Botswana Development Corporation (BDC) and the African Development Bank (AfDB) have finally signed a thematic Line of Credit of P900 million for a 10-year tenor.
The AfDB loan, which required a sovereign guarantee from government, was once stalled, awaiting the green light from lawmakers who required more details on the investments that BDC was undertaking.
According to the Corporation’s acting managing director, Moatlhodi Lekaukau, the injection will support the BDC’s long term strategy to scale up its investments in key sectors including manufacturing, transport and service sectors with the objective to support transformation and industrialisation of the economy.
“This is the single largest transaction of its nature to ever take place in Botswana demonstrating confidence in the corporation’s business and strategy. With this partnership, comes a wider socioeconomic benefit including attracting investments into the economy and employment creation,” he said. Late last year the Corporation revealed their plans to spend up to P750 million on various new projects this year, bolstered by resurgent finances and the P900m loan from the AfDB. The BDC’s upcoming local investments include agriculture, agro-processing and transport.
According to Lekaukau the transaction further supports BDC’s focus on safeguarding its balance sheet to ensure financial sustainability whilst fulfilling its mandate as the government’s main investment arm.
He said over its just-ended five-year strategic period, BDC has transformed and driven exceptional results as evidenced by P700 million growth in the net-worth of the business to an impressive P2 billion, cumulative profits of P1 billion and an asset base growth to P4.8 billion amongst others.
The AfDB is a multilateral development finance institution with an overarching objective to spur sustainable economic development and social progress in its regional member countries (RMC) through mobilising and allocating resources for investment and providing policy advice and technical assistance to support development efforts.