Wednesday, May 12, 2021

Govt’s continued ‘investment’ in Phikwe will ultimately bear fruits

This week the Selebi Phikwe based copper-nickel mining company, BCL hosted the media for its annual tour. The purpose of the tour was to update key stakeholders, through the fourth estate, on various projects that the mining company has undertaken as well as structural and operational changes.

When addressing members of the press on the guided tour, BCL Managing Director, Dan Mahupela spoke of the ‘cleaning’ of the company’s balance sheet.

“BCL’s balance sheet is showing a sound financial position, with the company now debt free,” he said. This is indeed good news. The balance sheet cleaning that Mahupela spoke of could not have come at a more opportune time. The fact is that BCL’s defective balance sheet has for a very long time weighed down on the company – closing down its prospects and limiting its options. From the presentations made by Mahupela and other members of the BCL executive management, we can be certain that the threat of closure and collapse that was previously hovering over BCL and by extension the ‘ghost town’ that was Selibe Phikwe has been lifted, and there now exist promising prospects of prosperity for years to come.

For those of us who have been following the operations of the Selebi Phikwe based copper mining company with keen interest, we believe that conclusion of a deal to acquire some of the Norilsk Nickel’s assets in Africa was made possible partly by the balance sheet restructuring that allowed the company to borrow and finance such transactions. For such initiative, and flexibility of thought, we have to applaud the BCL board and by extension the government of Botswana for its foresight in facilitating and supporting the restructuring of the BCL balance sheet and other related transactions.

This is not to say we have entirely forgotten the fact that what transpired in Selebi Phikwe is a result of government’s misplaced insistence on centralizing everything in the capital Gaborone. There is no doubt that the once glorious town of Selebi Phikwe was almost brought to its knees by government’s flawed and destructive policies. But certainly, having realized its flaws, government was prompted to launch the Selebi Phikwe Diversification Unit (SPEDU), which is mandated with breathing life back into the north eastern town, which is also the lifeblood of many outlying villages. We all know that villages such as Mmadinare, Bobonong and Sefhophe are arterially and fatefully attached to Selebi Phikwe, thus the need to ensure the survival of its domestic economy.

We have been made aware of a master plan that the company executives have presented to cabinet. Some of the proposed undertakings are mesmerizing to say the least. The government’s investment in the Steel Project through both BCL Limited and CEDA will certainly boost the confidence of investors who want to either return to Phikwe or set up their businesses there. From where we stand, what is more crucial is the fact that BCL Limited’s success will see Selebi Phikwe as a town gravitating towards a more sustainable future that is predicated on economic certainty, economic confidence and long term stability.

While these are all necessary for the turnaround, they are certainly lacking at the moment. The government should be reminded of the fact that there is a lot of tourism potential in and around Selebi Phikwe that alone could help diversify the town’s economic base and reduce its overbearing reliance on the Mahupela led company. By doing so, the government would be admitting the sad reality that Phikwe as a town is still on its death throes.

It is not yet attracting investors as one would want and still relies heavily on BCL Limited for its existence. The #Bottomline however remains that as a commercial enterprise, BCL Limited has potential to become a totally new animal which could turn into a regional power which it aspires to be. This is only possible if the company’s master plan is efficiently executed, of course without too much political interference.

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