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Creating Botswana’s Next Value Frontiers

Tuelo Botlhole

Many economists have published detailed models about how steep a curve the movement from middle income status to high status is.

The middle-income trap has left many cabinets and high-powered delegations of experts drawing economic formulas that have left nothing beyond growing bodies of theory and a few actions that have delivered the much sought-after value. Emerging markets still remain emerging markets – a status quo long predicted to remain as such for many lifetimes.  A few countries have broken away from the middle-income barriers since the establishment of the World Trade Organisation (WTO). Our republic has been having the same debate for more than a generation whilst our economic diversification debate is still on full steam.

As we confront a changing world and new realities we have to answer difficult questions about where we are and where we are going. As a predominantly import economy, how much value do we derive from this economic model versus in-country capacity building in manufacturing? How is the balance of trade between our exports and our imports?  Which value frontiers remain untapped? What can give a genuine jump into a high-income economy? How do we get over the – ‘we are better than most adage and complacency?’  How can our natural endowments be the spring board of international competitiveness? What happens when basic goods run dry because exporters cannot even meet their own home demand?

As a construction industry player, I dream of a belt of vast factories – strong primary industries that mushroom from our cities and towns from Ramokgwebana to Charles Hill and beyond – giving beam and life to our people. Skills are harnessed, transferred and shared with our people as we forge a winning coalition of elevating our country beyond what we are and where we are now.  I remember the pride of our fathers when they came back from mines back in the yester years, the mere pride of using their own hands and skills in productivity.  They understood their contribution in the value chain. In Selibe Phikwe the ‘unending smoke’ from the BCL Mine represented life for the town and its people. A strong sense of nostalgia and a blend of emotions drew tears for many when for the first time in two generations the smoke failed to rise to the skies. The clear skies were symbolic of the new era a new time and a new reality – all minerals are finite. They are abundant today and they are depleted tomorrow.

Nkosi Mwaba, the former Botswana Export and Manufacturers Association Chairman (BEMA) and the current Chairman of Association Entrepreneurs Botswana (AEB) in a recent documentary commented on the pride of strong, local, vibrant manufacturing sector within our shores. “The global value chain can still be fully optimised for a strong manufacturing backbone in our country. We can support existing local manufactures to compete, increase their quality models and have sufficient capacity to cater for our economy and export. I worked for Bolux, they mastered their raw materials, where they source them at competitive rates, created a strong human capital base and today they do not only supply Botswana they supply the region,” says Mwaba.

Many global case studies support this. Germany was resilient in the 2008 global recession because of small enterprises that are a major contributor to the economy. The recession which changed the economic perking order in Europe acknowledged Germany is a supreme economy which was almost insulated when the global economy weaned in horror.

The rise of nationalism is a wave that is sweeping across different nation-states globally.  Exacerbated by the new reality of Covid-19 our regional trade is slowly creating a ‘one man for himself’ atmosphere. One of the senior Executive Managers Teedzani Majaula at Botswana National Productivity Centre (BNPC) asked a question. “What happens when South Africa closes its borders to us? What happen when they switch off their power, fuel and food produce? We have to reach a burning platform which will drive and trigger action,”

His assertions go beyond the normal free market economics argued by the ‘old school’ of markets and economics. The argument of raw materials, cost of production and natural endowments may be a to an extent hindrance towards stabilising critical tenets of our economy and day to day livelihoods for the long term. Israel is one of the largest exporters of produce with a climate similar to ours because of the huge numbers of scientists per capital in the country. What may have been dismissed as bear lands and desert terrains is at the centre of harvesting and exporting thousands of tonnes of produce per year.

The new economic model should look into how much of the import bill should be diverted towards the growth of local manufacturers across different industries. Where there is capacity there is no need for imports where there is a shortage there can be a balanced trade-off which includes imports to mitigate shortages. Moatlholdi Sebabole argues that there has to be a balance between increasing local capacity and disturbing FDIs for the broader health of our GDP. “Any form of protectionism may trigger unwanted circumstances in attracting FDIs. There has to be a well-managed narrative in terms of how this is structured,” he argues.

“Establishment of industries is built on assumptions, the access to raw materials at reasonable costs, labour markets that can deliver value, creation the entire value chain considers the profitability and the profitability growth. Going against this grain in hope of support may trigger unwanted circumstances. However, when the quality of products is good the Government can protect those good,” notes Majaule.

For PPC Botswana, the burning platform has always been how the local manufacturer which used local fly ash from Morupule B for years before the arrangement changed can continue employing Batswana.

The quarries in Kgale, Francistown and Mokolodi are part of a value chain which has strong downstream industry beneficiation. The plant at Gaborone West Industrial are a chemical process of cement production which has emboldened and empowered local applied chemistry experts, chemical engineering gurus amongst others. That entire value is lost when the emphasis is on imports at the expense of establishing a full operation. Materials used in blasting rocks, the people behind the science, the expertise and the blending process of cement drives the conversation about having globally competitive assets that can compete in any part of the globe as outlined by the vision of the National Human Resource Development Strategy. With over BWP120 million paid in taxes, imagine how big an impact the cement industry can be if all players had set up shop in-country.

A lot of good quality players have not seen enough of sunlight in many manufacturing industries, not because they cannot compete but because the products and services which were tailored for the market were overlooked for goods and services from far away. When FDIs come into Botswana they should have different strategic options of setting up not just green field where they start from scratch, they should have options of licensing, joint ventures and buying out local players. This will give a huge return to local players and their shareholders.  Indonesia has introduced industry protection for the same reasons. The Motor industry in South Africa is protected against grey imports. In Zimbabwe the cost of importing attracts 100% duty for specific goods which are available in-country.

Our philosophy of supporting local enterprise development, community building and CSI projects for SMMEs is our step of demonstrating that true value should include how players impact and influence SMMEs.  We have been part of the community growth and development with our signature rising buildings across the country, a testament to our quality management process. For close to half a century our buildings still stand.  Matsiloje, PPC and other local manufacturers have good products, the only thing left is for us to answer the question -what do we want to be. An import economy or a vibrant force of nature that is self-sustaining no matter what?

We are at a crossroads, if sings of Covid-19 are anything to go buy, the future of our manufacturing sector is buying local and enhancing capacity of our home-brewed brands. The avenues for new value frontiers are available. The question is -are we bold enough to take the vital steps to make it happen?

*Dumisani Ncube is Digital Executive at PR Practice

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Corporate

Cresta Group Sets Foot in Scenic Cape Town

16th April 2021
cresta

Home of Table Mountain and Robben Island now has one more four-star national wonder on their list, Cresta Grande Cape Town.

Cresta Marakanelo Limited was proud to support and celebrate its sister company Cresta Hotels, as they opened their doors to the scenic Cape Town hotel, the first time the hotel chain has operated in South Africa’s internationally renowned global tourism ‘capital’.

Cresta Marakanelo Limited operates 11 hotels in Botswana and 1 hotel in Lusaka, Zambia. Sister Company Cresta Hotels, operates 5 hotels in Zimbabwe; making the Cape Town property the 6th Hotel in the Cresta Hotels portfolio
The name Cresta Grande Cape Town is reflective of the magnitude and refinement of the 19-story establishment, which is situated in the heart of the Mother City.

“Cresta Grande Cape Town was formally opened on Thursday, April 15, 2021. We as Cresta Marakanelo Limited were very excited to be a part of the unveiling of the new addition to the Group.” stated Mokwena Morulane, Cresta Marakanelo Limited Managing Director.

Cresta Grande hotel has 242 elegant bedrooms, that provide scenic views of the Table Mountain and refreshing oceanic views a stone-throw away. A series of conference and banqueting rooms, a 24-hour café, bar and lounge, gymnasium, sauna and steam room, covered and access-controlled parking area, and outdoor swimming pool with sundeck make it ideal for both business leisure.

Travelers from all corners of the earth can now indulge in the beauty, class and exclusivity of yet another Cresta Group masterpiece. Experience authentic global modern metropolitan experience dovetailed with true African hospitality and bespoke service.

“If you yearn to savor scenic landscape views, aesthetic hotel features and superior service, then, come home to Cresta Grande Cape Town.” noted Jean Pierre Moggee, Cresta Grande Cape Town General Manager.

We are optimistic that the rollout of the COVID-19 vaccines will provide much needed stimulation of the local and international travel industry. Our priority as the tourism industry is to emphasise safety and get local and global economy firing again. This new addition to the Group will allow for experiences of True African Hospitality, where our guests can enjoy the scenic cosmopolitan Cape Town, enjoy a direct flight to, and stay with us at our Cresta Maun properties; providing the perfect Gateway to the Okavango Delta.

Travelers can further enjoy our Cresta Mowana Safari Resort & Spa, which is situated on the banks of the magical Chobe River. Our Cresta properties will continue to maintain extra cleaning protocols and minimal touchpoint experience and will ensure that staff and guests alike take all due COVID-19 precautions.” concludes Morulane.

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Business

BancABC’s new brand promise places prominence on enhanced customer experience 

30th March 2021
BANC-ABC

BancABC, the BSE-listed bank, today announced the launch of its new brand promise, “We Understand You” to further encapsulate the Bank’s commitment to its customers and their needs.

The rationale for the launch comes at a time that requires innovative and agile financial solutions in order to improve customer’s banking experience, deliver consistent quality service and solidify relationships established over the years.

Commenting on the launch, BancABC Managing Director, Kgotso Bannalotlhe said, “The launch of our new brand promise follows a deep dive into our employees, customers, partners, and investors’ expectations, which was prudent in order to understand their evolving needs.  We have taken heed of all the feedback received and remain committed to continuously seeking ways to offer improved products and services, reinventing financial solutions and above all, a seamless banking experience.”

The launch of the three year “We Understand You” campaign, comes on the back of the Bank’s 10th anniversary, and in these rapidly changing and tumultuous times, the Bank has moved with dexterity to fortify its value proposition to its customers. Through the launch of this new brand promise, the Bank seeks to strengthen its offerings within Retail, SMME and Corporate banking.

The Bank’s previous brand promise was “Changing For You” and has now evolved into the “We Understand You” that reflects BancABC’s commitment to understanding its customers’ needs, offering solutions for every stage of their life and business journey, as they strive towards achieving their financial goals.

In light of prioritizing customer experience, the Bank increased its transactional capabilities by launching a new 3D Secure programme called Verified by Visa. This online security protocol, which provides cardholders with an additional authentication layer that confirms the validity of their identity, prevents the unauthorised usage of payment cards. Additionally, BancABC introduced Contactless debit and credit cards, which give customers the convenience of making payments by simply tapping their card on contactless Point-of-Sale machines.

“These customer-centric solutions are a demonstration of our promise to positioning ourselves as the preferred bank for the people of Botswana. These are also proof points of the Bank’s efforts to enhance the transactional capabilities by offering customers hassle-free functionalities that encourage them to transact more; and as a result, improve the overall value proposition,” says Grace Setlhare-Mankanku, Head of Retail Banking.

BancABC also made significant efforts to increase its geographical footprint, by adding four new ATMs to its network at the various Sales and Service Centres across the country, to decrease traffic at the branches and services centres and provide customers with easy access to banking services.

To better serve customers who prefer remote banking and to promote social distancing practices, BancABC successfully its revamped mobile banking platform, SaruMoney which is accessible through USSD and as an App. The Bank continues to expand capabilities on the SaruMoney platform in line with its focus on innovative digital banking solutions.

Designed with the typical Botswana bank user’s needs in mind, SaruMoney has increased security features, ensuring safe, accessible, reliable, and universal movement of funds. Additionally, BancOnline, the state-of-the-art digital platform, tailor-designed for improving the digital banking experience for Commercial Banking customers has also helped spur growth in BancABC’s transactional volumes, further entrenching the Bank as Botswana’s bank of choice.

“We Understand You” is an outward expression to our customers and the communities we serve, and it affirms that we acknowledge them, hear them, and recognise their needs. This is particularly essential for us right now, as we are required to be nimble in order to adapt to market changes, trends, as well as customers’ dynamic needs.

I firmly believe that our new brand promise is a testament to our business’s ability to respond to the evolving market conditions while ensuring we deliver quality services for the next ten years and beyond,” concludes Bannalotlhe.

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Corporate

Digitalization safe to restore future economic challenges-Huawei

18th March 2021
Huwaei & Botho

Giant Information and Communications Technology service provider, Huawei Botswana and Botho University have established a partnership to bring a cutting-edge ICT gear to Botswana for the future use of teaching and research.

As the world continues to choke on COVID-19 contagious waves and economies declining, knowledge and digitalization could be key powers critical in bringing stability and fast restoration for both social and economic challenges, post the COVID-19 fever.

This was said by Huawei Botswana Managing Director, Ye Huihui, at the launch of Huawei Academy at Botho University on Thursday in Gaborone. Huawei Botswana has invested in the academy that will see two hundred students enrolled for ICT studies and research every year.

“Setting up the Huawei ICT Academy in partnership with Botho University was not an option, rather a must to enable the young generation to learn and use the expertise to safe work and also to bring economical balance to everyone. Huawei, as a solution in the global ICT space, we carry a lot of expertise from technology.

We established through our digitally linked business platform to build a robust internal knowledge community. We will be grateful to share our global cases to this nation and its citizens to help them to ease the way to the recovery process,” said Huihui.

Minister of Tertiary Education, Research, Science and Technology, Dr Douglas Letsholathebe shared the same sentiments, saying COVID-19 has rapidly morphed into an unprecedented health, economic, sociocultural and geopolitical crisis. The education minister says the impact on the educational sector resulted in the disruption of learning at all levels of education (as evident by the poor performance in the BGCSE).

“The use of ICT has taken precedence in order for institutions to stay afloat in the space of training for the knowledge-based economy. The need to increase access to off campus online teaching and learning is seen as a measure which can support the learning never stops initiative.”

The Fourth Industrial Revolution has the potential to raise global income levels and improve the quality of life for populations around the world. Technology, Letsholathebe says, has made possible new products and services that increase the efficiency and pleasure of people’s personal lives.

Huawei has provided fully equipped labs for the new academy and training materials for various courses worth P350 000. Through these labs, Botho University will target to train more than 200 students per year in the latest technologies such as routing and switching, cloud computing, internet of things, 5G technology, big data, storage and artificial intelligence. Further, students who have demonstrated interest in the ICT sector will get a chance to enrol for the various courses at Huawei Academy for free. The academy will host multiple creative learning resources such as books, lab guides, e-learning and online tests, along with various simulation tools.

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