Saturday, December 9, 2023

Global recession hits Botswana

Francistown:- In the little town of Francistown, just 400 kilometers north of the capital Gaborone, sits the oldest town in the country.

In the olden days, this place was nourished with gold and nickel metals which are only associated with the queens and the kings of this world.

Over the last four months, there has been a sale by DTC Botswana indicating the impact of the global recession.

The dimension has taken a very different picture, with companies estimating that it would slash up to 20 percent of the media advertising out of the P 100 million that is usually used per year.

Government was estimated to have harvested P 20 billionÔÇögiven the fact the people were honest payersÔÇö- through taxes alone but the figure is thought to be around P 13 billion.

“We all have to be honest if we do really want this country to push forward. I have invested a lot of money into the property market, “ he said .

The serine environment of O’ Hagans restaurant is definitely clouded with some inconstancies, given the fact that in the coming month Botswana Metals Refinery Company (BMR) will be retrenching close to 200 people. The move will have far reaching implications that include the banking sector and the social aspects. The problem is also complicated by the fact that the country does not have rehabilitation centers that deal with people who have lost their income and livelihood.

The BMR scenario is complicated by the international base metal markets which have been subdued for some time since mid third quarter of the year. The move is partly fueled by the American, Asian and European financial crisis that has also weighted heavily on the diamond sector.

Rough Diamond prices slumped heavily following the World Diamond Council (WDC) President, Avi Paz’s appeal to reduce supply to polishers in the light of the mounting debt level of the sector.

The industry is indebted to the tune of US 18 billion which is enough for one year’s supply . The appeal prompted DTC Botswana to suspend its sight holding for the last four months. The plan was supposed to have netted the country US $ 370 million ( about P 3 billion).

All the mines in the northern area have suspended hiring and are working on plans to complete their contracts while others are thinking on putting employees on unpaid leaveÔÇöthat would directly affect leading mortgage banks as Botswana Building Society (BBS) and First National Bank of Botswana into a corner.


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