The value of Foreign Direct Investment (FDI) facilitated by the Botswana Export Development and Investment Authority (BEDIA) dropped by approximately 69 percent last year as the global recession restricted capital flows and blunted the country's allure to investors.
Yesterday, the government's key foreign investment agency unveiled lacklustre FDI figures for 2009 indicating a 68.8 percent decline in investment to P319.7 million. This was against a target of P550 million for the year.In comparison, in the 2008/09 financial year, BEDIA facilitated foreign investment in Botswana worth P539.9 million against a target of P500 million. Over the same period, these investments created 2, 044 jobs while for the 2009/10 reporting period the P319.7 capital investment created 225 jobs. During both years, the parastatal had targeted the creation of 2, 500 jobs.
Explaining the slump, BEDIA Chief Executive Officer, Jacob Nkate, said like similar organisations around the world, their ability to lure investors suffered in 2009 as a direct result of the global recession.
"We had problems starting from 2008 that everyone around the world also had," Nkate said. "We were all affected by the global recession and the budget cuts that made us unable to achieve some of our targets.
"However, we have adopted the targeting of sectors, countries and investors based on the opportunities we believe are available. We are going to various parts of the world and talking to those people whom we believe will see opportunities in investing in Botswana."
Investment sectors for 2009 included glass manufacturing, steel pipes, energy, cement, condoms and electrical cabling. Nkate and his tacticians at BEDIA take heart from encouraging fourth quarter 2009 data showing a rise in capital investment inflows and job creation.
FDI inflows attributable to BEDIA activities rose to P82.3
"We feel that we are turning the corner towards better times," said Nkate. "We have seen a lot of activity recently from the inward and outward missions from and to countries such as Germany, Singapore, Australia and Mozambique.
"We recently came back from India, Singapore, Russia and the United Kingdom and we have our hopes up. We are talking to several companies that have asked about various opportunities here."
Meanwhile, BEDIA's export development arm showed resilience throughout 2009, ending the year above target. The organisation facilitated exports worth P214.6 million, exceeding the target of P144 million. The 2009 figure also exceeds the 2008/09 export revenues of P187.6 million.
While BEDIA did not elaborate on the composition of the export market for 2008/09, major consumers included Angola, Mozambique, the Democratic Republic of the Congo and Zambia.
"Exports included PVC pipes, aluminium pots, pasta, biscuits, salt, automotive batteries, furniture and soda ash," Nkate said. "Most of the exports were to the Southern African Region." On the 2009 Global Expo, Nkate revealed that the annual showcase generated P48.6 million in orders against a target of P60 million. The event attracted 160 exhibitors and 4, 709 visitors. This is against the 2008 event that generated P50 million in orders, 182 exhibitors and 4, 000 visitors.