Botswana Investment & Trade Center (BITC) has recorded a 16 % overall performance decline for their operational year 2016/17, the orghanisation’s annual report released last week has revealed.
According to the report, BITC, which operates as a parastatal under the Ministry of Investment Trade & Industry (MITI) registered an overall performance of 74 %, the assessment is predominantly reliant on corporate delivery and return on investment – which takes appreciation of the BITC mandate and purpose. The 74 percent reflects a 16 percent performance decline compared to the 90 % realized in the 2015/16 year.
BITC solicited an excess of 3 billon pula in capital investment for the period under review taking the total of investment capitalization to over P10 billion since inception as reported by President Lt Gen Dr Ian Khama in his State of the Nation Address(SONA) in November last year. “Our targeted investment promotion efforts resulted in a total capital investment of P3.08 billion,” reads the report.
According to the investment promotion arm the total capital investment achieved is attributed to Foreign Direct Investment (FDI) companies which contributed P1.5 billion, while business expansions injected P618 million; and a domestic investments of P964 million was realized. The Financial and Business Services sector, which is one of priority sectors under BITC investment promotion mandate delivered a whooping P901.5 million, accounting for 29.24% of the total capital investment realized.
Reaffirming President Khama’s SONA words ,BITC states that total employment of 3156 jobs resulted from these investments, which is an increment compared to 1709 jobs recorded in the 2015/16 operating year. “The majority of jobs were created through Domestic Investment and Expansions (2208), while FDI registered 948 jobs,” reveals the report.
To promote an export led economy, the BITC has established an export portfolio which is managed by the export promotion department. This is a very important segment of the BITC mandate as it facilitates and assists Botswana companies with reaching foreign markets which is vital for business growth considering the fact that Botswana only has a population of 2 million people. According to the BITC annual report the portfolio exceeded its target of P2.22 billion, reaching an export revenue totaling P2.23 billion.
“Existing local products were exported to new markets of Zambia, Angola, Zimbabwe, DRC, Malawi, Mozambique, South Africa, Namibia, USA, Hong Kong and the European Union. In addition six (6) newly produced products were added to the export portfolio including forma packs (Namibia), aluminum windows and designs (RSA), latex male condoms (RSA), vinyl floor tiles (RSA), food cans (RSA) and Cellular phones (Mozambique),” reads the Chief Executive officer‘s statement in the annual report.
One of the key milestones last year was the launch of the One Stop Service Center which facilitates all requirements of prospective investors and foreign professionals seeking to established serious businesses in Botswana. Under this year’s review the BITC reveals that there were 381 government authorizations, out of which a total of 307 were approved. “The rejection rate at the BITC One Stop Shop stood at 6.6% in 2016/2017; we have made proposals to Government to create a Business Immigration Selection Board to make our work and residence processes and outcomes more predictable and with greater certainty.”
“We continue to monitor and are alert to the competitiveness of competing African countries. Countries such as Mauritius and Rwanda lead the pack in providing a more conducive business climate and thus competitive environment for attracting investors. The Ministry of Investment, Trade and Industry, through the BITC’s advocacy is working on enacting a Business Facilitation Law, which will look to confer a higher degree of predictability and certainty to outcomes with respect to all government authorizations.”
The issue of immigration policies and work and residence permit rejection has been noted by stakeholders and investment as a possible deterrent and sabotaging factor to Botswana‘s FDI efforts. This is so as asserted by speakers in different platforms that Botswana has considerable good economic & political environment but still ranks behind poor governed countries such the DRC and Mozambique in attracting foreign investors.
Chairman of the BITC Board, seasoned investment executive, Victor Senye, now a business man shared that his organization adopted a move towards a new strategic direction to drive performance and efficiency in approach. “This would look towards linking our corporate structure and aligning it to the new strategy, reviewing our on the-ground personnel to ensure that we have the right people with the appropriate skills to engage with our varied investors, as well as considering appointment of specialist private sector advisory counsel to the Board,” he said. Senye revealed that BITC will continue to inspect the markets and review the investment requisites and make well informed recommendations to Government.
Parastatals and government agencies especially those that solely and/or heavily depend on government funding for operation are scrutinized time and again for lavish expenditures and less return on investment. Although the organization declined in performance, BITC has by far surpassed the annually monetary resources injected by taxpayers in the form of subvention funds as over P3 billion worth of business transaction was solicited.
However as of March 2017 BITC realized a deficit of P 20,784,835 which is largely contributed by Investment Property fair value loss amounting to P 29,314,072. According to the report the BITC Gaborone West Industrial factory shells alone realized a loss in value of P 8, 550,000 as a result of the subdued rental market.
“The overall subvention was yet again reduced by 1% during the financial year under review, which was geared towards alleviation of the financial meltdown of BCL. The more integrated approach to financing marketing and promotional activities contributed to the improvement in operational efficiencies and budget utilization was optimized at 95%, with a deficit of P 20,784,835 as at 31st March 2017.”
BITC is reliant on Government funding with an opportunity to generate a target of 15% of its budget requirement from internally generated sources such as the rental of factory shells and global expo income. For the year under review, the center managed to generate 16% from internal sources to meet its budgetary requirements. In the financial year ended March 2017, BITC was allocated a total subvention of P98, 830,560 which was reduced by 1% during the year by Government. BITC spent P52,362,408 on employees’ remuneration and over P8 million on the 2016 Global Expo amongst other expenses.
BITC was established by Government in 2012 as a merger of BEDIA and other business facilitation agencies, the organization is mandated and tasked with investment facilitation, promotion of private sector involvement as well as development of conducive environment for easy of doing business amongst others all in a bid to realize export led, diversified and significantly growing economy.
Joint venture between De Beers and Government of Republic of Namibia announces new plan, supporting economic, commercial, employment and community benefit, following receipt of royalty relief Namdeb Diamond Corporation (Proprietary) Limited (‘Namdeb’), a 50:50 joint venture between De Beers Group and the Government of the Republic of Namibia, today announced the approval of a new long-term business plan that will extend the current life of mine for Namibia’s land-based operations as far as 2042.
Under the previous business plan, the land-based Namdeb operations would have come to the end of their life at the end of 2022 due to unsustainable economics. However, a series of positive engagements between the Namdeb management team and the Government of the Republic of Namibia has enabled the creation of a mutually beneficial new business plan that extends the life of mine by up to 20 years, delivering positive outcomes for the Namibian economy, the Namdeb business, employees, community partners and the wider diamond industry.
As part of the plan, the Government of the Republic of Namibia has offered Namdeb royalty relief from 2021 to 2025, with the royalty rate during this period reducing from 10% to 5%. This royalty relief has in turn underpinned an economically sustainable future for Namdeb via a life of mine extension that, through the additional taxes, dividends and royalties from the extended life of mine, is forecast to generate an additional fiscal contribution for Namibia of approximately N$40 billion. Meanwhile, the life of mine extension will also deliver ongoing employment for Namdeb’s existing employees, the creation of 600 additional jobs, ongoing benefits for community partners and approximately eight million carats of additional high value production.
Bruce Cleaver, CEO, De Beers Group, said: “Namdeb, a shining example of partnership, has a proud and unique place in Namibia’s economic history. This new business plan, forged by Namdeb management and enabled by the willingness of Government to find a solution in the best interest of Namibia, means that Namdeb’s future is now secure and the company is positioned to continue making a significant contribution to the Namibian economy, the socio-economic development of the Oranjemund community and the lives of Namdeb employees.” Hon. Tom Alweendo, Minister of Mines and Energy for the Government of the Republic of Namibia, said: “Mining remains the backbone of our economy and is one of the largest employment sectors within our country.
Government understood the fundamental impact of what the Namdeb mine closure at the end of 2022 would have had on Namibia. Therefore, it was imperative to safeguard this operation for the benefit of sustaining the life of mine for both the national economy as well as preserving employment for our people and the livelihoods of families that depend on it.”
Riaan Burger, CEO, Namdeb Diamond Corporation, said: “After more than a century of production, these operations were approaching the end of their life, but the creation of this new business plan means we can continue to deliver for Namibia for many years into the future. This is great news for the hardworking women and men of Namdeb, as well as for all our community partners who we are proud to have worked with over the years. We now look forward to starting a new chapter in Namdeb’s proud history.”
Botswana has recorded its first trade surplus for 2021 since the only one for the year in January.
The country’s exports for the month of July surpassed the value of imports, Statistics Botswana’s July International Merchandise Trade data reveals.
Released last Friday, the monthly trade digest reports a positive jump in the trade balance graph against the backdrop of a series of trade deficits in the preceding months since January this year.
According to the country’s significant data body, imports for the month were valued at P7.232 billion, reflecting a decline of 6.6 percent from the revised June 2021 value of P7.739 billion.
Total exports during the same month amounted to P7.605 billion, showing an increase of 6.1 percent over the revised June 2021 value of P7.170 billion.
A trade surplus of P373.2 million was recorded in July 2021. This follows a revised trade deficit of P568.7 million for June 2021.
For the total exports value of P7.605 billion, the Diamonds group accounted for 91.2 percent (P6.936 billion), followed by Machinery & Electrical Equipment and Salt & Soda Ash with 2.2 percent (P169.7 million) and 1.3 percent (P100.9 million) respectively.
Asia was the leading destination for Botswana exports, receiving 65.2 percent (P4.96 billion) of total exports during July 2021.
These exports mostly went to the UAE and India, having received 26.3 percent (P1. 99 billion) and 18.7 percent (P1.422 billion) of total exports, respectively. The top most exported commodity to the regional block was Diamonds.
Exports destined to the European Union amounted to P1.64 billion, accounting for 21.6 percent of total exports.
Belgium received almost all exports destined to the regional union, acquiring 21.5 percent (P1.6337 billion) of total exports during the reporting period.
The Diamonds group was the leading commodity group exported to the EU. The SACU region received exports valued at P790.7 million, representing 10.4 percent of total exports.
Diamonds and Salt & Soda Ash commodity groups accounted for 37.8 percent (P298.6 million) and 6.2 percent (P48.7 million) of total exports to the customs union.
South Africa received 9.8 percent (P745.0 million) of total exports during the month under review. The Diamonds group contributed 39.9 percent (P297.4 million) to all goods destined for the country.
In terms of imports, the SACU region contributed 62.7 percent (P4.534 billion) to total imports during July.
The topmost imported commodity groups from the SACU region were Fuel; Food, Beverages & Tobacco, and Machinery & Electrical Equipment with contributions of 33.3 percent (P1.510 billion), 17.4 percent (P789.4 million) and 12.7 percent (P576.7 million) to total imports from the region, respectively.
South Africa contributed 60.1 percent (P4.3497 billion) to total imports during July 2021.
Fuel accounted for 32.1 percent (P1.394 billion) of imports from that country. Food, Beverages & Tobacco contributed 17.7 percent (P772.0 million) to imports from South Africa.
Namibia contributed 2.0 percent (P141.1 million) to the overall imports during the period under review. Fuel was the main commodity imported from that country at 82.1 percent (P115.8 million).
During the months, imports representing 63.5 percent (P4.5904 billion) were transported into the country by Road.
Transportation of imports by Rail and Air accounted for 22.7 percent (P1.645 billion) and 13.8 percent (P996.2 million), respectively.
During the month, goods exported by Air amounted to P6, 999.2 million, accounting for 92.0 percent of total exports, while those leaving the country by Road were valued at P594.2 million (7.8 percent).
Founders from twenty companies have been accepted into the program from Botswana, Namibia, and South Africa
The 4th Cohort of the Stanford Seed Transformation Program – Southern Africa (STP), a collaboration between Stanford Graduate School of Business and De Beers Group commenced classes on 20 September 2021. According to Otsile Mabeo, Vice President Corporate Affairs, De Beers Global Sightholder Sales: “We are excited to confirm that 20 companies have been accepted into the 4th Seed Transformation Programme from Botswana, Namibia, and South Africa. The STP is an important part of the De Beers Group Building Forever sustainability strategy and demonstrates our commitment to the ‘Partnering for Thriving Communities’ pillar that aims at enhancing enterprise development in countries where we operate in the Southern African region”. Jeffrey Prickett, Global Director of Stanford Seed: “Business owners and their key management team members undertake a 12-month intensive leadership program that includes sessions on strategy and finance, business ethics, and design thinking, all taught by world-renowned Stanford faculty and local business practitioners. The program is exclusively for business owners and teams of for-profit companies or for-profit social enterprises with annual company revenues of US$300,000 – US$15million.” The programme will be delivered fully virtually to comply with COVID 19 protocols. Out of the 20 companies, 6 are from Botswana, 1 Namibia, and 13 South Africa. Since the partnership’s inception, De Beers Group and Stanford Seed have supported 74 companies, 89 founders/CEOs, and approximately 750 senior-level managers to undertake the program in Southern Africa.