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Half billion pula gone as Chinese raided Gov’t coffers

The Fengyue Glass project shenanigans are refusing to go away, especially after Specially Elected Member of Parliament, Mephato Reatile took aim at the imbalance demonstrable in the sale of the failed plant equipment and 100 hectares of land. But Government has indicated that it was well aware that it will never recover the P500 million gobbled by the briefcase Chinese company behind the glass project.

The inquisitive legislator had asked the Minister of Trade Industry and Investment whether in view of approximately half a billion Pula of public revenues expended on the Botswana Development Corporation (BDC) Fengyue Glass Manufacturing Plant in Palapye, due regard was made by his Ministry in its decision to sell the Plant for the price for which it was sold by the Liquidator. Reatile also wanted to know how much the 100 hectares of the Plant consisting of a glass producing Plant, Power Sub-Station and the Railway Spur was sold for; and how much was realised after the sale of the 100 hectares of the Fengyue Glass Manufacturing Industrial Estates.

Responding directly to Reatile, Assistant Minister, Biggie Butale indicated that in November 2013, the Board of BDC resolved to place Fengyue Glass Manufacturing Botswana (Pty) Ltd under liquidation and a provisional liquidator was appointed. “Liquidation is a process by which a company is dissolved or wound up, and the assets and properties of the company are sold and the proceeds thereof redistributed to shareholders,” he explained.

The Minister apportioned all blame to the liquidator: “the liquidator is responsible for the process of winding up the company which includes receiving all claims from creditors as well as the distribution of assets. The liquidator works under the supervision of the Master of the High Court. As such, BDC as a company nor my Ministry had any control or influence over this process.”

However, Butale confirmed that BDC spent half a billion Pula on the project, but stated that it was not possible to recover the money. “Whilst it is acknowledged that BDC spent half a billion Pula through its investment of debt, equity and purchase of the assets of the Fengyue Glass Manufacturing Plant in Palapye, it should be made clear that it was unlikely that the Corporation would recover the capital invested.”

Further, the minister said the sale conducted by the Liquidator was not in respect of the business and equity. “On the contrary, the sale was in respect of the assets of the company. I should however indicate that a credible, auditable and fair process was used by the Liquidator to value the assets of the entity prior to the sale. The assets of the entity were in this regard valued by a Certified Professional Valuer.” He said the valuation report demonstrated that the technical equipment to be sold was either used, incomplete, considerably deteriorated and/or certainly out of any possible warranty by the manufacturer or the supplier.

Butale the liquidator opted for an online auction to maximise recoveries hence ensuring that as many local and international bidders would have access to the sale. According to the Minister, the auction attracted a total of 2 713 bids of which 60 per cent or 1 628 were from Botswana bidders.

He further indicated that the Ministry could not have any say in the amount to be realised from the sale of Fengyue Glass Manufacturing Plant’s assets through the sale process.  The junior minister said following a valuation of the assets as explained above, the land, plant, power station and railway spur were sold for the sum of P54 382 000.00 inclusive of Value Added Tax. “What remained following the sale of 110 hectares of Fengyue Glass Manufacturing Industrial Estate was sold for P50 million, these being the movable assets.”

Warren Schewitz’s company was awarded an auction by KPMG for the sale of Fengyue Glass Plant. This publication has established that every bidder who participated was FICA registered and had paid a refundable P5000 deposit. In total there were 2 713 bids placed on 79 assets with an average of 34 bids per asset. Weekend Post understands that following the auction, two high bidders, namely G4 Consulting Engineers and Sable Transport of Zambia failed to pay despite numerous and vigorous correspondence. It has been verified that both actually attended the viewing day and wanted to bid for the entire plant and as such bid extensively on almost every item.

In the first planned auction in 2015, no buyers had shown interest in purchasing the BDC’s Fengyue Glass Manufacturing plant. The plant, situated in Palapye, was sold after the project collapsed amid allegations of corruption and was put under liquidation. The Fengyue glass project was expected to create hundreds of jobs for residents of Palapye and surrounding areas. Amongst the company assets that were up for auction is a float glass plant and equipment. An advert on the sale indicates that the float glass is designed to have a daily melting capacity of 450 tonnes of molten glass and designed in compliance with the China Louyang Float Glass Standards.  The majority of the plant and equipment remained in its original packaging. A list of other goods that are on site has been prepared by the contractor, though it has not been independently checked or verified.

The plant also boasts of a 100 hectare piece of land close to the centre of Palapye and has a dedicated electricity substation with a railway spur. Of the area, 1,000 m by 600m has been fenced. There are also 11 temporary accommodation blocks on site. But these have been temporarily rented out to a third party for a period of two years with 18 months remaining on the lease.

Civil engineering works had commenced on most of the plant and required utilities buildings with the foundations been laid. Also, varying degrees of civil steel and concrete had been completed, though the exact level of completeness is not known. The advert further stated that there are also construction plant and equipment consisting of small tools and heavy plant equipment and machinery, as well as assets from office and accommodation blocks for construction workers. The oxygen plant is believed to be complete and the oxygen is on site but in a self-contained area. The oxygen plant consists of three independent buildings outside the area of the plant, but access to it can only be gained through the main entrance of the plant.

Minister recognizes the BDC journey

This is how Assistant Minister Butale began his response to Reatile’s question: “BDC is a company limited by guarantee which was registered on the 15th April 1970. The company has played a pivotal role in pioneering growth in a number of sectors such as; Aviation with Air Botswana, Car rental with Avis Property Development, Hospitality through Cresta Group of Hotels. BDC has led the industrial development drive of Botswana through the likes of; Sechaba Breweries, Nortex Industries, Kromberg and Schubert, Kwena Rocla and Can Manufacturers.

These companies have been important in the creation of sustainable employment for Batswana. Having started off with an investment base of R20 000.00, BDC now has an asset base of P4.2 Billion. Mr Speaker, let me now respond to the Honourable Member’s specific question on the Fengyue Glass project.” The Minister wants the role BDC played in the past in industrialization and employment creation to be recognized, instead of the Fengyue blemish.

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P500 million Tshesebe-Masunga road dispute lands in Court

25th January 2021
500-Million-Tshesebe-Masunga-road-on-a-stand-still

The Tshesebe-Mosojane-Masunga road estimated costs stand at P500 million, the tender which was awarded to Bash Carriers in 2017 has not taken shape four years after the project was commissioned.

Tshesebe-Mosojane-Masunga road when it was commissioned, was estimated at P500 million in value, this included construction of 22.50km of the two lane carriage way and 28.70km of access roads including associated bridge works, cross drainage works, storm water drainage works and relocation of services.

When it was first tendered the contract was awarded to Bash Couriers but was terminated after it was alleged that the contractor failed to deliver. It was said that Bash Couriers Construction Company was lagging behind schedule.

This publication visited the sites of Tshesebe-Masunga road last year December and it was evident that the project was at a standstill as deserted machinery on site could be seen with the gravel road also in a devastating state.

Information revealed then indicated that there had been issues of mining rights for aggregates, availability of structural engineers and manpower and a criteria for awarding tender to the specific company when the contract was terminated.

In 2016, as part of the ESP projects, government funded the 25 kilometres (Km) road project to link Tshesebe and Masunga.

Construction of the road, which also connects some of the villages within the district, commenced early in 2016 and was scheduled to be completed within 18 months.

The company had done nothing when their contract was terminated with allegations that it never had the capacity to carry out the project in the first place.

The major ESP project had ultimately robbed a lot of people potential employment when it succumbed to termination.

It was then that the government restarted the tendering process.

The project was awarded to Bango Trading Company and Zebra Construction in a joint venture at a value of P319 Million Pula.

However, information reaching this publication from the Ministry of Transport and Communications confirms that indeed there are no current works carried out on the Tshesebe Masunga road.

Responding to a questionnaire sent to them by this publication through their Public Relations Officer Doreen Moapare, the Ministry indicated that the Tshesebe-Masunga road project is before the courts therefore their response is limited by such a pending outcome.

“As a background the project had been awarded to Bash Carriers at a contract sum of P400, 044,365.68 to begin the works in May 2017 and complete the project in January 2019. Scopes of works included 51.2km main road inclusive of seven access roads. Due to non-performance, Bash Carriers contract was terminated on the 25th of September 2018. ”

Further, Moapare indicated that upon termination of Bash Carriers, a process began to ensure that the development project completes.

Five companies went for a selective tendering bid which she listed as; Lobkom Investments (Pty) Ltd, Landmark (Pty) Ltd and Truck Hire (Pty) Ltd Joint venture, ACE /Excavator Hire (Pty) Ltd and Asphalt Botswana (Pty) Ltd Joint venture, Cul De Sac, Bango Trading and Zebra Construction Joint venture.

“Some companies have since queried the results of the tendering adjudication landing the issue in the courts. We are currently awaiting a ruling expected in February/March 2021, and this will determine the course of action thereafter,” concluded Moapare.

At one point last year, reports indicated that Bango Trading Construction Company had faced raiding by the Directorate on Intelligence and Security, Botswana Police and Botswana Unified Revenue Services, with allegations that there was an emerging pattern targeting overscheduled construction companies with powerful political connections.

Bango Trading Managing Director, Moffat James, was reported to have had close links to former DIS Director Isaac Seabelo Kgosi. Bango Trading and Estate Construction Company which has obtained close to P 1, 5 billion government contracts under former President Lt Gen Ian Khama has been the subject of a parliamentary probe due to the many government contracts awarded to them.

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DPP halts JSC, Judge’s back to work plan

25th January 2021
Kebonang

The Directorate of Public Prosecutions (DPP)’s decision to reject and appeal the High Court’s verdict on a case involving High Court Judge, Dr Zein Kebonang has frustrated the Judicial Service Commission (JSC) and Judge Kebonang’s back to work discussions.

JSC and Kebonang have been in constant discussions over the latter’s return to work following a ruling by a High Court panel of judges clearing him of any wrong doing in the National Petroleum Fund criminal case filed by the DPP. However the finalization of the matter has been hanged on whether the DPP will appeal the matter or not – the prosecution body has since appealed.

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BDP rejects Saleshando payment proposal

25th January 2021
MP saleshando

Botswana Democratic Party (BDP) top brass has declined a request by Umbrella for Democratic Change (UDC) to negotiate the legal fees occasioned by 2019 general elections petition in which the latter disputed in court the outcome of the elections.

This publication is made aware that UDC Vice President Dumelang Saleshando was left with an egg on his face after the BDP big wigs, comprising of party Chairman Slumber Tsogwane and Secretary General Mpho Balopi rejected his plea.

“He was told that this is a legal matter and therefore their (UDC) lawyer should engage ours (BDP) for negotiations because it is way far from our jurisdiction,” BDP Head of Communications, Kagelelo Kentse, told this publication.

This spelt doom for the main opposition party and Saleshando who seems not to have confidence and that the UDC lawyers have the dexterity to negotiate these kind of matters. It is not clear whether Saleshando requested UDC lawyer Boingotlo Toteng to sit at the table with Bogopa Manewe, Tobedza and Co, who are representing the BDP to strike a deal as per the BDP top echelons suggested.

“From my understanding, the matter is dealt with politically as the two parties are negotiating how to resolve it, but by far nothing has come to me on the matter. So I believe they are still substantively engaging each other,” Toteng said briefly in an interview on Thursday.

UDC petitioners saddled with costs after mounting an unprecedented legal suit before the court to try and overturn BDP’s October 2019 victory. The participants in the legal matter involves 15 parliamentary candidates’ and nine councillors. The UDC petitioned the court and contested the outcome of the elections citing “irregularities in some of the constituencies”.

In a brief ruling in January 2020, Judge President Ian Kirby on behalf of a five-member panel said: “We have no jurisdiction to entertain these appeals. These appeals must be struck out each with costs including costs of counsel”. This was a second blow to the UDC in about a month after their 2019 appeals were dismissed by the High Court a day before Christmas Day.

This week BDP attorneys decided to attach UDC petitioners’ property in a bid to settle the debts. UDC President Duma Boko is among those that will see their property being attached with 14 of his party members. “We have attached some and we are on course. So far, Dr. Mpho Pheko (who contested Gaborone Central) and that of Dr, Micus Chimbombi (who contested Kgalagadi South) will have their assets being sold on the 5th of February 2021,” BDP attorney Basimane Bogopa said.

Asked whether they met with UDC lawyers to try solve the matter, Bogopa said no and added. “Remember we are trying to raise the client’s funds, so after these two others will follow. Right now we are just prioritising those from Court of Appeal, as soon as the high court is done with taxation we will attach.”

Saleshando, when contacted about the outcomes of the meeting with the BDP, told WeekendPost that: “It would not be proper and procedural for me to tell you about the meeting outcomes before I share with UDC National Executive Committee (NEC), so I will have to brief them first.”

UDC NEC will meet on the 20th of next month to deal with a number of thorny issues including settling the legal fees. Negotiations with other opposition parties- Alliance for Progressives and Botswana Patriotic Front (BPF) are also on the agenda.

Currently, UDC has raised P44 238 of the P565 000 needed to cover bills from the Court of Appeal (CoA). This is the amount in a UDC trust account which is paltry funds equating 7.8 per cent of the overall required money. In the past despite the petitioners maintaining that there was promise to assist them to settle legal fees, UDC Spokesperson, Moeti Mohwasa then said the party has never agreed in no way to help them.

“We have just been put in debt by someone,” one of the petitioners told this publication in the past. “President’s (Duma Boko) message was clear at the beginning that money has been sourced somewhere to help with the whole process but now we are here there is nothing and we are just running around trying to make ends meet and pay,” added the petitioner in an interview
UDC NEC has in December last year directed all the 57 constituencies to each raise a minimum of P10, 000. The funds will be used to settle debts that are currently engulfing the petitioners with Sheriffs, who are already hovering around ready to attach their assets.

The petitioners, despite the party intervention, have every right to worry. “This is so because ‘the deadline for this initiative (P10, 000 per constituency) is the end of the first quarter of this year (2021),” a period in which the sheriffs would have long auctioned the properties.

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