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Trans Kalahari Corridor under-utilized

Trans Kalahari Corridor is still untapped and underutilized by Botswana, South Africa and Namibia, this observation emerged at an interactive lecture between Trade representatives from the three countries in Gaborone recently.


It was revealed that the Trans Kalahari Corridor could unlock great commerce and trade opportunities to the three economies in the area of tourism, transport and logistics sector. Developments from the gathering suggests that existing trade  regulations and laws in the three different trade partners, Botswana, Namibia, and South Africa need to be harmonized to complement each other  and avoid contradictions.


Botswana Unified Revenue Service (BURS) General Manager, Bugalo Mudongo noted that for their part the Botswana national customs authority was on the right track to introduce innovative, digitized ways of delivering services to enhance trade and cross border business within the region.


 “The national trading window intends to link our trading partners electronically as well as interface with our neighbors. The system will also enhance efficiency of customs collection, improve security, and shorten service delivery times to actually facilitate cumbersome free cross border trade thus contributing significantly to the economies of the three counties.”  


Lesille Mpofu, an Executive from the Trans Kalahari Corridor Group revealed that some trade laws and other complementing regulations of the three countries such as transport governing guidelines contradicted each other. “It is important for us to harmonise our trade laws and polices – for example, PrDP in South Africa is eligible to 22 year olds and above; whereas in Botswana and Namibia it is applicable to 25 year olds and above, this means that when a 23 year old South African freight/ cargo operator delivers something in Botswana from South Africa, soon as they cross the border they are illegal,” he noted.


The Project Manager of Walvis Bay Corridor Group urged Botswana which is the only landlocked country amongst the three to tap into the lucrative trade opportunity presented by Walvis Bay. For his part, Clive Smith noted that the bay opens up Botswana to a gateway of over 300 million potential consumers for its goods and services. “We are a strategic location; we are a gateway to South America, North America, and Europe, that’s a huge trade opportunity worth billions and Botswana because of its landlocked geographical location can take advantage of the Trans Kalahari corridor and trade agreements by using shipping services at Walvis Bay to access the overseas market,” he said.


Namibia and Botswana governments have already signed a number of agreements on the Walvis Bay and the shortcoming has been that the depot and cargo bay is unutilized by the traders and Botswana business people. Botswana as a member of Southern African Customs Union (SACU) has several trade agreements and advantages it has and enjoys from the membership. Trans Kalahari High Way, which is a corridor that links Botswana, South Africa, and Namibia is one of the projects put up by the three governments and international partners to help enhance cross border trade in the region.


The ongoing Kazungula Bridge across the Zambezi River is a project funded by the governments of Zambia and Botswana with the assistance of international partners like Japan. Once complete, Kazungula is expected to reduce crossing time 10 times when compared to the current setup of using a pantoon. The same benefits are expected to be ripped off from the over a billion pula Mohembo bridge. Botswana has several initiatives that are aimed at improving trade regionally and internationally.


HOW THE CORRIDOR WAS CONCEIVED


The Trans-Kgalagadi Road Project (the Project) is part of a wider
Road Corridor, the Trans Kgalagadi Road Corridor, linking Botswana,
Namibia and the Republic of South Africa. Similarly to the Maputo Corridor, the Trans Kgalagadi Road Corridor has an end-point in the province of Gauteng in South Africa.


In 1991, the AfDB approved a loan totaling UA 21.5 million (comprised of an ADB loan of 13.38 million and an ADF loan of UA 8.12) to finance the section II of the Trans-Kgalagadi Road between Kang and Ghanzi districts. The project was initially designed to reduce transport costs, enhance social and economic integration of the south-western part of Botswana and facilitate economic integration with Namibia.


The Bank’s financed project has three main components: (i) civil works for the construction of 221 kms road, (ii) consulting services for sections II and III of the road, (iii) environmental protection support, and (iv) and technical assistance for the management of the project and training of road engineers and planners. The PCR was submitted in 2005 and it rated the project performance as satisfactory.


In addition to the completion of expected outputs, the project achieved cost savings of approximately UA 6.89 million which enabled the construction of the Lobatse and Kanye bypasses. In overall the project completion suffered a delay of 21 months mainly due to delays caused by the non-availability of water in the dry land of the central Kgalagadi Desert for construction which called for an investigation on construction water sources prior to the invitation of tenders, and also delays in the disbursement of funds.  Despite that, the road is technically sound and shows no major defects.


WHY THE CORRIDOR IS UNDER-UTILIZED


“ Long hours at the border posts, limitation on driving hours on the section of the highway, lack of facilities on some sections of the highway and the proximity of people and animals on the road dissuaded road users to use the highway. The unanticipated conversion of the Trans Kgalagadi Highway into a corridor was an essential measure to promote the use of the road and also to enhance regional benefits. The corridor has promoted cross-border trade and traffic as well as economic cooperation between Botswana and Namibia. The implementation of a structured corridor management committee has achieved substantial milestones in terms of customs harmonization.” 

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Matsheka seeks raise bond program ceiling to P30 billion

14th September 2020
Dr Matsheka

This week Minister of Finance & Economic Development, Dr Thapelo Matsheka approached parliament seeking lawmakers approval of Government’s intention to increase bond program ceiling from the current P15 Billion to P30 billion.

“I stand to request this honorable house to authorize increase in bond issuance program from the current P15 billion to P30 billion,” Dr Matsheka said. He explained that due to the halt in economic growth occasioned by COVID-19 pandemic government had to revisit options for funding the national budget, particularly for the second half of the National Development Plan (NDP) 11.

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Lucara sits clutching onto its gigantic stones with bear claws in a dark pit

14th September 2020
Lesedi La Rona

Botswana Stock Exchange (BSE) has this week revealed a gloomy picture of diamond mining newcomer, Lucara, with its stock devaluated and its entire business affected by the COVID-19 pandemic.

A BSE survey for a period between 1st January to 31st August 2020 — recording the second half of the year, the third quarter of the year and five months of coronavirus in Botswana — shows that the Domestic Company Index (DCI) depreciated by 5.9 percent.

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Botswana Diamonds issues 50 000 000 shares to raise capital

14th September 2020
Diamonds

Botswana Diamond PLC, a diamond exploration company trading on both London Stock Exchange Alternative Investment Market (AIM) and Botswana Stock Exchange (BSE) on Monday unlocked value from its shares to raise capital for its ongoing exploration works in Botswana and South Africa.

A statement from the company this week reveals that the placing was with existing and new investors to raise £300,000 via the issue of 50,000,000 new ordinary shares at a placing price of 0.6p per Placing Share.

Each Placing Share, according to Botswana Diamond Executives has one warrant attached with the right to subscribe for one new ordinary share at 0.6p per new ordinary share for a period of two years from, 7th September 2020, being the date of the Placing Warrants issue.

In a statement Chairman of Botswana Diamonds, John Teeling explained that the funds raised will be used to fund ongoing exploration activities during the current year in Botswana and South Africa, and to provide additional working capital for the Company.

The company is currently drilling kimberlite M8 on the Marsfontein licence in South Africa and has generated further kimberlite targets which will be drilled on the adjacent Thorny River concession.

In Botswana, the funds will be focused on commercializing the KX36 project following the recent acquisition of Sekaka Diamonds from Petra Diamonds. This will include finalizing a work programme to upgrade the grades and diamond value of the kimberlite pipe as well as investigating innovative mining options.

Drilling is planned for the adjacent Sunland Minerals property and following further assessment of the comprehensive Sekaka database more drilling targets are likely. “This is a very active and exciting time for Botswana Diamonds. We are drilling the very promising M8 kimberlite at Marsfontein and further drilling is likely on targets identified on the adjacent Thorny River ground,” he said.

The company Board Chair further noted, “We have a number of active projects. The recently acquired KX36 diamond resource in the Kalahari offers great potential. While awaiting final approvals from the Botswana authorities some of the funds raised will be used to detail the works we will do to refine grade, size distribution and value per carat.”

In addition BOD said the Placing Shares will rank pari passu with the Company’s existing ordinary shares. Application will be made for the Placing Shares to be admitted to trading on AIM and it is expected that such admission will become effective on or around 23 September 2020.

Last month Botswana Diamond announced that it has entered into agreement with global miner Petra Diamonds to acquire the latter’s exploration assets in Botswana. Key to these assets, housed under Sekaka Diamonds, 100 % subsidiary of Petra is the KX36 Diamond discovery, a high grade ore Kimberlite pipe located in the CKGR, considered Botswana’s next diamond glory after the magnificent Orapa and prolific Jwaneng Mines.

The acquisition entailed two adjacent Prospecting Licences and a diamond processing plant. Sekaka has been Petra’s exploration vehicle in Botswana for year and holds three Prospecting Licenses in the Central Kalahari Game Reserve (Kalahari) PL169/2019, PL058/2007 and PL224/2007, which includes the high grade KX36 kimberlite pipe.

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