Famed Cullinan Mine Banks On Big Diamonds To Drive Down Debt - Forbes Africa

Maipato Kesebang normally grows maize, jugo beans and sweet reed on her 20-hectare plot of land northwest of Gaborone, Botswana’s capital. But last year, worsening drought and heatwaves destroyed much of her harvest.

“The little that grew feebly we just ate. Nothing was left for storage or to sell,” she said.

Usually when her crops fail she turns to collecting wild spinach to sell, to support her two sons. But even that is now disappearing as climate change brings harsher weather and more people turn to harvesting the vegetable to survive, she said.

So last year, for the first time, she signed up to Ipelegeng, a long-standing government safety net program that provides temporary jobs for those struggling to make ends meet.

Now she works one month out of four cutting back overgrown grass and trees, desilting dams and drains, collecting litter or cleaning streets.

She’d prefer to work every month – but demand is so high for the jobs that there aren’t enough slots, she said.

“We only work for a month, then we go home and wait for three months before we apply again. That’s because there are too many people now needing the relief,” said Kesebang, as she pulled weeds on her parched plot of land.

As harsher droughts and hotter weather linked to climate change ruin crops more frequently in Botswana, the country is facing a new challenge: growing demand for social assistance programs.

About 68,000 people worked for Ipelegeng as of March 2018, according to figures from Statistics Botswana, up from about 64,000 in March 2016. Of those on the rolls, about 47,000 were women, according to the agency.

To accommodate rising demand, Botswana’s government last August increased the number of Ipelegeng slots by 5,000, after declaring 2018-2019 an expected drought year.

That will cost the country an extra $2.7 million – money that it does not readily have as its national budget does not specifically set money aside for drought relief, said Billyboy Siabatho, deputy director of the rural development council at the Ministry of Local Government and Rural Development.

“Often, when drought comes, we end up borrowing from funds that would have been set aside for infrastructure development projects,” he said.

Ipelegeng’s main objective is to provide short term employment and relief, while helping carry out development efforts the country sees as important, he said.

“During drought periods, there are fewer farming activities. Therefore most people relocate from farms to villages, looking for alternative sources of income,” Siabatho said.

“Due to limited job opportunities in rural areas, most people rely on Ipelegeng as an alternative source of employment,” he noted.

But as droughts continue to worsen in southern Africa, Siabatho wonders whether the government will be able to keep pace with growing demand.

He also worries whether people will begin to see dependence on safety nets as an easier route than farming, as crop failures worsen.

Botswana’s government, aware of the risks from worsening drought, began in December working on a new drought management strategy that aims to improve planning and budgeting for threats and not focus simply on responding to them, Siabatho said.

For Kesebang, such help can’t come soon enough. Her farm, a few kilometers out of the town of Molepolole, sits in Kweneng District, which has the highest poverty levels in the country, of over 50 percent, according to 2018 report by Statistics Botswana.

Most of the 567 pula ($55) she earns each month she works for Ipelegeng goes to keep her youngest son in primary school.

“I buy books and uniform. Often nothing is really left. Life has become difficult,” she said.

The new planting season isn’t looking much more promising either, she said. Most of the maize, beans, sweet reed and watermelon she planted in late December are struggling, she said.

“The beans are already burning. I have no hope of harvesting maize. Maybe the watermelons will survive,” she said, hopefully.

She’s already given up plowing three-quarters of her farm, to avoid greater losses, she said, though she has allowed a friend to try her luck farming a four-hectare section.

For now, Kesebeng heads to town each day to join hundreds of other temporary workers trimming tree branches that obstruct traffic.

Harsher weather isn’t hitting only the poorest farmers, either. Oduetse Koboto, who heads the environment and climate change unit at the United Nations Development Programme, said he saw little harvest from his own farm last year, in part because of floods.

“I planted tomatoes on 1.5 hectares. I expected to make 200,000 pula ($19,000). I lost. I had also planted a hectare of green peppers, expecting 600,000 pula ($58,000) from it. I lost all that too,” he said.

His 600 mango trees produced not a single useable fruit, he added, and “this is regardless of the fact that I use drip irrigation, solar pumping, and spent on farm maintenance all year round”.

Botswana for over a decade has invested in helping farmers boost grain production and improve food security, including through measures such as better access to credit, technology, seeds and water.

But with droughts worsening, improving harvests remains a challenge – and the country continues to import over 80 percent of its food from South Africa.

“Low production in the agricultural sector due to drought has led to high import bills in cereals, dairy, poultry products and feeds, to name but a few,” Siabatho said.

Costs for programs like Ipelegeng also are rising, he said, noting that the program now costs over $28 million a year to run.

For Kesebang, stress levels are also rising. After watching her new crops wilt, she was nearly hospitalized as a result of anxiety and high blood pressure, she said, and had to remain in Molepolole for two weeks.

“A week into February it rained at least twice. The few plants that survived are recovering. I have hope,” she said. -Reuters

Coca Cola Beverages South Africa (CCBSA) launches an R20 million fund for small supplier development and procurement, annually, for the next five years.

This was announced by the Financial Director, Walter Leonhardt at Gallagher Convention Centre at the third annual Supplier Development Conference.

CCBS is the South African-based subsidiary of Coca-Cola Beverages Africa (CCBA).

Leonhardt said the purpose of this fund is to assist young upcoming black entrepreneurs in the Coca-Cola value chain.

“We are, today, launching the CCBSA supplier fund of access to funding. To address the issue of access to funding which most SMEs experience,” said Leonhardt.

“It is to help them buy equipment, fund working capital and to help them overcome something we have identified as a challenge for upcoming businesses, which is access to capital on quit lenient terms,” said Leonhardt.

Budding entrepreneurs can visit their website to find out how they can access the funds.

Managing director of CCBSA Velaphi Ratshefola said they spent R2.35 billion last year, supporting 567 black-owned suppliers, of whom, 265 were black female owned suppliers.  

“So for me, it is clear that this is working. We have helped create a very inclusive economy. We need to play our part and we need to ensure that only through an inclusive growing economy we can create a stable environment where businesses can flourish.

“If we do not have a stable environment, a stable economy, we will have a lot of disturbances which are never good for business,” said Ratshefola.                      

“So for all of us, we should not do it just for social reasons, we must do it for the success of businesses and imperative,” said Ratshefola. 

Zimbabwe’s Reserve Bank has borrowed $985 million from African banks to purchase fuel and other critical imports with current reserves covering imports for just four weeks, underscoring the severity of dollar shortages, governor John Mangudya said.

The southern African nation last month ditched a discredited 1:1 dollar peg for its surrogate bond notes and electronic dollars, merging them into a lower-value transitional currency called the RTGS dollar.

Mangudya said the central bank borrowed $641 million from the African Export and Import Bank, $152 million from Eastern and Southern African Trade and Development Bank, and $25 million from Mozambique’s central bank, among others.

The loans, which would be repaid from future gold earnings, have a tenure of between three and five years and attract an interest of up to 6 percent above the Libor rate, Mangudya said.

Gold is Zimbabwe’s single biggest mineral export earner, accounting for a third of its $4.2 billion earnings last year after a record output, central bank data shows.

“These loans are well structured facilities contracted last year. They will be paid from future (gold) export receivables,” Mangudya told a parliamentary committee.

The central bank takes 45 percent of dollar sales from gold producers and half from other miners to fund imports like fuel and power and repay foreign loans.

But the miners only have 30 days to keep their dollar balances in local foreign currency accounts, after which they must sell them. The companies have asked the central bank to extend the period they may keep their dollars to 90 days, according to mining executives.

Unable to get funding from foreign lenders like the International Monetary Fund and World Bank due to arrears of more than $2.4 billion, Zimbabwe has looked to financiers from the continent and local banks to shore up its budget.

The central bank chief said Zimbabwe had just $500 million in reserves, enough to purchase four weeks’ worth of imports.

Mangudya said government borrowing from the central bank reached $2.99 billion in December, about three times its permissible overdraft limit.

President Emmerson Mnangagwa’s government has promised to curb borrowing in 2019 under reforms to revive the southern African economy, after the budget deficit soared last year following a spike in spending ahead of elections.

Finance Minister Mthuli Ncube said last week that the local RTGS dollar, Zimbabwe’s new de facto currency, will be backed up with fiscal discipline and the government would allow it to fluctuate but would manage excessive volatility.

On the interbank forex market on Monday, one U.S. dollar fetched 2.5 RTGS dollars, the same rate as on Feb. 22 when the central bank sold some dollars to banks. That compares to a rate of 3.5 RTGS dollars per U.S. dollar on the black market. -Reuters

Volvo Cars said on Monday it will introduce a 180 km per hour (112 mph) speed limiter on all new vehicles as the Swedish automaker seeks to burnish its safety credentials and meet a pledge to eliminate passenger fatalities by 2020.

While Volvo, whose XC90 flagship SUV currently has a top speed of 212 km/h, has made progress on its so-called “Vision 2020” target of zero deaths or serious injuries, Chief Executive Hakan Samuelsson said it is unlikely to meet the goal without additional measures to address driver behavior.

“We’ve realized that to close the gap we have to focus more on the human factors,” Samuelsson said. Volvo did not elaborate on the data but said its passenger fatalities were already well below the industry average before the goal was announced in 2007.

In addition to the speed cap, Volvo plans to deploy technology using cameras that monitor the driver’s state and attentiveness to prevent people driving while distracted or intoxicated, two other big factors in accidents, Samuelsson said.

The company is also looking at lower geo-fenced speed limits to slow cars around sensitive pedestrian areas such as schools, while seeking to “start a conversation” among automakers and regulators about how technology can be used to improve safety.

Volvo, which is owned by China’s Geely, announced the new speed limitation policy on the eve of the Geneva auto show, where its new Polestar performance electric-car brand is showcasing its second model, the Polestar 2.

While Volvo buyers often choose the brand for its safety, Samuelsson conceded that the speed cap could be a turn-off for a few in markets such as Germany, where drivers routinely travel at 200 km/h or more on unrestricted autobahns.

“We cannot please everybody, but we think we will attract new customers,” the CEO said, recalling that the roll-out of three-point seat belts pioneered by Volvo in 1959 had initially been criticized by some as intrusive.

“I think Volvo customers in Germany will appreciate that we’re doing something about safety,” he said. -Reuters

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