Parley approves P5bln bond

10 March, 2008 in Botswana, Business

source: Mmegi

WANETSHA MOSINYI
STAFF WRITER

Parliament has approved a government rollout of a bond issuance programme of up to P5billion in order to stimulate liquidity in capital markets.

This follows an appeal to Parliament to approve the bond issuance in line with government’s effort to support the development of domestic capital markets with a regular programme of issue and re-issue of government bonds by the Minister of Finance and Development Planning Baledzi Gaolathe last Wednesday.

In his 2008/09 Budget Speech, Gaolathe said a mix of maturities would replace the five-year bond that matures at the end of this month. The plan is to establish and maintain government’s presence in the bond market over the full range of maturities, from six-month treasury bills to 12-year bond maturities.

A further round after the March issuance will follow the mix of maturities for issue in September this year. The Minister said the [continue reading]

Bank of Botswana`s new inflation target a tall order

10 March, 2008 in Botswana, Business

source: Sunday Standard

by Sunday Standard Reporter
01.03.2008 12:32:55 P

Linah Mohohlo, the Central Bank governor made a disparate appeal last week as she launched a three-year rolling inflation target of 3-to- 6 percent which analysts said Friday that it is a tall order for the bank.

The move by the central bank is a shift from the usual short term targets to a medium to long term target in line with the international practice. However, the central bank, which is currently struggling to contain inflation rate to last year’s targets of 4-to-7 percent with inflation running as high as 8.4 percent as for last month, is faced with a raft of challenges to achieve its new target.

“It is a good move to hear that the central bank is aiming to bring the inflation rate to much lower rates of 3-to-6 percent. But there are lots of challenges which make it very difficult to achieve those targets,” an analyst at Capital Securities, Leutwetse Tumelo said on Friday.

He said with fuel prices running as high as US $ 100 per barrel and salary increases as high as 15 percent, this will present some challenges to the bank.

“There is no way you can avoid a hike in administrative prices if fuel is so high. And the 15 percent salary increase announced will mean that people are [continue reading]

BizCapital finds financial solutions for SMEs

10 March, 2008 in Botswana, Business

source: Sunday Standard
by Sunday Standard Reporter
10.03.2008 9:51:19 A

BizCapital, the local financial institution, is shoring up its image in the local market as it is embarking on a brand-positioning strategy that includes a fresh service level approach dubbed bridge financing as well as a new logo and new corporate colours.

The local company which specializes in working with capital finance for SMEs by offering financial services products which are tailor-made to meet unique needs of customers in different SME sectors.

“Most of small and medium scale enterprises’ growth rate is usually stunted by cash flow problems as well as lack of supplier confidence.

“At BizCapital, working capital finance is made available to deserving enterprises through invoice discounting on tailor made supplementary solutions such as purchase orders finance and inventory finance,” the company said Friday.

BizCapital Managing Director, Reuben Morapedi, said their financing is an [continue reading]

Lobtrans case deferred

10 March, 2008 in Botswana, Business

source: Sunday Standard
by GOWENIUS TOKA
10.03.2008 10:20:13 A

The case, in which two local banks, Barclays Bank and Standard Chartered, are demanding confirmation of provisional liquidation of Lobtrans PTY LTD and Lobatse Cash Store 1961 LTD for their indebtedness to them, has been postponed to April 3, 2008. The matter was initially set for February 22.
This follows an urgent application by Abdool Saned Asmal through his attorneys, Kamushinda Kaluzi Attorneys, on the one hand, objecting to the impending confirmation of provisional liquidation of his company Lobtrans, and another application by Rahim Khan, on behalf of former Lobtrans and Lobatse Cash Store workers, who sought the authority of the Court to appoint a certain Mr. Zinan from South Africa as their co-liquidator in the matter.

Reuben Kamushinda of Kamushinda Attorneys, said, “There is a general opinion that there are other options to explore, than liquidation, and thus our client’s instruction that we file opposing papers to oppose confirmation of provisional liquidation and therefore needed time to file opposing papers.”

Kamushinda said that they received instruction from Asmal in the [continue reading]

Business should position itself for Chinese money

10 March, 2008 in Botswana, Business

source: Sunday Standard
by Sunday Standard Reporter
10.03.2008 9:45:26 A

Martin Davies, a renowned expert on Africa-China relations, warned investors in Botswana to prepare Chinese sovereign wealth funds (SWF) which are chasing some investment opportunities across the African continent.

Speaking at a Stanbic Bank breakfast last week, Davies said China is using its sovereign wealth funds to assert its strategic interests.

“The Chinese see the current system as unfair and they are cutting the expensive middle man and are coming straight into Africa. In the next 15 to 20 years, we are going to see commodity market as we know it disrupted,” he said, referring to the commodities market which is set in European cities and United States of America.

In the recent past, China has poured money in a number of investment opportunities in Africa, including mining and banking sectors, in a bid to strategically position itself within the [continue reading]

Public Private Partnership to gain from African Venture Capital Association

10 March, 2008 in Botswana, Business

source: Mmegi

WANETSHA MOSINYI
STAFF WRITER

The Public Private Partnership (PPP) initiative could benefit significantly from the upcoming 7th African Venture Capital Association (AVCA) conference that will be hosted by Botswana in just under two weeks.

Speaking at a press conference at the IFSC yesterday, AVCA Managing Director Mawuli Ababio said members of the association, who include international investors and fund managers, are beginning to focus their investment in infrastructure development. “In the past few years, many equity funds and investment into the African continent have been channeled to infrastructure development,” Ababio said. “This country is going to need partnerships in areas like expansion of airports and roads.” Lesego Selotate, an Investment Associate at VPB, said the time had come for African money to be used to develop Africa. “About 70 percent of our funds are flowing to other directions,” Selotate said. “We want it to come back.” He noted that while Botswana’s fund managers had largely put their funds into offshore assets, the trend was changing, especially with the introduction of PPP. Selotate said PPPs were taking hold, citing Bifm, which has partnered with other consortia for the construction of the new SADC headquarters, as a good example.”If you look at our capital flows, there is a lot of liquidity chasing little assets. But it’s encouraging because the trend is changing. BPOPF (the Botswana Public Officers Pension Fund) has allocated more money to this asset class, and we need to [continue reading]

MRI under a spate of unsolicited bids

10 March, 2008 in Botswana, Business

source: Sunday Standard
by Sunday Standard Reporter
10.03.2008 9:43:06 A

MRI, the medical and emergency services outfit which is struggling to recover from losses, has come under a spate of take-over bids from a group of suitors that include one of the giant medical aid schemes.

By Friday, details of the intended transactions were sketchy but Sunday Standard was able to establish that “the negotiations were at an advanced stage”. It is understood that the board meeting that was held on Friday was appraised of the new developments relating to the possible bid.

Three monied companies, which include a medical aid scheme-backed private equity funds, are eyeing the company which has been limping financially for the past three years.

Earlier last month, MRI issued a cautionary statement alerting its shareholders that the controlling shareholders of the company “have received a number of unsolicited proposals from [continue reading]

Air Botswana soars to prosperity

10 March, 2008 in Air Botswana, Botswana, Business

source: Mmegi

Air Botswana chief executive officer, Lance Brogden is preparing to leave office as soon as a new management company takes over the national carrier. The following are Brogden’s responses to a questionnaire framed by Mmegi’s TUMELO SETSHOGO

Question: When did you started working at the national carrier and what was the duration of you contract?

Answer: My contract was for a fixed term of three years, starting 1 October 2005 to 30 September 2008.

Q: What can you say about your achievements since you made the national carrier to be profitable?

A: The results speak for themselves. My role was just a link in the chain of many dedicated and focused employees at Air Botswana. After financial losses over the past few years, this past year profitability has become a reality, with a net profit of around 10 percent or well over P15 million for the first 10 months of this financial year. One must remember that IATA’s 240 airlines only recorded around one percent profit for [continue reading]

EU to press ahead with Economic Partnership Agreement

10 March, 2008 in Botswana, Business, SADC

source: Mmegi

BRIAN BENZA
STAFF WRITER

The EU will go ahead and sign the Economic Partnership Agreement (EPA) with willing SADC states whether or not South Africa comes on board, says European Commissioner of Trade Peter Mandelson.

He was speaking after a review meeting of the interim EPA signed between the EU and five SADC nations late last year.

Mandelson emphasised the commitment of the EU to signing the EPA for the “massive benefit” to be accrued to both parties. Botswana, Lesotho, Namibia and Swaziland broke ranks with South Africa late last year and signed an interim EPA.

At a SADC ministerial meeting at the GICC two weeks ago, South Africa expressed concerns about the EPA, calling it to be negotiated afresh.

Among South Africa’s concerns were liberalisation of services and the elimination of export taxes, which it said could limit the [continue reading]

Southern Africa: SA Pulls Back On Threat to Customs Body

8 March, 2008 in Business, SADC, South Africa

source: allAfrica
Business Day (Johannesburg)

6 March 2008
Posted to the web 6 March 2008

Mathabo Le Roux
Johannesburg

SOUTH African trade negotiators have, at least for now, backed off from their threat to break up the Southern African Customs Union (Sacu) in a standoff with other member states over a divisive economic partnership agreement (EPA) being negotiated with the European Union (EU).

At a crucial meeting of Southern African Development Community (SADC) trade ministers in Gaborone which ended on Tuesday, SA was less confrontational than a week earlier. Last week, Foreign Minister Nkosazana Dlamini-Zuma, in anticipation of the meeting, accused the EU of “using the EPAs to regain ground they think they have lost in their quest for hegemony in Africa”.

An observer at the meeting said SA’s approach was more emollient and was thought have been on the [continue reading]

Botswana scores high in economic freedom

7 March, 2008 in Botswana, Business

source: Mmegi

WANETSHA MOSINYI
STAFF WRITER

Botswana’s economy is 68.6 percent free, according to the Heritage Foundation, 2008 Index of Economic Freedom assessment.

This makes the Botswana economy the world’s 36th freest. The overall score is essentially unchanged from last year. Botswana is ranked second out of 40 countries in the sub-Saharan region, but its overall score is well above the regional average.

Botswana is described as an economic regional leader and scores above the world average on seven of 10 economic freedoms.

Business freedom in the country is at 68.7 percent. The overall freedom to start, operate, and [continue reading]

Importation permits to encourage producers

5 March, 2008 in Botswana, Business

source: BOPA
05 March, 2008

PARLIAMENT – The decision to stop the issuance of permits for the importation of agricultural products was not meant to stop trade but to encourage local producers to sell their products without competition from South Africa.

The Minister of Agriculture, Mr Johnnie Swartz, told Parliament on Monday that this was so because of a common trading area through the Southern African Customs Union (SACU).

Mr Swarrtz said some local producers exported some of their produce to the South African market while the rest of the produce was offered to local vendors, including those from Tonota and Francistown even during that period.

He said on the issue of price variations between South Africa and Botswana, it should be noted that Botswana did not have a price control policy regulating agricultural products.

He said the Tuli Block farmers were not indirectly denying service to local vendors and that he was not aware that local horticultural producers sold tomatoes, which rot quickly, to local vendors.

Mr Swartz said tomatoes, being a perishable product, had a [continue reading]

Alexander Forbes assesses fund managers

5 March, 2008 in Botswana, Business

source: BOPA
05 March, 2008

PARLIAMENT – Asset or fund managers in Botswana are rated locally by Alexander Forbes every year, according to the Assistant Minister of Finance and Development Planning, Mr Duncan Mlazie. He told Parliament on Monday that asset managers that include Allan Gary, Imara Asset Management, African Alliance, Legae Investors, which are registered under the Companies Act in Botswana, are not rated globally per se.

They are ranked by Alexander Forbes on yearly basis to determine their performance in the investment of pension funds. The ranking report is based on the investment figures submitted by the asset managers.

He said the figures are consolidated and analysed with the asset manager with the largest investment portfolio ranked number one. He explained that the ranking is only used for [continue reading]

Self-correction pulls down DCI

5 March, 2008 in Botswana, Business

source: Mmegi

BRIAN BENZA
STAFF WRITER

The self-correction exercise by financial institutions at the Botswana Stock Exchange (BSE) has pulled down the DCI by 0.44 percent to 8187.38 points last week.

Standard Chartered Bank and Barclays Bank, two of the large cap counters, whose shares dominate the domestic board went down by 1.39 percent and 1.52 percent respectively last week. They further lost ground in the free fall which began at the start of the last quarter last year.Analysts say that at the beginning of the self-correction the sentiment in the market was that Stanchart along with the other banks were actually overvalued.”The fall in the share prices is actually driven more by technicalities rather than fundamentals which lead to a fair value readjustment of the share prices.

Even a rough look at the price to earning ratios will show [continue reading]

Shorter Drinking Hours Could Be Imminent

5 March, 2008 in Botswana, Business

source: Mmegi

LEKOPANYE MOOKETSI
CORRESPONDENT

The acting Minister of Trade and Industry, Lebonaamang Mokalake, last week hinted at the possibility of the new liquour hours coming into force soon. Mokalake told Parliament that after careful consideration of recommendations from the countrywide consultations, cabinet approved the revised liquor regulations.

He said the approval had paved the way for the implementation of the new Trade and the Liquor Act, which will come into force during the first quarter of the 2008/2009 financial year.

In 2006, the government proposed to reduce trading hours of liquor outlets, provoking protest from many in the business and leading to a motion by [continue reading]