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Water Utilities losses up 232% to P166 Million

Water Utilities Corporation (WUC) has released their financial results for the full year ended 31st March 2021. Figures reveal ballooned losses for the state-owned corporation. Losses went up by 232% from P49.9 million in the previous year ended March 2020 to P166 million in the period under review.

The 31st March 2021 year-end was underpinned by devastating effects of the COVID-19 pandemic, in particular: eroded household income resulting in inability to pay water bills by customers on top of high consumption of water due to COVID-19 prevention measure of regular washing of hands. In April 2020 President Mokgweetsi Masisi declared State of Public Emergency to curb the spread of the COVID-19 pandemic in Botswana. A directive was further issued to Water Utilities Corporation to suspend disconnection of defaulting customers and keep the taps running in order to enable regular washing of hands.

However, this landed a massive blow on the corporation’s financials. Revenue from contracts with customers dropped to P1.811 billion from P1.825 billion. The corporation’s total expenses rose from P1.988 billion to P2.307 billion resulting in operating loss before tariff subsidies and grants of P465.9 million up significantly from P138.8 million recorded in the previous year ended 31st March 2020. Grant received from government was just a little over P167 million, a significant rise from P147 million received in the previous year.

After taking into account revenue from grant and tarrif subsidy Water Utilities Corporation operating loss stood at P298.6 million, still significantly higher than the March 2020 loss of P8.5 million. Loss for the year ended 31st March 2021 after Finance Income, Cost and Income tax stood at P166,043, 000 up 232% from P49,923,00 in the previous year ended 31st March 2020. Water Utilities Corporation’s biggest thorn on its flesh is defaulting customers who owe the corporation chunks of money.

In July, this year, Water Utilities Corporation (WUC) announced that it will step up its debt collection efforts in a bid to recover over P1.1 billion owed by its customers. The corporation, which is a parastatal under Ministry of Land Management, Water & Sanitation Services had been crying out loud appealing to members of the public and companies to pay their respective water bills.

Over the years WUCs technique has been to cut individuals water supply in a bid to force the customers to pay outstanding bills, however the strategy doesnt seem to work forcing the corporation to come up with other avenues to press water consumers into paying for the service which is the crust of everyday basic need. Water Utilities said unpaid bills that continue to pile up year in year out have now reached unbearable heights, levels so high that it can no longer absorb the heat.

The corporation announced on national television that it has now decided to engage debt collectors to go after people and companies that owe them a total of over P1.1 billion in unpaid bills. According to information revealed by the Corporation management, over P700 million is owed by the public or domestic users, while the remaining P400 million is owed by companies and organisations. Lebone Sedingwe a Revenue Executive at Water Utilities revealed in July that it was long overdue for the corporation to go after those reluctant to pay up for their bills.

Sedingwe said some customers would come to their revenue offices to negotiate and agree on payment plans, but thereafter never stick to it. It is under this backdrop that we have seen it is only best we engage those with skills to collect this debt on our behalf because it is too much, Sedingwe said in July. Permanent Secretary in the Ministry of Land Management, Water and Sanitation Services, Bonolo Khumotaka mid last year at the height of COVID-19 outbreak appealed to Water Utilities Corporation customers urging them to pay their outstanding water bills.

She said this would help the Corporation to recover costs and ensure it continues to deliver water to the nation. During COVID-19 lockdown WUC was only able to collect around P50 million per month from utility fees instead of the usual P150 million, a trend that spilled over to the rest of the year and the following year 2021 as economic hardship prevailed, curtailing peoples ability to pay their bills.

When COVID-19 intensified last year President Dr Mokgweetsi Eric Masisi instructed WUC to suspend its process of disconnecting water supply for defaulting customers. President Masisi indicated that the decision was imperative and necessary to enable Batswana to comply with COVID-19 protocols and requirements of hygiene and washing hands regularly. On the other hand, the Ministrys Permanent Secretary cried foul that Water Utilities was suffocating due to overwhelming operating costs that are not recovered.

We encourage all those who can pay their water bills to do so, this will enable us to continue servicing the country with the much-needed water during this period of COVID-19 pandemic, she said over a year ago. The Permanent Secretary further noted that it is crucial for WUC customers to pay their bills so that the Corporation recovers costs and keeps its workforce. Distributing water is expensive because we have to maintain our pipes and pumps to keep the water supply afloat. We appeal to Batswana to meet us half-way, even if it means paying half of the bill, it is very much welcome, she pleaded.

Khumotaka further added: The Corporation is employing Batswana, so for us to avoid cutting costs and coming to drastic decisions such as laying off some employees, it is important that we recover costs from Batswana who can afford to pay their bills. We have come up with new payment platforms, including digital and cell phone payments methods to make it easy for our customers to pay, she advised. In October, following the lifting of State of Emergency Water Utilities Corporation announced that the grace period given to customers with unpaid water bills would cease end of October issuing a serious warning that 1st of November penalty actions would be in full momentum.


Banking on Your Terms: Exploring the World of Self-Service Banking

23rd February 2024

In today’s digital age, banking is no longer just about visiting a branch during business hours. It’s about putting you, the customer, in the driver’s seat of your financial journey. But what exactly is self-service banking, and how do you stand to benefit from it as a customer?

Self-service banking is all about giving you the power to manage your finances on your terms. Whether you want to check your account balance at midnight, transfer money while on vacation, or deposit cash without waiting in line, self-service banking makes it possible. It’s like having a virtual branch at your fingertips, ready to assist you 24/7.

This shift towards self-service banking was catalyzed by various factors but it became easily accessible and accepted during the COVID-19 pandemic. People of all ages found themselves turning to digital channels out of necessity, and they discovered the freedom and flexibility it offers.

Anyone with a bank account and access to the internet or a smartphone can now bank anywhere and anytime. Whether you’re a tech-savvy millennial or someone who’s less comfortable with technology, you as the customer have the opportunity to manage your finances independently through online banking portal or downloading your bank’s mobile app. These platforms are designed to be user-friendly, with features like biometric authentication to ensure your transactions are secure.

Speaking of security, you might wonder how safe self-service banking really is. Banks invest heavily in encryption and other security measures to protect your information. In addition to that, features like real-time fraud detection and AI-powered risk management add an extra layer of protection.

Now, you might be thinking, “What’s the catch? Does self-service banking come with a cost?” The good news is that for the most part, it’s free. Banks offer these digital services as part of their commitment to customer satisfaction. However, some transactions, like wire transfers or expedited bill payments, may incur a small service fee.

At Bank Gaborone, our electronic channels offer a plethora of services around the clock to cater to your banking requirements. This includes our Mobile App, which doesn’t require data access for Orange and Mascom users. We also have e-Pula Internet Banking portal, available at as well as Tobetsa Mobile Banking which is accessible via *187*247#. Our ATMs also offer the flexibility of allowing you to deposit, withdraw cash, and more.

With self-service banking, you have the reins of your financial affairs, accessible from the comfort of your home, workplace, or while you’re on the move. So why wait? Take control of your finances today with self-service banking.

Duduetsang Chappelle-Molloy is Head: Marketing and Corporate Communication Services


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Botswana records over P6 billion trade deficit

7th February 2024

Botswana has recently recorded a significant trade deficit of over P6 billion. This trade deficit, which occurred in November 2023, follows another deficit of P4.7 billion recorded in October of the same year. These figures, released by Statistics Botswana, highlight a decline in export revenues as the main cause of the trade deficit.

In November 2023, Botswana’s total export revenues amounted to P2.9 billion, a decrease of 24.3 percent from the previous month. Diamonds, a major contributor to Botswana’s exports, experienced a significant decline of 44.1 percent during this period. This decline in diamond exports played a significant role in the overall decrease in export revenues. However, diamonds still remained the leading export commodity group, contributing 44.2 percent to export revenues. Copper and Machinery & Electrical Equipment followed, contributing 25.8 percent and 10.1 percent, respectively.

Asia emerged as the leading export market for Botswana, receiving exports worth P1.18 billion in November 2023. The United Arab Emirates, China, and Hong Kong were the top destinations within Asia, receiving 18.6 percent, 14.2 percent, and 3.8 percent of total exports, respectively. Diamonds and Copper were the major commodity groups exported to Asia.

The Southern African Customs Union (SACU) received Botswana’s exports worth P685.7 million, with South Africa being the main recipient within SACU. The European Union (EU) received exports worth P463.2 million, primarily through Belgium. Australia received exports worth P290 million, while the United States received exports valued at P69.6 million, mostly composed of diamonds.

On the import side, Botswana imported goods worth P9.5 billion in November 2023, representing an increase of 11.2 percent from the previous month. The increase in imports was mainly driven by a rise in Diamonds and Chemicals & Rubber Products imports. Diamonds contributed 23.3 percent to total imports, followed by Fuel and Food, Beverages & Tobacco at 19.4 percent and 15.0 percent, respectively.

The SACU region was the top supplier of imports to Botswana, accounting for 77.7 percent of total imports. South Africa contributed the largest share at 57.2 percent, followed by Namibia at 20.0 percent. Imports from Asia accounted for 9.8 percent of total imports, with Diamonds, Machinery & Electrical Equipment, and Chemicals & Rubber Products being the major commodity groups imported. The EU supplied Botswana with imports worth 3.2 percent of total imports, primarily in the form of Machinery & Electrical Equipment, Diamonds, and Chemicals & Rubber Products.

Botswana’s recent trade deficit of over P6 billion highlights a decline in export revenues, particularly in the diamond sector. While Asia remains the leading export market for Botswana, the country heavily relies on imports from the SACU region, particularly South Africa. Addressing the trade deficit will require diversification of export markets and sectors, as well as efforts to promote domestic industries and reduce reliance on imports.





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Business sector optimistic about 2024

7th February 2024

The business sector in Botswana is optimistic about the year 2024, according to a recent survey conducted by the Bank of Botswana (BoB). The survey collected information from businesses in various sectors, including agriculture, mining, manufacturing, construction, and finance, among others. The results of the survey indicate that businesses expect trading conditions to improve in the first quarter of 2024 and remain favorable throughout the year.

The researchers found that firms anticipate improvements in investment, profitability, and goods and services exported in the fourth quarter of 2023 compared to the previous quarter. These expectations, combined with anticipated growth in all sectors except construction and real estate, contribute to the overall confidence in business conditions. Furthermore, businesses expect further improvements in the first quarter of 2024 and throughout the entire year.

Confidence among domestic market-oriented firms may decline slightly in the first quarter of 2024, but overall optimism is expected to improve throughout the year, consistent with the anticipated domestic economic recovery. Firms in sectors such as mining, retail, accommodation, transport, manufacturing, agriculture, and finance are driving this confidence. Export-oriented firms also show increased optimism in the first quarter of 2024 and for the entire year.

All sectors, except agriculture, which remains neutral, are optimistic about the first quarter of 2024 and the year ending in December 2024. This optimism is likely supported by government interventions to support economic activity, including the two-year Transitional National Development Plan (TNDP) and reforms aimed at improving the business environment. The anticipated improvement in profitability, goods and services exported, and business investment further contributes to the positive outlook.

Firms expect lending rates and borrowing volumes to increase in the 12-month period ending in December 2024. This increase in borrowing is consistent with the expected rise in investment, inventories, and goods and services exported. Firms anticipate that domestic economic performance will improve during this period. Domestic-oriented firms perceive access to credit from commercial banks in Botswana to be relaxed, while export-oriented firms prefer to borrow from South Africa.

During the fourth quarter of 2023, firms faced high cost pressures due to increased input costs, such as materials, utilities, and transport, resulting from supply constraints related to conflicts in Ukraine-Russia and Israel-Hamas. According to the survey report, the firms noted that cost pressures during the fourth quarter of 2023 were high, mainly attributable to increase in some input costs, such as materials, utilities, and transport arising from supply constraints related to the Ukraine-Russia and Israel-Hamas wars. “However, firms’ expectations about domestic inflation decreased, compared to the previous survey, and have remained within the Bank’s 3 – 6 percent objective range, averaging 5.4 percent for 2023 and 5.4 percent for 2024. This suggests that inflation expectations are well anchored, which is good for maintenance of price stability,” reads the survey report in part.

However, firms’ expectations about domestic inflation decreased compared to the previous survey, and inflation expectations remained within the Bank’s objective range of 3-6 percent. This suggests that inflation expectations are well anchored, which is beneficial for maintaining price stability.

In terms of challenges, most firms in the retail, accommodation, transport, manufacturing, construction, and finance sectors considered the exchange rate of the Pula to be unfavorable to their business operations. This is mainly because these firms import raw materials from South Africa and would prefer a stronger Pula against the South African rand. Additionally, firms in the retail, accommodation, transport, and mining sectors cited other challenges, including supply constraints from conflicts in Russia-Ukraine and Israel-Hamas, as well as new citizen economic empowerment policies that some firms considered unfavorable to foreign direct investment.

On the positive side, firms highlighted factors such as adequate water and electricity supply, a favorable political climate, an effective regulatory framework, the availability of skilled labor, and domestic and international demand as supportive to doing business in Botswana during the fourth quarter of 2023.

Overall, the business sector in Botswana is optimistic about the year 2024. The anticipated improvements in trading conditions, supported by government interventions and reforms, are expected to drive growth and profitability in various sectors. While challenges exist, businesses remain confident in the potential for economic recovery and expansion.










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