F&G Botswana targets African market
Chakalisa Dube | Friday November 13, 2015 15:59
F&G manufactures cigarette flavours and fragrances using ethanol and tobacco. The company is a 100 percent subsidiary of HuaBao International Holdings, which is based in China.
“There is greater demand for our products in Mozambique, Zimbabwe and South Africa and other African countries,” Steven Zhu, the deputy general manager for F&G said. “Our intention is to explore these markets with the help of the Botswana Investment and Trade Centre (BITC).”
However, Zhu said his company’s expansion plans were at their early stages.
Speaking early this week during a tour of companies that were assisted to set up in Botswana by the BITC, Zhu said his company’s expansion plans were at their infancy. The tour was organised by the BITC.
The company generates an annual turnover of over P36 million and has 30 employees, with 80 percent of them being Batswana. The company sells 100 percent of its products to the Asian market.
Zhu said in an interview that the company would double its workforce and income once it has expanded. He was however, non-committal on the amount the company would spend on the envisaged expansion.
He also said the company chose to set up in Francistown ahead of other areas because the city was closer to Zimbabwe where they source their raw materials. Other raw materials used by the company come from Zimbabwe, South Africa, Brazil and United States of America.
He said the company was also boosted by the fact that Botswana was stable politically and economically. He hailed Botswana’s tax regime as another factor that attracted him to set up in the country.
“When we set up infrastructure in the city, roads were not up to scratch which made it difficult for us to transport our products to Gaborone before they go abroad,” he said. “However, now things are improving with the construction of the new network of roads. Even support services such as the internet are a bit faster than when we first set up which makes Botswana a business destination of choice.”
He also said the company chose to come to Botswana because of the country’s competitive rates.
Despite Botswana having a stable economic environment, Zhu said F&G faced challenges that affected its operations.
He added: “We often face challenges of processing permits for our expatriate workers. At times they take a long time to be processed. In some instances they are rejected.
This affects our operations because some of the technologies come from abroad and we need expertise which is not available in the country.”
F&G, which set foot in Botswana in 2007, invested P56 million on raw materials and machinery to start operations.