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Industrialization tops SACU meeting in Botswana

The Southern African Customs Union (SACU) meeting to be hosted on the 12-13 April in Gaborone is expected to focus on promoting industrialization at SACU member states, being Botswana, South Africa, Lesotho Namibia and eSwatini.

In a recent statement, SACU indicated that following disagreements among member states, regarding review of the revenue sharing formula, the union decided to focus on promoting industrialization and other issues that would enhance cooperation among SACU member states.
SACU collects revenues made up of custom and excise duties that each country collects when they import from outside the bloc and from each other. The revenues which accumulate into customs revenue pool are shared by SACU member states once a year.

According to SACU, revenue sharing formula has three components being the customs component, excise component and the development component. SACU stated that the customs share is allocated based on each country’s share of total intra-SACU imports while the excise component constitutes 85% of the excise duties collected and it is allocated based on each countrys share of the total SACU Gross Domestic Product (GDP).

SACU added that the developmental component is weighted in favour of the less developed member states. It has emerged that SA always gets the lion share from the revenue pool, as the country is the first point of entry for most imports destined for Botswana, eSwatini, Lesotho and Namibia. SA collects the highest amount of revenues from the revenue pool due to its strategic location in terms of seaports, the level of development and size of the economy. According to SACU Agreement, customs and excise duties from imports into the region are collected at the first point of entry.

SACU member states are failing to reach consensus, following proposal that SACU should review the current revenue sharing formula and adopt compensatory revenue sharing formula that would favor other less developed member states. SA disagreed with the compensatory formula, saying its unfair as it penalizes the country for being the most industrialized SACU member states and it is done in favour of less industrialized member states.

In the recent statement, SACU Executive Secretary Paulina Mbala Elago said SACU has decided that following the disagreements regarding revenue sharing formula, the customs union will focus on promoting industrialization among SACU member states. For years we have attempted to review the revenue sharing formula among other difficult matters in the union. We achieved limited progress due to fundamental disagreements amongst member states.

As such the SACU Council, in its wisdom, chose to refocus the work programme on those issues that will enhance cooperation and would propel our development aspirations. I can confidently say that the work we are implementing now, focusing on industrialization, indeed represents notable progress and attainable development prospects for our Union, said the Executive Secretary.

Elago stated that the April SACU meeting in Botswana is expected to focus on promoting industrialization as it intends to showcase and profile the regions development potential as well as investment and export opportunities in the targeted priority sectors; agro-processing, textiles and clothing as well as pharmaceuticals, cosmetics and essential oils. The meeting will also provide the private sector and industry players a unique opportunity to engage SACU Trade Ministers and policy makers on measures and possible interventions that will enable the development of cross-border value chains so as to take full advantage of the market access opportunity presented by the AfCFTA, she said.

She said the African Continental Free Trade Area (AfCFTA signed in 2019 comes with good opportunities for businesses in SACU, as it would allow SACU countries to access one of the biggest markets with 1.3 billion people and a combined GDP of $3.4 trillion in Africa. For SACU, the key is to position ourselves as an industrial and manufacturing hub to take advantage of the opportunities presented by the AfCFTA, she said.

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China’s GDP expands 3% in 2022 despite various pressures

2nd February 2023
China’s Gross Domestic Product (GDP) expanded by 3% year-on-year to 121.02 trillion yuan ($17.93 trillion) in 2022 despite being mired in various growth pressures, according to data from the National Bureau Statistics.

The annual growth rate beat a median economist forecast of 2.8% as polled by Reuters. The country’s fourth-quarter GDP growth of 2.9% also surpassed expectations for a 1.8% increase.

In 2022, the Chinese economy encountered more difficulties and challenges than was expected amid a complex domestic and international situation. However, NBS said economic growth stabilized after various measures were taken to shore up growth.

Industrial output rose 3.6% in 2022 over the previous year, while retail sales slightly shrank by 0.2% data show that fixed-asset investment increased 5.1% over 2021, with a 9.1% hike in manufacturing investment but a 10% fall in property investment.

China created 12.06 million new jobs in urban regions throughout the year, surpassing its annual target of 11 million, and officials have stressed the importance of continuing an employment-first policy in 2023.

Meanwhile, China tourism market is a step closer to robust recovery. Tourism operators are in high spirits because the market saw a good chance of a robust recovery during the Spring Festival holiday amid relaxed COVID-19 travel policies.

On January 27, the last day of the seven-day break, the Ministry of Culture and Tourism published an encouraging performance report of the tourism market. It said that domestic destinations and attractions received 308 million visits, up 23.1% year-on-year. The number is roughly 88.6% of that in 2019, they year before the pandemic hit.

According to the report, tourism-related revenue generated during the seven-day period was about 375.8 billion yuan ($55.41 billion), a year-on-year rise of 30%. The revenue was about 73% of that in 2019, the Ministry said.

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Jewellery manufacturing plant to create over 100 jobs

30th January 2023

The state of the art jewellery manufacturing plant that has been set up by international diamond and cutting company, KGK Diamonds Botswana will create over 100 jobs, of which 89 percent will be localized.

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Investors inject capital into Tsodilo Resources Company

25th January 2023

Local diamond and metal exploration company Tsodilo Resources Limited has negotiated a non-brokered private placement of 2,200, 914 units of the company at a price per unit of 0.20 US Dollars, which will provide gross proceeds to the company in the amount of C$440, 188. 20.

According to a statement from the group, proceeds from the private placement will be used for the betterment of the Xaudum iron formation project in Botswana and general corporate purposes.

The statement says every unit of the company will consist of a common share in the capital of the company and one Common Share purchase warrant of the company.

Each warrant will enable a holder to make a single purchase for the period of 24 months at an amount of $0.20. As per regularity requirements, the group indicates that the common shares and warrants will be subject to a four month plus a day hold period from date of closure.

Tsodilo is exempt from the formal valuation and minority shareholder approval requirements. This is for the reason that the fair market value of the private placement, insofar as it involves the director, is not more than 25% of the company’s market capitalization.

Tsodilo Resources Limited is an international diamond and metals exploration company engaged in the search for economic diamond and metal deposits at its Bosoto Limited and Gcwihaba Resources projects in Botswana.  The company has a 100% stake in Bosoto which holds the BK16 kimberlite project in the Orapa Kimberlite Field (OKF) in Botswana.

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