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Banking Expo tackles financial inclusion

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A Banking and Wealth Expo scheduled for November 15-18th 2017 at Ditshupo Hall in Gaborone will tackle the nagging question, what is financial inclusion? According to Oabile Mabusa, Chief Executive Officer of Bankers Association Botswana (BAB), who are joint coordinators of the expo with Botswana Institute of Bankers (BIB), financial inclusion does not mean access to loans and credit in the banking sector as most people think.

“Financial inclusion is the ability of citizens in the society to have effective financial services that address their needs to credit, advisory services on investments, translation of money into wealth, ability to conduct payment services and other forms of money services. These instruments should be availed in a cost effective manner,” says Mabusa.

Addressing the media, Mabusa said that the expo is part of a private sector response to the challenge to broaden financial access and inclusion, both of which play a pivotal role in promoting economic development. The expo will be under the theme, ‘bridging the inclusion gap through financial literacy.’ Explaining the objectives of the Expo, Lydia Andries, CEO of Bankers Institute Botswana says they want to bring regulators and authorities together to have a clear dialogue within the financial services sector. “We also want to create a conducive environment for the financial sector to flourish.

We had always wanted to diversify the economy as a country, and as such we believe the sector can play a meaningful role in driving the economy going forward. It has the potential to position Botswana as one of the best destinations globally,” says Andries. The Expo is expected to attract influential players in the market and will also feature various primary and secondary school students who will be introduced to careers in a particular sector. This is so to catch them young.

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Sefalana intensifies bottled water business

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Sefalana's Finance Director, Mohamed Osman

Foods Botswana (FB), the manufacturing arm of Sefalana Group has announced intentions to aggressively grow its bottle water business under the AStar brand.

The low level of profitable recorded by the Group’s manufacturing subsidiary for the six months ended 31 October 2019 due delays and red-tape on government feeding scheme orders is pushing the directors to think out of the box. The group’s beverage division’s government tender for children’s feeding scheme awarded to the company last year was contested by other parties and postponed, leading to FB not supplying any beverages to government.

“In particular, we look forward to expanding on our manufacturing business with fruit juice and bottled water,” said Financer Director Mohamed Osman.

In addition, the restriction on bottled water that was announced by government last year is inspiring the company’s expansion plans. “To support this, we will need to develop a warehouse to accommodate additional plant and equipment and storage,” said Osman.

On milling, Sefalana’s contracts for Tsabana and Malutu, the government feeding scheme products ended in September 2018 and the Group was awarded a four months’ interim supply, pending the 2018/19 tender consideration.

The delay has pushed Sefalana to focus on the manufacture and supply of branded products to utilise factory capacity.However, the directors remain optimistic that government will consider Sefalana for the tender and has already stockpiled raw materials for the tender.

“We are confident that our track record for delivery of a quality product in accordance with the required quantities and timetable over the years, will place us in a good position for the forthcoming award,” said Osman. Apart from manufacturing, the Group also intends to launch Sefalana Catering, a division that will focus on serving the large hospitality industry with frozen foods in wholesale size units.

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Orapa region mines pick De Beers’ output

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Planned production increase at Debswana’s mines in the Orapa region – Orapa, Letlhakane and Damtshaa has pushed up De Beers’ rough diamonds output for the last quarter of 2018, the group’s latest report has indicated.

De Beers’ latest production report shows that rough diamond production increased 12 percent to 9.1 million carats in the last quarter of 2018. The increase is compared to 8.6 million carats recorded in the third quarter and 8.9 million carats in the second and 8.4 million carats in the first quarter.

Despite the good performances by Orapa mines, De Beers missed its production target of 35 to 36 million carats for 2018, as the total production for the year landed at 35.3 million carats. Other mines that contributed to production include Jwaneng, Namibia’s Namdeb Holdings, South Africa’s De Beers consolidated mines and Canada’s Gahcho Kué.

On the other hand, the full year rough diamond sales volumes were four per cent lower at 33.7 million carats compared with 35.1 million carats in 2017.Meanwhile, the 2019 production guidance for De Beers is 31 to 33 million carats, subject to trading conditions. “The lower production is driven by the process of exiting from the Venetia open pit with the underground becoming the principal source of ore from 2023.

“Associated with this, an increased proportion of production in 2019 is expected to come from De Beers Group’s joint venture partners, a proportion of which only generate a trading margin, which is lower than the mining margin generated from own mined production,” said De Beers’ latest production report.

Meanwhile, local analyst Econsult’s economic review for the fourth quarter 2018 has observed that the global diamond market has been performing reasonably well in overall terms, but with stress in particular segments that may reflect structural change and potential volatility going forward.

Econsult however bemoaned that the price increase for rough diamond has squeezed profit margins for dealers and cutters, as polished prices have not increased commensurately.
“The problem has been particularly acute for small, low value diamonds, perhaps due in part to pressure from increasing supplies of synthetic diamonds,” said Econsult.

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