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P100 million Milk Afric project awaits Dubai investors

Milk-Afric

Botswana Development Corporation (BDC) has already spent P54.2 million out of P92 million approved fund for the Milk Afric project that was initially supposed to have started in 2016.

The next move remains uncertain, following the lapse of the Memorandum of Agreement (MoA) between them and the technical partner that was identified. BDC first came onboard as equity partner, but took over when the promoters exited the project in 2020.

BDC is now pinning its hopes on undisclosed Dubai investors who visited the Milk Afric farm during their visit to Botswana and have since expressed interest in the project. While BDC hopes the prospective investors will eventually agree terms with them, no timelines have been discussed on the commencement of the project

The corporation said that over 60 percent of the funds allocated for the project have gone into the development of the infrastructure, largely construction of rotary and cooling taking, borehole drilling and equipping, power connection and backups. BDC said that the remaining is for working capital needs. BDC insists that no jobs have been lost as a result of previous partner abandoning the projects.

“No jobs have been lost, however, some employees have, out of personal interest, gone to pursue other career interests,” said Boitswarelo Lebang-Kgetse, Head of Corporate Affairs and Strategy.
“BDC has maintained eight employees of the project on-board and continues to engage them for work including maintaining the infrastructure, whilst the project awaits commencement. At full capacity, the project will create approximately 215 jobs.”

The government investment arm said, timelines on the commencement of the project will be discussed and finalized with the prospective partners once identified and BDC also stated that discussions on the role of the investors are still at preliminary stages.

Recently, Lobatse Mayor, Essop Pandor told the full council that his office was informed that negotiations between BDC and its Technical Partner, who was identified in June 2021, have lapsed in May this year after one-month extension.

He told the full council that BDC is to date reassessing its position on the prospective partnership following significant deviations from the original proposal by the technical partner and the slow progress in committing to the advancement of the project by the technical partner.

“Despite this, as another alternative, BDC has also been engaging with the Dubai investors who visited the Milk Afric farm during their visit to Botswana and have since expressed interest in the project,” Pandor said at a full council meeting last month.

He indicated that discussions were held cognizant of the current Memorandum of Understanding and its conditions. “Furthermore, be informed that implementation of Milking Plan has just been approved in March 2022, the purpose of the plan is to develop all remaining infrastructure such that the farm can be ready to house animals and start operations once cows are identified.”

He said that Dairy Specialist has also been engaged and has to date reviewed the plans and advised on what has to be considered prior to commencement of construction and that It is envisaged that developments will commence before the end of this month.

Pandor indicated that the continued importation ban on cloven hooved animals from South Africa due to the Foot & Mouth outbreak continues to be an obstacle to sourcing cheaper cows from South Africa. He further stated that BDC and Milk Afric are in discussions with consultants to identify other cows in different countries which are not in the FMD red zone and to explore a solution of utilizing embryos in host cows.

However there have been a lot of issues surrounding the project. Back in 2013 the company (Milk Afric) signed a memorandum of understanding with Local Enterprise Authority (LEA) which was said to be a beginning of a new era in the dairy industry .The MOU was also said to promote growth in the dairy industry.

In 2016, the Directorate of Corruption and Economic Crime (DCEC) investigated the company over issues of corruption as some government employees that were sent to study dairy production in America had their scholarships terminated before the completion of their course.

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