In a bid to create a modern and enabling law to make Botswana a long term preferred financial and business centre, Botswana is in the process of reviewing IFSC governing legislation.
The move is in response to feedback from the investment community and it was strongly recommended by the BOCCIM National Business Council last year and an answer to competitors that have one all inclusive legislation.
“Certain sub sectors were not catered for under the current legislation,” Alan Boshwaen, CEO of IFSC revealed.
“There is (for example) no specific law that covers private equity firms; in fact, that is a growing area.”
Some of the sectors that the new legislation will cover include, amongst others, commodity exchanges, private equity, modernising where it is necessary in the banking and insurance.
Boshwaen revealed that IFSC-International Financial Services Centre is currently working with an international legal firm, Clifford Chance of London, in partnership with local firm Armstrong Attorneys.
“The new IFSC legislative framework aims to create a modern and flexible legislative framework that positions Botswana as a medium to long term proffered financial and business services centre in the region,” added Boshwaen.
Already, stakeholder workshops have been held with Bank of Botswana (BoB), Non Bank Financial Institutions Regulatory Authority (NBFIRA) and Botswana Unified Revenue Service (BURS) with the Ministry of Finance coordinating the process.
If everything goes by the plan, the legislation will be made to pass by next year and Boshwaen said it will enable IFSC tap into new opportunities.
Despite the global recession, IFSC is touted as one of the best performing parastatals with the annual report for 2009 showing that the business development and facilitation efforts continued to bear fruit during the year.
The report showed that a total of 8 companies were certified during the year, bringing the total cumulative capital investment by Botswana IFSC companies to P6 billion.
It showed that total employment created by these companies now stands at 585 mainly comprising professional skills intensive jobs.
The total tax contribution by the companies during the year under review stands at P87 million and in the same year IFSC received P7.5 million from government to fund its operations.
Other milestones, IFSC said a new international call centre PTS Solutions was accredited in November 2008 and it provides services to international clients. The Phakalane based call centre when full operational, it will employ 200 Batswana.
Vantage Mezzanine Investment Fund II, a private equity fund that will provide mezzanine financing to a diverse range of industrial and services across Africa was also set up.