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South Africa vs Botswana: which country is the best safari destination?

Elephants

Both countries offer an exceptional safari experience with best-in-the-world lodges in pristine bushveld settings, outstanding natural beauty and rich fauna and flora. And they both boast an extraordinary region that’s a UNESCO World Heritage Site, namely Okavango Delta in Botswana and Kruger National Park in South Africa.

South Africa and Botswana are neighbours and compete as the premier safari destinations in southern Africa. It’s impossible to choose one over the other because both countries have so much to offer but we can tell you what you’ll trade-off when weighing South Africa up against Botswana for the safari tour of your dreams.

South Africa

South Africa offers you the iconic Kruger National Park and its exclusive neighbour, Greater Kruger. Located in the far north-eastern corner of South Africa and sharing an unfenced boundary, the two Big 5 safari regions represent the finest and most diverse biospheres in Africa.

Kruger Park is the oldest and largest national park in South Africa while Greater Kruger is an amalgamation of 18 unfenced game reserves that are privately-owned and exclusive. Familiar names include Sabi Sands, MalaMala, Londolozi, Lions Sands and Singita.

The fence between Greater Kruger and Kruger Park has been removed and the animals roam freely over an area that spans some 22 000 square kilometres. Combined, Kruger Park and Greater Kruger are core to the Kruger2Canyons (K2C) and Vhembe UNESCO Man and Biospheres and fall within the Great Limpopo Transfrontier Park.

However, you’re not limited to visiting Kruger Park or Greater Kruger in the far north corner of the country. South Africa has 21 national parks and a wide choice of topnotch private game reserves. Familiar names include Pilanesberg, Madikwe, Addo Elephant, Phinda and Hluhluwe Imfolozi. The beauty of these safari destinations is they’re located in malaria-free areas in South Africa.

Botswana

Okavango Delta needs no introduction. The magical wetland region is Botswana’s flagship safari destination and possibly the most magnificent place to visit in Africa. It’s one of the world’s largest inland deltas, a UNESCO World Heritage Site and one of the 7 Natural Wonders of the World.

The vast wetland lies on a tectonic trough in the parched Kalahari Basin where the Okavango River empties onto the vast savanna plains. Annual flooding increases the size of the inland delta to three times its size and transforms the region into a lush tropical haven, attracting an abundance of animals and migrant birds which are best viewed from a river canoe silently paddling down the narrow channels.

Botswana has a lot more to offer than Okavango Delta. It has some of the finest protected ecosystems in southern Africa; each an oasis so diverse that travellers return year after year for new experiences in the wild and untamed corners of the country. Familiar names include Chobe, Moremi, Savuti, Linyanti, Kgalagadi and Makgadikgadi Pans.

South Africa versus Botswana: which offers the best safari experience

South Africa offers a more commercial, tourist-friendly safari experience with a wider choice of accommodation for all safari budgets. Greater Kruger and the private concessions in Kruger Park unashameably target the top-end safari market but there’s more than enough to choose from for comfortable accommodation that doesn’t deplete your credit card.

Safari destinations in South Africa are all within easy commuting distance from the big cities. You have the option of self-drive safari tours which are family-friendly and help to keep costs down; otherwise choose a reputable tour operator who offers first-rate safari tours at a price that’s affordable on the current exchange rate.

A safari tour to South Africa can be combined with a tour of Cape Town and the glorious Garden Route where breathtaking scenery, rich cultural heritage and excellent wine and gourmet meals beckon. Or head east to KwaZulu Natal for beautiful beaches, splendid mountains and outdoor living at its best.

Botswana attracts a more adventurous traveller with a bigger budget. You’ll find a selection of bush camps and campsites suitable for the cost-conscious traveller but on the whole, Botswana is a more expensive choice. The trade-off is an incomparable safari experience that’s worth every cent.

Botswana’s sought-after safari destinations are located in remote areas that are wild and untamed, and harder to get to than those in South Africa. Getting to your safari lodge in Botswana typically involves an international flight to Johannesburg and another to Maun and then a fly-in/fly-out charter flight. The benefit is lower tourist numbers and thus, less habituated wildlife.

Unlike South Africa, the safari regions in Botswana are unfenced and game migrates freely across the vast savanna plains. The remote, rugged areas coupled with low tourist numbers offers travellers a more authentic safari experience that’s hard to beat anywhere else in southern Africa.

So, to answer the question; which country offers the best safari experience? South Africa and Botswana come tie because they both boast the finest wilderness regions, incredible wildlife and birding as well as outstanding safari facilities. You’ll have to try both and decide for yourself.

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Business

A Culture of compliance and financial reporting best practice

27th July 2020

As the complexity and volatility of the business environment has increased, the demand for improvements in the quality of financial information from investors and other decision makers has risen in tandem. Unsurprisingly therefore, the topic of changes to International Financial Reporting Standards (IFRS) has become increasingly prevalent.

However, before delving into what these changes mean for an organization, it is perhaps useful to first provide an overview of the nature and purpose of IFRS. For anyone in the accounting or finance fields, this acronym has become a common phrase critical to any financial reporting undertaken by an organization.

International Financial Reporting Standards are developed and issued by the International Accounting Standards Board (IASB) and provide guidance on how financial statements should be prepared and disclosed. They provide a framework for consistent and comparable information which ultimately helps investors, regulators and other interested parties, make decisions.

In other words, as a global standard, they provide a level playing field amongst companies for reporting financial performance. This is a matter not only of compliance, but also of corporate governance, and thus an integral part of how any financial services sector business ought to be doing business.

As an indication of the pace of change, in the last three years, over twenty new or amended accounting standards have come into effect. The insurance industry is currently in the process of implementing IFRS 17, which speaks specifically to insurance contracts, replacing its predecessor, IFRS 4. The standard will come into effect from 2023 and will significantly change the accounting process for insurance contracts and investments contracts with discretionary participation features.

This new standard has been described as the single largest change in insurance accounting for almost a generation. The standard is intended to provide a more detailed and rigorous framework for the measurement and recognition of key insurance related values and will significantly change the way in which insurer’s measure and recognize insurance liabilities, revenue and profit.

It will also change the presentation of the income statement and statement of accounting position and will require a significant number of new disclosures in the financial statements. The standard requires more detailed measurement of insurance related cash flows, introduces new methodologies for measuring and recognizing insurance contact liabilities and introduces a number of new concepts such as insurance contract margin and risk margin.

All of these changes are meant to create greater visibility of the relationship between the provisions of insurance services and the recognition of revenues and expenses relating to the provision of these services and to align the recognition of revenue and profit with non-insurance businesses.

The overarching intent of the standard is to reduce the variability of results due to differencing accounting treatments employed by various insurance entities and to improve the comparability of financial results between insurance businesses as well as between insurance and non-insurance businesses.

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Business

“We need to shape businesses for a future after COVID-19” – Stanbic Bank Botswana

27th July 2020
Sheperd Aisam

Stanbic Bank Botswana has hosted key clients of the Bank’s Corporate & Investment Banking (CIB) arm for a series of sector-focused webinars, themed “Economic Updates.” The purpose of the series is to provide timely insights for executives within the Bank on the COVID-19 pandemic and its impact on the economy and business operations, with Stanbic Bank committed to supporting clients through this time to enable them to shape their business post COVID-19, across sectors.

There are critical sectors that have been impacted more severely than others like the Tourism & Hospitality sector, Real Estate sector, Mining and the Luxury or non-essential component of consumers, for example Diamonds.  In the same vein, there are sectors that are well positioned for growth for example Healthcare, Innovation & technology, Agri-processing and Infrastructure sectors.

Said Sheperd Aisam, Head of Corporate & Investment Banking (CIB) at Stanbic Bank Botswana, “Focusing on attracting capital to the rapid development of AfCFTA goals in Botswana and onto the continent will create a more resilient marketplace in Africa and make us able to better withstand future pandemics.”

According to the most recent information of an expected 8.5% GDP decline in Botswana where most sectors will be affected and as a consequence jobs may also be at risk. There is no better time for us to focus on the silver linings and come together to address these challenges in a unified way.

This year the government has many positive initiatives in various sectors set up to stimulate the economy and to give us much needed hope such as the BECI initiative; the recently launched CEDA initiative; the incremental component of local currency bond and T-Bills to fund the budget deficits of which we are excited about.

As a Bank we have initiatives for alignment with strategic country goals and supporting our personal, Commercial and Corporate Banking clients which are available to our client base.   Amongst the key aspects businesses need to ensure for continued survival are a focus on strengthening our supply chains, leading on digital client interactions and regional collaboration particularly on manufacturing, it was shared.

This is very much in line with the notion of ‘survival of the quickest” and will no doubt be about how quickly businesses can adopt and adapt to the times so that they can take benefit of some of the new opportunities now out there.

According to Mulalo Madula, an Economist for Africa Region Fixed Income and Currency Research at Standard Bank Group, the IMF projects the global economy to shrink by 3% and G10 strategists see it shrinking by 2%, with China growing by 6%. Developing economies are likely to contract by roughly between 2% and 4%, she notes.

“We expect that many countries in Europe will struggle with huge debt post COVID-19. We tend to think Botswana is in a better situation as we do not look externally for financial relief. In Botswana or Africa as a whole, because we do not exist in a vacuum, we would have been affected even if we had zero infected cases as we are all connected
economically.”

Concluded Aisam, “For Botswana businesses we are here to support you, we have access to 20 direct African markets through our on the ground presence in these jurisdictions. We have learnt and are still learning and happy to share with you our deepest of insights. There is an African story of growth that beckons us and our time is now.”

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Business

Food movers bullish in markets amid lockdown high eating costs

27th July 2020

A lot of economic dynamics explain that Botswana households during lockdown had less choices and options and found comfort in food despite its costs going up. The cost of food in Botswana increased by 3.60 percent in June of 2020 over the same month in the previous year, mirroring high prices from food import production.

Research shows that Botswana’s economy would bear the cost of being reliant on food imports when demand calls supply out. With the increase of food consumer price index when lockdown started in April to June (1.3) and Food & Non-Alcoholic Beverages group being dominant in contributions of groups to annual inflation rate during the time of stay at homes, investment shifted on consumables goods or foodstuffs.

Investment or risk appetite of owners of food suppliers and retailers remain resilient and confident in the financial markets. This could be because consumers’ sentiment on food prices cannot change the appetite for food amidst the chaotic economic environment of Covid-19.

A higher consumer price index may affect food importing countries like Botswana whose households tend to spend a larger percentage of income on foodstuff. According to Statistics Botswana, food comes third after transport and housing in this country when it comes to weighing inside the Consumer Price Index basket.

Back to investment in consumables or products that are highly in-demand, sold quickly and affordable, the financial markets are currently responding despite the higher cost of food and its marginal increase in inflation rate.

According to a recent market analysis from a fresh stockbroker research activity spanned across a number of sectors in the market and the Fast-Moving Consumer Goods (FMCG) is leading the pack; “Sefalana and CA Sales, stocks claimed over half of the volumes traded and turnovers even higher.”

According to Motswedi Securities, for the week ending 17 July there was, “a welcome improvement from the 1.58mn shares that traded worth P3.83mn in the prior week.”
According to Stockbrokers Botswana, putting the same period and the two FMCG stocks into context, there was a turnover amounting to P27, 4 million as 6, 3 million shares exchanged hands; Sefalana (42 percent) and CA Sales (27 percent) were the biggest contributors to turnover.

Sefalana and CA Sales invest on FMCGs or products that are highly in-demand, sold quickly, and affordable. Value chain for fast-moving consumer goods in Botswana research shows Sefalana takes a bulk of its supplies by trucks or ships as “large supplies from foreign supplies” or imports.

The supplies will then reach a wholesaler and Sefalana acts as a transporter of goods and wholesaler. Before the goods can reach consumers, Sefalana will sell it as a retailer too. CA Sales is a giant independent distribution agent and supplies most grocery chains around the country.

A curious investment appetite movement for a sector whose value chain was almost affected by country to country Covid-19 measures. Truck drivers coming from other countries to Botswana waited at the border for days before they could be tested. If they tested positive for the pandemic, they would be returned home if they are foreigners or quarantined if they are locals. This publication saw trucks which were supposed to deliver FMCGs to the country stuck at boarder gates.

But investors are still in the gamble for the stocks of FMCGs. Some simplistic observation from trade experts is that Botswana is a consumer population and despite the pull of demand to supply being skewed, people will still buy food than any other commodity.

According to the June inflation statistics, food prices went up but there was less action in inflationary consequences in other commodities. Notably, communication recorded low inflation rate, recreation and culture was at a low as well, this was because people stayed at home while transport hit the negatives as cars were packed save for few ones driven for essential services.

When making their investment past decisions, FMCGs investors could be reading the forecast notebook recorded by researchers last year of a strong consumer demand supported by positive economic growth and low inflation which will protect consumer purchasing power over the coming quarters.

That time there was “a recent increase in wages for public servants as well as increases in the minimum wage bodes well for consumer-facing companies.” But that was before Covid-19 when government was forced to withheld public servants salaries and the fiscal and IMF lowered their economic projections.

According to renowned think tank Fitch Solutions, consumer spending growth in Botswana is projected to be weaker in 2020 due to the negative impact of the Covid-19 pandemic. “We have revised our forecast for real household spending growth down to 0.7% y-o-y in 2020 from a pre-Covid-19 forecast growth rate of 4.9% y-o-y,” said the think-tank recently.

Thou shall live by bread and cereal alone

Bread and cereal is the stable food in Botswana and it is shown by Botswana’s continued demand for it at higher volumes and takes the largest weight in the food consumer price index. According to Food and Agriculture Organization (FAO), Botswana is a net importer of cereals, with more than 90 percent of the domestic requirements normally satisfied by imports.

According to the latest Consumer Price Index report from Statistics Botswana, the Food & Non-Alcoholic Beverages group index rose by 0.5 percent, from 105.2 to 105.7 over May and June. According to Statistics Botswana, prices of bread and cereals, which have the largest weight in the food price index, increased steadily throughout 2019 and early 2020, and were estimated to be 4 percent higher year on year in June 2020.

FAO said of March 2020, prices of bread and cereals were slightly higher compared to year‑earlier levels. This increase mainly reflects the high prices of maize in South Africa, the country’s main supplier of grains. A disturbance of bread and cereal import value chains is expected to be worse for June/July statistics given the lockdown border disruptions.

Cereal imports in the 2019/20 marketing year (April/March) increased to an estimated 440 000 tonnes, over 20 percent above the previous five‑year average partly reflecting the low domestic cereal harvest in 2019, according to FAO. Maize which accounts for the largest share of cereal imports, is estimated at 265 000 tonnes.

Without imports Botswana is expected to wait for the harvest which is expected to have concluded in June according to FAO. Harvested cereals are mostly sorghum and maize.
About 38 000 people were estimated to be in need of food assistance in the April 2019‑March 2020 period, compared to an estimated 35 000 people in the previous year, according to the Botswana Vulnerability Assessment Committee (BVAC).

In its Global Information and Early Warning System, FAO said the moderate increase is mainly due to the reduced 2019 cereal harvest and the deterioration of livestock body conditions, which particularly affected the livelihoods of subsistence farmers.

FAO in its Global Information and Early Warning System recently also posted that: “Looking further ahead, although an increase in cereal and livestock production in 2020 would improve food availability and ease access constraints to food for subsistence farmers, the risks posed by the COVID‑19 pandemic could cause an increase in the prevalence of malnutrition at the national level.

The effects of the pandemic are expected to be primarily channelled through a reduction in economic activities and associated income losses. A breakdown in supply chains, particularly in relation to trade disruptions with South Africa, which is the primary source of staple foods, would have sizeable impacts on the availability of food supplies in local markets.”

The cost of a healthy diet amid ‘The Great Pandemic’

Cereal and bread are not considered to be healthy food in terms of their nutritional value, as they contain a lot of carbohydrates which are said to be fuelling obesity and its health repercussions in any economy. Fruits and vegetables which are commonly recommended as a panacea to many diseases like immunisations against Covid-19 and makes healthy meals, are trailing the food consumer price index weights at number 6 and 7 respectively.

This paints a picture that Batswana’s diet is predominantly carbohydrates or cereal and bread as opposed to the healthy fruits and vegetables. According to FAO, Assistant Director-General and Regional Representative for Africa, Abebe Haile-Gabriel in a piece sent to BusinessPost, hunger is on the rise in Sub-Saharan Africa, and a healthy diet has become an out-of-reach luxury item for many Africans.

According to Haile-Gabriel, there is a recently launched ‘The State of Food Security and Nutrition in the World (SOFI)’ report which found that Africa has the highest prevalence of undernourishment – more than twice the global average – and the fastest growth in the number of hungry people compared to other regions.

“COVID-19 is compounding the problem. Disruptions to food supply and livelihoods mean that many households are facing increased difficulties in accessing nutritious foods, particularly for the poorest and most vulnerable. Preliminary projections outlined in the report suggest that COVID-19 could add an additional 83 to 132 million people globally to the ranks of the undernourished,” said Haile-Gabriel.

Haile-Gabriel also added that the cost of a healthy diet is above the international poverty line, meaning that people earning less than US$1.90 per day cannot afford to eat adequate calories and nutrients from diverse food groups. The UN representative also said, compared to other regions, this affordability poses the greatest challenge in Africa, where a healthy diet is beyond the means of nearly a billion people.

“In sub-Saharan Africa, a healthy diet costs 3.2 times more than the poverty line, and the situation is even worse in countries with a protracted crisis such as conflict. The poverty line itself needs to be reviewed to include the cost of nutritious food as a basic cost of living,” the FAO chief said.

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