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BSE innovates to get more liquidity

The Botswana Stock Exchange (BSE) is on a quest to grow. This growth will be evident in its market capitalization as well as the liquidity of shares listed on the bourse.

BSE deputy chief executive officer, Thapelo Tsheole, at a meeting of the Afena Capital Press Club last week, said that the top five listed companies on BSE, which represent 20 percent of the companies on the board, contribute 70 percent of total turnover of stocks, a situation that is not ideal.

“Ideally, liquidity should be broad based and should be across all the sectors,” said Tsheole.

Letshego, which has led the BSE for three years running, is in the company of Choppies, Sechaba, Sefalana, Botswana insurance Holdings Limited in the top five.

In total, P1,637 billion has been traded on the exchange, from beginning of the year up to July, with a daily turnover of P11,6 million, a big improvement from 2014 and 2013, with P8,8 million and P9,3 million, respectively, in daily trading.

“We are going to approach fund managers such to help us to attract foreign companies to list on the BSE,” said Tsheole. “Unlike the New York Stock Exchange, because of our structure, we have to go out and look for investors.”

The BSE, in relation to a mega stock exchange like the Johannesburg Stock Exchange, with a trillion US dollar market capitalization, is very small but has the potential to development the foreign investor appetite for the country, according to Tsheole. The BSE market cap as of 2012 stood at about US $ 4,587,518,585 as of 2012.

He said that Botswana’s lack of exchange controls was an advantage for investors who would want to move their profits out of the country and that advantage would be harnessed in attracting companies to lies on the BSE.

Botswana abolished all exchange controls in 1999, after having removed all controls on current account transactions, and controls on capital account further liberalised, in 1995.

Other countries like Zambia and Mauritius have followed suit while others like South Africa still have them in place, arguably to their own detriment, according to some observers.

With regards to privatization, Tsheole said that the privatization was still born, with the Policy having been introduced s far back as “We have never had as many calls and enquiries as when the BTC (Botswana Telecommunications Corporation) was supposed to list,” said Tsheole.  

He said that companies are reluctant to but the effect of them listing could only be exponential growth, citing Choppies Group and Sefalana, who are both growing phenomenally.

The BSE has started the process of introducing market makers, as a way to improve the liquidity of its securities. It will be only the second on the continent after Nigeria, to make this move.

Market making is described as the act of simultaneously submitting bid and offer prices into the Automated Trading System (ATS) with the intention of infusing liquidity in securities that are not frequently traded on the stock exchange.

Tsheole said the implementation of market making on the local exchange involves the appointment of institutions that would have applied to be registered as market makers, “to unlock liquidity, leading to better price discovery and an increase in the depth of the market.”

Market is also said to create ease entry and exit of investors, which will lead to, enhanced portfolio diversification, management and development of other securities.

Market makers are typically banks and brokerages, which stand by all hours of the trading day, with a firm, ask and bid price on a stock.

The BSE Transition Act and the Securities Act finally were promulgated in 2014, after being mooted more than ten years ago. The new laws await drafting of Regulations by the Ministry of Finance and Development, and will see the BSE being demutualised, becoming a company and ultimately also listing on its own stock exchange.

The BSE was established in 1989, when it was known as the Botswana Share Market (BSM). Then, there were only 5 (five) listed entities, with a single broking firm in the market which was also charged with facilitating trading on the exchange via matching orders. As the years passed, it was becoming clear that there is a need to separate the running of the exchange from the broking firm and this set in motion preparation for the establishment of an independent exchange. The authorities only established the Botswana stock exchange (BSE) as a separate legal entity in November 1995 following the passing of the BSE Act of 1994.

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Food prices continue to rise, but at a slower rate

28th November 2022

Prices for cereals or staple foods in Botswana and other Southern African countries continue to rise at a slower pace, following trends in the global markets, according to the latest November 2022 Food Price Monitoring and Analysis by Food Agricultural Organization (FAO) of the United Nations.

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Still doing business the old way?

18th November 2022

It’s time to get business done better with MTN Business Botswana’s ICT Solutions.

Running a digital businessMTN Business Solutions Botswana, popularly known as MTN Business is an Internet Service Provider. We are a subsidiary of MTN Group Limited, a multinational telecommunications Group headquartered in South Africa, which operates in 19 markets across Africa and the Middle East.

More and more, clients are looking for ways to keep their staff productive in a dynamically changing business environment. Whether your people are working from home, the office or abroad, there is a growing recognition that digitising your operations can offer unprecedented commercial value in flexibility, productivity and growth. This new, digital reality means that it is more important than ever to stay agile – if there is anything that can slow a business down, it is being burdened by othatld technology.

Having made substantial investments in fibre technology, high-speed terrestrial and undersea networks and new frequency spectrum across the markets wherein it operates, MTN is perfectly positioned to respond to this shift in the market.

A few years ago, MTN also made the decision to build an IP capable radio network for its mobile services, giving its core network the ability to seamlessly integrate with enterprise IP networks. The mobile towers deliver services to enterprise clients absolutely anywhere it has a network, shortening the last mile and removing complexity and cost.

Now there is increasing demand from clients to connect their remote sites in all areas, including rural and semi- rural. MTN has assisted clients with overcoming this connectivity hurdle, enabling their staff to get the job done wherever they are.
MTN’s evolution

For MTN, the focus has shifted from just being a core telecommunications services provider, towards also becoming a technology solutions provider. The service offering now also includes Unified Communications, Data Hosting and Cloud Solutions, Security-As-A-Service and Managed Network Services. The scope has changed to being client and industry specific, so the requirements and service portfolio vary from one client to the next. The expectation is that a company like MTN must respond to these challenges, helping clients to get business done better as they shift from old to new technologies.

As many businesses continue to grapple with a digitally dynamic world, they face new challenges that have to be solved. This environment will benefit those that are more digitally enabled and agile. It is a brave new world that will favour online over on-site, wireless over wired and fluid over formulaic. Businesses will seek out partners and suppliers that are every bit as flexible and forward-looking as they are.
Ultimately, clients need partners like MTN Business that will invest in infrastructure, deliver the services they require, have market credibility, are financially sound and have a long-term commitment to their market presence.

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BIE to vitalize the Dignity of Engineers

9th November 2022

Botswana Institution Of Engineers (BIE), has last week hosted a gala dinner in  which they appreciated engineers who worked tirelessly and with dedication for 10 years from 1983 to steer the BIE to its current status.

The event that was held at the Phakalane Golf Estate had brought together young, experienced and veteran engineers and was held under the theme “Vitalize the dignity and eminence of all professional engineers”.

Explaining the theme, the institution’s treasurer, Thanabalasingam Raveendran said that engineers were looked upon reverentially with respect as the educated but with time it seems to have deteriorated. He indicated that there is a need to change the narrative by all means.

“The BIE exists for the welfare and the betterment of us Botswana engineers, we need to recognize specialised units within our Institution. We Engineers strongly believe in Engineers make it happen” Raveendran said.

He indicated that under the theme they appeal to all engineers to energize, to attain quality of being worthy of honour and respect and to achieve recognized superiority amongst the Society.

Raveendran stated that engineers need to ensure their end product is of good quality satisfying the end users expectations and engineers must be honest in their work.

“Approximately 8000 engineers registered with Engineering Regulatory Board (ERB) are not members of the BIE, engineers need to make every effort to recruit them to BIE” he said.

He alluded that BIE being a society, it currently needs to upgrade itself at par with professional institutions elsewhere like the UK and USA.

He further stated that BIE has to have engineering units of specialised disciplines like Civil/Mechanical/electrical etc

“As President Masisi indicated in his inaugural speech, the young people, who make 60 percent of the population of this country, are the future leaders and therefore investing in them is building the bridge to the future” said Raveendran

Kandima indicated that BIE has a memorandum of Understanding with Engineers Registration Board (ERB), where BIE is a recognised provider of CPD training, mentorship programmes and more importantly IPD undertaking to upgrade the skills and know-how of our engineers.

“For us to achieve our mandate and make worthwhile changes to engineering in Botswana, we have to be totally focused and act with intent” said Kandima.

Furthermore, Stephen Williams, past president of the BIE from 1986-1988 told the engineers that  the BIE provides a fertile environment where they can meet, share ideas and grow professionally.

“The BIE is also a nesting place for graduate engineers to learn from their peers and seniors, it also cater for engineering technicians and technologists and so nobody in the technology field is left out” he said.

He further indicated that Botswana Government provides a conductive environment for growth of engineering professionals.

“It must be stated that the Botswana Government recognises the existence of BIE and it can further be stated that the government enables ERB to carry out its mandate as a regulator of engineering professionals” said Williams

He plead with engineering companies to recognize and support BIE as it is the only source of engineering personnel’s for various Industries .

Furthermore, when giving his farewell speech, Michael Pinard , a past president of the institution  said how they are viewed as engineers by the general public might be due to some lack of appreciation as to exactly what role they play in the development of the country.

“The BIE slogan is aptly coined-Engineers make it happen, in other words, what man dreams engineers create” Said Pinard.

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