the latest figures from Statistics Botswana showing that in May 2022, inflation rate rose to 11.9 percent from 9.6 percent recorded in April 2022.
According to Statistics Botswana update released this week, the largest upward contributions to the annual inflation rate in May 2022 came from increase in the cost of transport (7.2 percent), housing, water, electricity, gas & other Fuels (1.4 percent), food & non-alcoholic beverages (1.1 percent) and miscellaneous goods & services (0.8 percent).
With regard to regional inflation rates between April and May 2022, the Rural Villages inflation rate went up by 2.5 percentage points, from 9.6 percent in April to 12.1 percent in May 2022, according to the government owned statistics entity.
In the monthly update the entity stated that the Urban Villages inflation rate stood at 11.8 percent in May 2022, a rise of 2.4 percentage points from the April rate of 9.4 percent, whereas the Cities & Towns inflation rate recorded an increase of 1.9 percentage points, from 9.9 percent in April to 11.8 percent in May.
Commenting on the national Consumer Price Index, the entity stated that it went up by 2.6 percent, from 120.1 in April to 123.2 in May 2022. Statisticians from the entity noted that the transport group index registered an increase of 7.3 percent, from 134.5 in April to 144.2 in May, mainly due to the rise in retail pump prices for petrol and diesel by P1.54 and P2.74 per litre respectively, which effected on the 13th of May 2022.
The food & non-alcoholic beverages group index rose by 2.6 percent, from 118.6 in April 2022 to 121.6 in May 2022 and this came as a result of increase in prices of oils & fats, vegetables, bread & cereal, mineral waters, soft drinks, fruits & vegetables juices, fish (Fresh, Chilled & Frozen) and meat (Fresh, Chilled & Frozen), according to the Statisticians.
The Statisticians said the furnishing, household equipment & routine maintenance group index rose by 1.0 percent, from 111.6 in April 2022 to 112.7 in May 2022 and this was attributed to a general increase in prices of household appliances, glassware, tableware & household utensils and goods & services for household maintenance.
The prices for clothing & footwear group index moved from 109.4 to 110.4, registering a rise of 0.9 percent during the period under review. Bank of Botswana has projected higher inflation in the short term, associated with the likelihood of further increases in domestic fuel prices in response to persistent high international oil prices and added that the possible increase in public service salaries could add also upward pressure to inflation in this country.