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Climate change and COVID-19 

climate change

Designated as a climate “hotspot” by the Intergovernmental Panel on Climate Change, Southern Africa is prone to recurrent extreme climatic shocks such as droughts and flooding. The findings appear in the newly published Synthesis Report on the State of Food and Nutrition Security and Vulnerability in Southern Africa 2021.

Countries in the eastern parts of the region are particularly vulnerable to cyclones – three tropical storms or hurricanes made landfall in eastern parts of the area during the 2020/21 season. In the past five years, many parts of the region experienced recurrent droughts.

The report indicated that climate-induced shocks and hazards are linked to reduced agricultural production, displacement of people, damage to homes and critical infrastructure, and disease outbreaks such as malaria and cholera.

“Many parts of the region experienced good rainfall in only two of the last six cropping seasons. One of these two good seasons was the 2020/21 rainfall season when normal to above-normal rainfall was received in most areas, prompting good regional crop production expectations.

However, in western parts of the region and southern Madagascar, prolonged poor rainfall resulted in severe drought, significantly impacting crop production,” reads part of the report.
Despite the generally good rains received in many areas this season, the study alleged that repeated extreme climatic shocks observed in the recent past across the region mean that the part remains at risk of high rates of acute food insecurity if effective interventions are not implemented.

The most pronounced manifestations of climate change and variability in the region include an increase in temperature, leading to increased heat stress and reduced crop yields, changes in rainfall patterns: increasingly erratic rainfall events of high intensity, leading to floods and more frequent droughts and dry spells, delayed onset of the rainfall season and an early tailing off, thus reducing the growing period for crops and climate variability and change, coupled with human-induced modifications, may also affect ecosystems, e.g., mangroves and coral reefs, with additional consequences for fisheries and tourism.

Some Member States experienced localized prolonged dry spells in this report, including Angola, DRC, Namibia, Madagascar, and Mozambique. Food security in affected areas has worsened compared to last year, with increased acute malnutrition.

“In Angola, rainfall was 60-80% below average over the cereal-producing provinces of Namibe, Cunene, Huila, and Cuanza. In most southwestern areas, this was the driest season experienced since 1981. The dry season resulted in stressed vegetation conditions and a reduction in the availability of water for livestock. At the start of the harvest in March, a significant cereal production decrease was forecast, particularly in maize,” the study said.

By March 2021, farmers in the Southern and Central regions of Angola reported more than 45% production losses due to drought. The losses were due to a marked increase in AML swarms between January and March 2021 in south-eastern parts of the country, mainly in Cuando Cubango Province.

Over the southern regions of Madagascar, specifically Androy, Anosy, and Atsimo Andrefana, monthly rainfall amounts between October 2020 and March 2021 were significantly below average.  In some of these areas, the season was one of the driest since at least 1981. These conditions have led to severe drought and severe crop failure. Adverse effects can be observed in pasture availability and quality, with 60-70% of grasslands already affected by drought conditions, deterioration of livestock, and decreasing seed availability.

Insufficient rainfall, farmers’ low financial coping capacity, and the effects of COVID-19 have led to a sharp deterioration in the food security situation, with prices of commodities such as rice increasing by 7%. This is the second consecutive drought being experienced in parts of southern Madagascar, following the poor 2019/20 season, thereby putting considerable strain on the coping capacity of households.

Despite the unfavorable rainfall that has affected some parts of the region, most areas have experienced good rain conducive to crop development. The normal to above-normal rainfall received in many areas this season has been conducive to crop development, and favourable crop conditions have been noted in the several Member States.

The study said the crop production outlook is generally positive, with some countries expecting bumper harvests. The high rainfall in many areas has also positively impacted forage for livestock, with significant improvement in vegetation conditions, including in some areas which had previously been affected by recurrent episodes of drought in previous years.

BOTSWANA CASE

The report said rains were generally favourable, but the agricultural yield is expected to be lower than last year. A total of 236,292 ha has been cultivated by 58,443 farmers, of which 32,382 are women. It further underlined that pasture conditions are good but may degrade during winter and requires monitoring.

A total of 36,171 Batswana are food insecure and prone to other vulnerabilities, a 3% increase from last year. Contributing factors include increased unemployment, low business earnings, and an economic slowdown.

According to the study, the government will assist those food insecure through inclusion in one of its social safety nets. Improvements in health education on hygiene and sanitation have contributed to a slight reduction in child malnutrition (measured by underweight).

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Business

5 Best Forex Trading Brokers in Botswana for beginners

17th August 2022

Botswana is a leading economy in Sub-Saharan Africa, and this environment has contributed to the growth of Forex trading amongst young investors in Botswana.

Beginner traders must sign up with a regulated Forex broker that offers a safe trading environment and a wealth of resources. Here, we have listed the 5 best Forex brokers for beginner traders in Botswana.

 

1. AvaTrade

Overview

AvaTrade is a reputable broker that features an interface that makes copy trading easy to use for beginners. Customers of AvaTrade have access to a variety of trading platforms. AvaTrade is considered a leading broker, when compared to rivals such as with AvaTrade vs. eToro.

Manual traders have access to both the mobile interface AvaTradeGo and the popular desktop platform MetaTrader4 (MT4). AvaTradeGo is a mobile version of MT4.

 

Pros and Cons

PROSCONS
Broad range of tradable instrumentsHigh EURUSD and inactivity fees
MetaTrader 4 and 5 available 
Excellent educational resources 

 

 

Features

FeatureInformation
RegulationCentral Bank of Ireland, MiFID, ASiC, BVI
Minimum deposit from$100
Average spread from0.9 pips
Commissions fromNo commission on Forex
Deposit/Withdrawal FeesNone
Maximum Leverage1:400
BonusesFirst Deposit Bonus
Customer Support24/5 – multilingual

 

 

2. Exness

Overview

Exness is an excellent choice for Forex trading in Botswana, especially for those looking for a low-cost broker they can trust. When opening an account with them, prospective traders in Botswana can take advantage of a Forex no deposit bonus, as Exness is widely regarded as one of the best Forex brokers in the country.

 

Pros and Cons

PROSCONS
Well-regulated 
Tight spreads 
Over 130 currency pairs 

 

 

Features

FeatureInformation
RegulationCySEC, FCA
Minimum deposit from$1
Average spread from1.3 pips
Commissions from3 USD and 10 USD per 1 lot for CFDs
Deposit/Withdrawal FeesNone
Maximum Leverage1:2000
BonusesStandard +10% Bonus Programme
Customer Support24/5 – multilingual

 

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3.Pepperstone

Overview

Since its founding in 2010, Pepperstone has experienced rapid growth. Both CFD and FX traders can take advantage of low spreads, fast support, and a variety of third-party platforms, including several social copy trading options.

 

Pros and Cons

Pros

 

No minimum deposit

Low trading fees for forex

No added costs for withdrawals or deposits

 

Cons

 

Limited number of instruments

No additional research tools

 

 

 

Features

FeatureInformation
RegulationFCA, ASIC
Minimum deposit fromAUD200
Average spread from0.4 pips
Commissions from‎$3.76 commission per lot per trade
Deposit/Withdrawal FeesNone
Maximum Leverage1:500
BonusesNone
Customer Support24/5

 

 

4.OctaFX

Overview

OctaFX is an electronic communication network (ECN) Forex broker that facilitates CFD trading in a wide range of underlying assets. In addition to its many trading accounts, OctaFX also offers extensive research tools, copy trading, bonus promotions, and more.

 

Pros and Cons

PROSCONS
Ultra-fast executionNo VPS available
More than 30 forex pairs available

Well-regulated

 

No Forex educational tools

 

Features

FeatureInformation
RegulationCySEC
Minimum deposit from$100
Average spread from0.7 pips
Commissions from None
Deposit/Withdrawal FeesNone
Maximum Leverage1:500
Bonuses50% Deposit Bonus
Customer Support24/5

 

 

5.XM

Overview

A common name in the field of foreign exchange, XM is a household brand. Trading on XM’s improved MetaTrader 4 and MetaTrader 5 platform provides access to over a thousand assets at competitive costs.

 

Pros and Cons

Pros

Low minimum deposit

Comprehensive educational offering

Streamlined account opening process

 

Cons

Inactivity fee charged after 90 days on live accounts

Limited product portfolio

 

 

 

Features

FeatureInformation
RegulationIFSC, ASIC, CySEC, FCA and DFSA
Minimum deposit from$5
Average spread from0.1 pips
Commissions from$3.5 commission per $100 000 traded
Deposit/Withdrawal FeesNone
Maximum Leverage1:30
Bonuses$30 Trading Bonus
Customer Support24/5

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Business

New study reveals why youth entrepreneurs are failing

21st July 2022
Youth

The recent study on youth entrepreneurship in Botswana has identified difficult access to funding, land, machinery, lack of entrepreneurial mindset and proper training as serious challenges that continue to hamper youth entrepreneurship development in this country.

The study conducted by Alliance for African Partnership (AAP) in collaboration with University of Botswana has confirmed that despite the government and private sector multi-billion pula entrepreneurship development initiatives, many young people in Botswana continue to fail to grow their businesses into sustainable and successful companies that can help reduce unemployment.

University of Botswana researchers Gaofetege Ganamotse and Rudolph Boy who compiled findings in the 2022 study report for Botswana stated that as part of the study interviews were conducted with successful youth entrepreneurs to understand their critical success factors.

According to the researchers other participants were community leaders, business mentors, Ministry of Trade and Industry, Ministry of Youth, Gender, Sport and Culture, financial institutions, higher education institutions, non-governmental institutions, policymakers, private organizations, and support structures such as legal and technical experts and accountants who were interviewed to understand how they facilitate successful youth entrepreneurship.

The researchers said they found that although Botswana government is perceived as the most supportive to businesses when compared to other governments in sub-Saharan Africa, youth entrepreneurs still face challenges when accessing government funding. “Several finance-related challenges were identified by youth entrepreneurs. Some respondents lamented the lack of access to start-up finance, whereas others mentioned lack of access to infrastructure.”

The researchers stated that in Botswana entrepreneurship is not yet perceived as a field or career of choice by many youth “Participants in the study emphasized that the many youth are more of necessity entrepreneurs, seeing business venturing as a “fall back. Other facilitators mentioned that some youth do not display creativity, mind-blowing innovative solutions, and business management skills. Some youth entrepreneurs like to take shortcuts like selling sweets or muffins.”

According to the researchers, some of the youth do not display perseverance when they are faced with adversity in business. “Young people lack of an entrepreneurial mindset is a common challenge among youth in business. Some have a mindset focused on free services, handouts, and rapid gains. They want overnight success. As such, they give up easily when faced with challenges. On the other hand, some participants argue that they may opt for quick wins because they do not have access to any land, machinery, offices, and vehicles.”

The researchers stated that most youth involved in business ventures do not have the necessary training or skills to maintain a business. “Poor financial management has also been cited as one of the challenges for youth entrepreneurs, such as using profit for personal reasons rather than investing in the business. Also some are not being able to separate their livelihood from their businesses.

Lastly, youth entrepreneurs reported a lack of experience as one of the challenges. For example, the experience of running a business with projections, sticking to the projections, having an accounting system, maintaining a clean and clear billing system, and sound administration system.”

According to the researchers, the participants in the study emphasized that there is fragmentation within the entrepreneurial ecosystem, whereby there is replication of business activities without any differentiation. “There is no integration of the ecosystem players. As such, they end up with duplicate programs targeting the same objectives. The financial sector recommended that there is a need for an intermediary body that will bring all the ecosystem actors together and serve as a “one-stop shop” for entrepreneurs and build mentorship programs that accommodate the business lifecycle from inception to growth.”

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Business

BHC yearend financial results impressive

18th July 2022
BHC

Botswana Housing Corporation (BHC) is said to have recorded an operating surplus of P61 Million, an improvement compared to the previous year. The housing, office and other building needs giant met with stakeholders recently to share how the business has been.

The P61 million is a significant increase against the P6 million operating loss realized in the prior year. Profit before income tax also increased significantly from P2 million in the prior year to P72 million which resulted in an overall increase in surplus after tax from P1 million prior year to P64 million for the year under review.

Chief of Finance Officer, Diratsagae Kgamanyane disclosed; “This growth in surplus was driven mainly by rental revenue that increased by 15% from P209 million to P240 million and reduction in expenditure from P272 million to P214 million on the back of cost containment.”
He further stated that sales of high margin investment properties also contributed significantly to the growth in surplus as well as impairment reversals on receivables amounting to P25 million.

It is said that the Corporation recorded a total revenue of P702 million, an 8% decrease when compared to the P760 million recorded in the prior year. “Sales revenue which is one of the major revenue streams returned impressive margins, contributing to the overall growth in the gross margin,” added Kgamanyane.

He further stated professional fees revenue line declined significantly by 64% to P5 million from P14 million in the prior year which attributed to suspension of planned projects by their clients due to Covid-19 pandemic. “Facilities Management revenue decreased by P 24 million from P69 million recorded in prior year to P45 million due to reduction in projects,” Kgamanyane said.

The Corporation’s strength is on its investment properties portfolio that stood at P1.4 billion at the end of the reporting period. “The Corporation continues its strategy to diversify revenue streams despite both facilities management income and professional fees being challenged by the prevailing economic conditions that have seen its major clients curtailing spending,” added the CEO.

On the one hand, the Corporation’s Strategic Performance which intended to build 12 300 houses by 2023 has so far managed to build 4 830 houses under their SHHA funding scheme, 1 240 houses for commercial or external use which includes use by government and 1 970 houses to rent to individuals.

BHC Acting CEO Pascaline Sefawe noted that; BHC’s planned projects are said to include building 336 flat units in Gaborone Block 7 at approximately P224 million, 100 units in Maun at approximately P78 million, 13 units in Phakalane at approximately P26 million, 212 units in Kazungula at approximately P160 million, 96 units at approximately P42 million in Francistown and 84 units at approximately P61 million in Letlhakane. Emphasing; “People tend to accuse us of only building houses in Gaborone, so here we are, including other areas in our planned projects.”

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