The DPF is a defined contribution pension fund established in 1984 as a trust through a joint initiative between Debswana, Anglo American Corporation Botswana, and De Beers Prospecting Botswana with key investments in property, equity, bonds and alternatives.
In an update to members recently, the DPF officials said the first quarter kicked off with a positive market performance due to several factors, which helped the pension fund’s returns. “Positive performance for the quarter was driven by offshore assets namely, global equities, emerging market bonds, emerging market equities, African equities, and global cash. “Global equities were the main driver of growth in the quarter, particularly in the United States,” officials revealed. According to the officials, the rebound of the United States of America (US) economy helped drive profit in key off shore investments. “US markets were bullish in the quarter, underpinned by strong growth, healthy consumer spending, and high employment levels.
Real Gross Domestic Product increased at an annual rate of 1.6% in the first quarter of 2024,” the officials revealed. Despite a strong performance in international markets, especially in offshore equities, the DPF had some drawbacks in the local property sector in the first quarter alongside further headwinds in the Chinese asset class, which has been a negative performer in the past quarters. “The Botswana property was in negative territory for the quarter declining by 0.21 percent. “China was once again the worst performing asset class for the quarter declining by 3.23 percent,” officials revealed.
The Fund officials revealed that they remain cautiously optimistic heading into the second half of the year, mainly because financial markets face numerous challenges, including resurgent inflation, the risk of a global economic slowdown, volatile energy prices, and geopolitical tensions. “The Fund will continue to implement its prudent investment strategy to navigate the different risks while taking advantage of emerging opportunities,” the officials added.
