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Hon. Keletso Rakhudu Assistant Minister Trade and Industry, Botswana. 1. Botswana at a Glance. Covers a total area of 582,000 square kilometres, about the same size as Kenya and France. Population of about 2 million (2011 census) GDP/capita P59,245 ( US$7,889 ). 2. Investment Climate.
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Hon. Keletso Rakhudu • Assistant Minister • Trade and Industry, Botswana 1
Botswana at a Glance • Covers a total area of 582,000 square kilometres, about the same size as Kenya and France. • Population of about 2 million (2011 census) • GDP/capita P59,245 (US$7,889) 2
Investment Climate • Botswana continues to receive favorable sovereign risk ratings by both Standard & Poor’s and Moody’s investment agencies for the general economy, and Fraser Institute of Canada and Resource Stocks for the mining industry • Credit rating stands at A • Ranked 17/93 in policy potential index and number 1 in current mineral potential according Fraser Institute Survey of 2011/12 • Ranked as most transparent country in Africa. Zero tolerance to corruption. 3
Diamond Mining Overview • Botswana’s modern day diamond mining started in the early 1970’s • Minerals contribute substantially to the country’s economy; • An average of 19.5% to GDP (2012 figures) • About 31% to Government revenue (2012/13) • Diamonds contribute 81% of the minerals contribution to GDP • Diamonds contribute about 98% to minerals revenue due to Government 4
Broader Minerals Policy Objectives • Maximize the economic benefits to the nation while enabling private investor to earn competitive returns • Create a competitive environment to stimulate private sector investment in mineral prospecting and exploitation • Encourage linkages with the rest of the economy to expand value addition activities • Generate employment and training for Botswana’s citizens • Safeguard the environment 5
Diamond Beneficiation Specific Policy objective • Transform Botswana from a leading diamond producer by value to a global diamond centre • Licensing conditions that require new mines to market their diamonds locally • Sales Agreement condition that requires our partners, to conduct diamond sales in Botswana and to allocate a portion of production to the local diamond manufacturing industry • Providing conducive environment to efficient diamond sector operation 6
Where is Botswana - Diamond value chain Exploration Mining Rough trading Sorting Cutting polishing Polished trading Jewellery Manuf. Retail some participation Just started some participation) Strong participation some participation 7
Where is Botswana - Diamond value chain • 25 Companies licensed in diamond cutting and polishing since 2004 • 21 cutting and polishing factories with DTC guaranteed rough diamond supply and 4 with different sources of supply • 3302 people employed in cutting and polishing industry in 2012 • Goods polished locally grown from $28 million in 2005 to just above $600 million in 2011 • One of the companies cutting and polishing diamonds in Botswana opened a jewellery factory in 2011 DTC Botswana 8
Where is Botswana - Diamond value chain • A secure diamond transfer facility constructed at SSKA to improve security of transporting diamonds in and out of the country • Government established a private company, wholly owed by Government , Okavango Diamond Company (ODC)to market 10-15% of Debswana production independently from De Beers • ODC is following an aggressive project implementation plan, the company was launced in September 2013 and has todate made 5 sales (2 in 2014). • ODC’s selling model captures broad range of customers across the globe including the DTC sightholders. 9
Opportunities in coal • Know coal deposits; 212 billion; current mined by Morupule Colliery is 3 million tonnes per annum • Domestic use; generation of electricity for domestic consumption • Recently floated 300MW IPP brownfield and greenfield tenders • Export power; using coal to generate electricity for exports to other SADC countries; • Coal exports;exporting coal into the regional and seaborne market; 10
Opportunities in coal • Ponta Techobanine Project • Development and operation of a heavy haul rail from the eastern part of Botswana traversing Zimbabwe through to deep sea port of Techobanine in Mozambique • The Rail shall cover a distance of approximately 1400km terminating at a coal terminal on the Indian Ocean coast in Mozambique • Trans Kalahari Rail & Port • Development and operation of a heavy haul rail from the eastern part of Botswana traversing the Kalahari and Namib Deserts to the Atlantic ocean seaport of Walvis Bay • The Rail shall cover a distance of approximately 1500km terminating at a 4 x 4 km coal terminal situated about 10 km in-land • The terminal will be linked through a conveyor belt loading berths approximately 1km off-shore. • The two Countries to sign a bilateral agreement before the end of March 2014 to pave way for the implementation of the project 11
Thank you 12