The Botswana Gambling Authority (The Authority) has begun the process of selecting an operator for the Botswana National Lottery. The non-refundable one Million Pula applications are now open and the lucky applicant will use the same license for the period of ten years with annual licence fee of the same amount.
Gambling Authority Chief Executive Officer, Thulisizwe Johnson, announced at a media briefing earlier this week that each applicant will be charged the non- refundable fee. He further stated that even though an annual P1 Million licence fee will be charged for the next ten years, the regular tax will apply as well as the gambling levy. The Gambling Authority explained the National Lottery Request For Application (RFA) process, and further offered details on how the lottery can support economic diversification.
The Gambling Authority, a statutory body mandated with licensing and regulating the gambling industry in Botswana, recently started a search for the nation’s first Lottery operator. This comes three months after the Gambling Authority Board approved the issuing of licenses for Casinos, Lottery, Sports Betting and Bingo. The process towards selecting an operator for the Botswana National Lottery started earlier this month following the publication of a guiding document for the bidders.
The draft document has been made available up to mid-month to allow the public an opportunity to comment directly to the Gambling Authority before the final RFA is published. The RFA is the guide document which shall be used to provide information on the process and the information required from applicants to be assessed for the award to the successful operator.
The draft document sets out details of the National Lottery opportunity together with the process and requirements connected with submitting the application. The applicants will be required to provide a complete solution for the lottery, including: setting up and running the lottery; designing, building, financing and operating the requisite infrastructure and systems; designing, distributing and marketing lottery games and ensuring a smooth transition from award of licence to operations.
At the press briefing, Johnson, Gambling Authority’s CEO, said the search for the operator for the national lottery has begun and the licence will be for a period of ten years. He also said the main criteria to awarding the licence hinge on the investment required for operating the lottery and the knowledge and the systems. Mr. Johnson says the lottery will provide some form of entertainment for people while also adding to government revenues.
“Through the National Lottery Distribution Fund, money will be disbursed for good causes, mainly for sports, charities, the arts, and other good causes. Even winning the jackpot can change a person’s life although statistically it’s a rare occurrence,” the CEO said.
It was revealed that the assessment process for choosing the operator will involve due diligence, in-camera interviews, scheduled public hearings, site visits and presentations. The preferred operator will then be announced in September. The Authority says once the licence has been issued and the lottery is up and running, it is expected that it will result in increased revenues for the government and also support economic diversification. Furthermore, there is expectation of job creation and support for other businesses that will be outsourced.
Mr. Johnson emphasised that in preparation for Botswana’s first national lottery, they intend to make the process as transparent as possible, citing the anti-corruption policy and whistle blowing as some measures put in place to mitigate against corrupt practices. Moreover, auditors will be appointed to oversee the process and provide assurance of the process. The Gambling Authority CEO said that they are looking for experienced lottery operators with prior experience in penetrating and managing a new market. This move is done to ensure responsible gambling at all time, which includes crackdown on illegal gambling and protection of the weak and vulnerable that might fall prey to gambling addiction.
The chosen lottery operator is expected to impart skills to citizens through training and development, setting the stage for possible succession by a local operator in later years. Apart from acquiring new industry skills, newly started businesses owned by young people will be given priority during local procurement tenders. The Authority says a well run lottery system can help the country reduce its dependence on diamonds revenue and charter a new path to economic diversification.
While it will be Botswana’s first national lottery, the practice has been growing with popularity in Africa. According to World Game, a site that provides lottery fans with a global overview of how that game has taken root worldwide, Lottery games aren’t quite as numerous in Africa as they are elsewhere, but there are certainly enough of them to give players the chance to win huge sums of money for the cost of a single ticket. Part of the reason why the number of games is lower in Africa than it is in Europe or Asia relates to geography and population. Simply put, there are vast regions in Africa that are populated by a relatively small number of people, and it is therefore not as necessary for every region to have its own range of lottery games.
In Africa there are several countries with a national lottery; Algeria, Ghana, Kenya, Mauritius, Morocco, South Africa and South Sudan. South Africa has two of the most popular – the Lotto and the Powerball. Lotteries in Africa are most often viewed as games that are to be played primarily for entertainment purposes, with the excitement of having a chance of winning a jackpot being its own reward.
This seems to be the predominant view to lottery games the world over, although of course some players take their participation much more seriously than others. It is widely predicted that lottery games in Africa will continue to grow in popularity, not only among African players themselves but also with lottery players around the world now that it is possible for them to buy African lottery tickets online.
Despite its growing popularity, there is little consensus amongst experts on the true economic benefits of the game on a large scale. Many experts, particularly economists, argue that the economy would get more boost if consumers bought goods and services instead of lottery tickets. They further argue that spending money on businesses helps spur much more economic activity than gambling on the lottery.
Lotteries run for or by governments are used to support public programs such as infrastructure development, public safety, public health and education. The principal argument used to support lotteries has focused on their value as a source of "painless" revenue, contributed by players voluntarily spending their money.
Lottery tickets have become a significant source of funds for governments, and the winners obviously benefit greatly. But lotteries for the most part have a regressive impact. Studies have found that the burden falls disproportionately on people with lower incomes, who typically spend a greater portion of their income on lotteries than those with higher incomes. It is a burden because the odds are worse than other forms of gambling.
The usual presumption is that people know what’s good for them, and that they’re better off if you allow them to spend their money on whatever they personally value the most. For many people, gambling may be just another form of entertainment. But for others it is a very destructive compulsion.
THE RFA EXPLAINED
The draft RFA has already been published in the Authority’s website for public comments. The RFA is the guide document which shall be used to provide information on the process and the information required from applicants to be assessed for the award. The purpose of the publication is to give the public an opportunity to comment directly to the Authority before the final RFA is published. In that regard, the Authority has invited the public to provide comments on the DRAFT National Lottery RFA document which has been made available for download on their website. March 28, 2017, will mark the opening period for enquiries.
Once the one million pula application fee has been paid, the applicant will receive a detailed RFA. Bidders will be invited for a conference to take place on the 18th April and the final date for receiving applications is June 30th 2017. Completion of proposal evaluation, site visits and presentations to the Authority will be on 25th August and announcement of the award is scheduled to take place on November 17th, 2017. Johnson said there will be an open tender for a credible and reputable auditor who shall be the overseer of the project. As many people view this as an exclusive opportunity for the rich, the Authority CEO; Johnson sees it differently, “Contrary to popular belief, it is very cheap!”
According to Johnson, the investment required for operating the lottery and the knowledge and system are important criteria for award. He advised interested parties to form business consortiums and or seek technical partners or look for experienced operators to bid with. “We want the lottery to be run by Batswana and we will train them,” said Johnson.
He added that lotteries are done for good causes because they provide government with tax revenue and energies people as they seek to guess the numbers that will come out of the draw. Through the national lottery distribution fund, money for good causes, mainly sports, charities and the arts are disbursed. “Lotteries can change one’s life. Winning the jackpot can change one’s life even though statistically this is a rare occasion,” Johnson pointed out.
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.
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.
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.