SPEDU splashes P200 million for Platjan Bridge
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The Selibe Phikwe Economic Diversification Unit (SPEDU) is injecting some pace into its implementation strategy and seeks to develop a bridge in the estimation of close to P200 million in the Bobirwa area. The project is envisaged to excite the tourism sector in the area with over a billion Pula generation annually when fully operational.
The Platjan Bridge construction is likely to attract interests from a lot of companies and SPEDU is said to be guarded on the modus operandi. Recently they advertised for a company that could help them set up ITTs for the tender for construction as well as the recruitment of a resident engineer to oversee the project. RSS Engineering Pty Ltd was given the job and has now advertised to invite companies for the construction of the Platjan Bridge.
Puna Molebatsi, the Communications manager at SPEDU confirmed the developments and stated that they have engaged RSS as consultants who will help with the drafting of ITTs and tender evaluations. She said all the companies that have been engaged so far a 100 percent citizen owned. “By recruiting a resident engineer we intend to tackle the problem of capacity at SPEDU, but still that person will work with a well-resourced and experienced consulting company,” she said.
SPEDU is carrying out major projects like Motloutse farm electrification, horticultural processing plant, Platjan Bridge construction, mine museum, among other projects.
SPEDU was funded by the European Union’s Re-Employment Account that is administered by the Ministry of Finance and Development Planning. SPEDU has about P600 million in the account and one point the funds were a hot potato as some within the structures of SPEDU were adamant that the organisation was failing to add value to the money. But with a steady action plan towards implementing some of the projects, the argument of lost value could fade off.
The Platjan Bridge in Bobirwa is strategic for tourists to access the region and they are still profiling the tourist attractions in the area. The project is a priority area and P200 million has been reserved for its implementation. The hope is that more jobs will be created as the bridge is expected to unlock several opportunities in the area. Business people and farmers in the area have started striking partnerships with South African based investors and it is expected that the Platjan Bridge will ease movement between the two countries in the Bobirwa region.
FALTERING STEEL PROJECT
The faltering steel project saw about P89 million injected into the project and a manufacturing plan was officially opened in October last year and SPEDU was planning to let small businesses in its land banks to tap into the new steel business – but this remains a dream as the projects are struggling to take off.
Pula Steel was to become the country's first steel processing plant, but faces an uncertain future, barely twelve months after it was opened. The project, promoted by government as one of the key diversification drivers, as well as part of the BCL's diversification blueprint dubbed Polaris II, has been experiencing problems since inception.
Reports suggest that the plant was last week closed down by health inspectors, after it failed to meet safety standards. Striking expatriate workers at Pula Steel this week called for the dismissal of the steel processing plant's CEO, Ranvir Vermy.
The workers, who were brought from India to set up and commission the plant, have accused the CEO of failing to train the local workforce, using insulting language against both local and expatriate workers, as well as nepotism.
They accuse him of lack of knowledge or experience in steel processing, but always interferes in technical matters. The workers went on strike last week, complaining about going for months without getting their salaries, which are paid to their Indian accounts, while they are only given a living allowance of 500 Pula. BCL is the majority shareholder at Pula Steel.
OTHER SPEDU PROJECTS
The SPEDU region has a number of dams and the SPEDU management and Board have agreed that it is necessary to tap into the aqua tourism and create water resorts.
The Motloutse farm electrification project that entails supplying power to 44 farms along Motloutse River, they intend to improve the output of the horticultural farms along the river. SPEDU had injected P9 million has been injected into Botswana Power Corporation (BPC) to connect a 42 kilometre powerline and the corporation is yet to conduct the environmental impact assessment study and they had hoped the project will be completed by the first quarter of this year.
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Batswana owe banks P79 billion
The Minister of Finance, Peggy Serame, has disclosed that the total bank credit extended by commercial banks amounted to P79 billion, out of which P53.4 billion was retail loans and advances to households.
Parliament was informed this week in response to a question by the Member of Parliament for Selibe-Phikwe West and Leader of Opposition (LOO), Dithapelo Keorapetse.
“As at 31st December 2022, loans and other advances extended to households by banks constituted the largest share of bank-lending at 67.6 percent, the majority of which was unsecured personal loans at P36.2 billion (67.8%),” said Serame.
She added that the total household Debt to GDP ratio was 21.9%, while the total private business credit to Gross Domestic Product (GDP) ratio was 10.8%.
On the other hand, it was noted that outstanding mortgage loans extended to households were P14.2 billion (26.6% of household debt) or 5.9% of GDP. Overall, total bank credit as a ratio of GDP stood at 32.7 percent.
It was acknowledged that there are 10 deposit-taking banks in the country, that is, nine commercial banks and one statutory bank (Botswana Savings Bank). This statistics excludes the National Development Bank (NDB), which is a development finance institution. The nine commercial banks include an indigenous bank, Botswana Building Society Bank Limited (BBSBL), which was issued with a commercial banking license by the Bank of Botswana in October 2022.
Still in December 2022, it was recorded that there were 376 non-bank lenders in Botswana consisting of 246 micro lenders, 66 finance companies, three leasing companies and 61 registered pawnshops.
According to Minister Serame, the loan book value representing the principal amount lent by these entities to individuals and to small, medium and micro Enterprises (SMMEs) is collated by the Non-Bank Financial Institutions Regulatory Authority (NBFIRA), which at 31st of December 2021, the loan book values were P5.6 billion for micro lenders, P1.6 billion for finance companies, P225 million for leasing companies and P14 million for pawnshops.
Government policy is that price control is not effective or desirable, and, as such, interest rates are not regulated. Non-regulation may, among other things, result in an increase in non-interest rate fees and commissions, reduced price transparency, lower credit supply and loan approval rates.
“It is important to note that, from a macroeconomic perspective, household debt in Botswana is neither a pandemic nor considered to be excessive. Indeed, the Bank of Botswana’s periodic and continuous assessments of household debt, including through the annual Household Indebtedness Surveys, suggest moderate household indebtedness and therefore, is of no apparent risk to the safety and soundness of the domestic financial system,” said Serame.
She also alluded this assessment is validated by the recently concluded Financial Sector Assessment Programme (FSAP) on Botswana undertaken by the International Monetary Fund and the World Bank Group.
Keorapetse however rebuked the issue of debt not being excessive and noted the Minister thinks it’s fine for Batswana to be debt burdened in a way that their debts diminishes their quality of life.
“A significant portion of Batswana’s salaries go to servicing debts and because she doesn’t see this as a challenge, there can never be any intervention from her side. There is no price regulation on interest, which can go up to 30%+ a month. Since President Masisi ascended to the high office in 2018, 2 384 Batswana were put in prison for failure to pay debts, that is 467 Batswana every year. So, for us, debt problems are big and concerning,” said Keorapetse.
He said they are worried because Batswana are drowning in debts because of relative poverty, slave wages and unemployment/underemployment, they buy basic needs and services with borrowed money and noted predatory and unethical lending has become a major problem in Botswana’s financial sector.
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How to fleece P14 million from Chinese investor
The modus operandi of how five men allegedly swindled a Chinese national P14 million last week continue to unravel. Highly placed sources from the intelligence, the Directorate on Corruption and Economic Crime (DCEC) and Botswana Unified Revenue Services (BURS) revealed to this publication how the whole scam was concocted.
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ENVIRONMENT ISSUES: Masisi asks Virginia for help
President Mokgweetsi Masisi says the issue of sustainable natural resources management has always been an important part of Botswana’s national development agenda.
Masisi was speaking this week on the occasion of a public lecture at Virginia Polytechnic, under theme, “Merging Conservation, Democracy and Sustainable Development in Botswana.”
Botswana, according to Masisi, holds the view that the environment is fragile and as such, must be managed and given the utmost protection to enable the achievement of Sustainable Development Goals (SDGs).
“It is necessary that we engage one another in the interchange of ideas, perspectives, visualizations of social futures, and considerations of possible strategies and courses of action for sustainable development,” said Masisi.
On the other hand, dialogue, in the form of rigorous democratic discourse among stakeholders presents another basis for reconfiguring how people act on their environments, with a view to conserving its resources that “we require to meet our socio-economic development needs on a sustainable basis,” Masisi told attendees at the public lecture.
He said government has a keen interest in understanding the epidemiology and ecology of diseases of both domestic and wild animals. “It is our national interest to forestall the dire consequences of animal diseases on our communities livelihoods.”
President Masisi hoped that both Botswana and Virginia could help each other in curbing contagious diseases of wildlife.
“We believe that Virginia Tech can reasonably share their experiences, research insights and advances in veterinary sciences and medicines, to help us build capacity for knowledge creation and improve efforts of managing and containing contagious diseases of wildlife. The ground is fertile for entering into such a mutually beneficial partnership.”
When explaining environmental issues further, Masisi said efforts of conservation and sustainable development might at times be hampered by the emergence and recurrence of diseases when pathogens mutate and take host of more than one species.
“Water pollution also kills aquatic life, such as fish, which is one of humanity’s much deserved sources of food. In this regard, One Health Approach imposes ecological responsibility upon all of us to care for the environment and the bio-diversity therein.”
He said the production and use of animal vaccines is an important space and tool for conservation, particularly to deal with trans-border animal diseases.
“In Botswana, our 43-year-old national premier pharmaceutical institution called Botswana Vaccine Institute has played its role well. Through its successful production of highly efficacious Foot and Mouth vaccines, the country is able to contain this disease as well as supply vaccines to other countries in the sub-region.:
He has however declared that there is need for more help, saying “We need more capacitation to deal with and contain other types of microbial that affect both animals and human health.”