The CEO of Botswana Investment and Trade Centre (BITC) Kelotsisitse Olebile has conceded that COVID-19 has badly affected the agency’s prospects of attracting Foreign Direct Investments (FDIs) in 2020.
Olebile said the pandemic that has ravaged economies of most countries across the globe and this will affect Botswana in terms of FDIs attraction which will decline by 40%.
Business Botswana president Gobusamang Keebine said turning focus into domestic investment facilitation is a welcome development although saying it has not been a priority for many years.
Keebine said BITC in its endeavour of revitalising domestic investment economy must create a conducive environment for existing businesses so that foreign investment can buy into them.
“Domestic investment should have been long prioritised not just in time of crunch brought by COVID-19. To attract investments locally, it is better when we have existing businesses so that foreign investors attracted find it easy to buy instead of starting business from scratch,” he said.
Economist Sennye Obuseng said it was imminent that FDIs will decline due to the danger posed by COVID-19 to the world stronghold economies that trades with Botswana.
He said domestic investment has always been necessary, indicating that if the country had a robust domestic industry the Citizen Economic Empowerment couldn’t be a problem.
“It is a good move by BITC to relook into the domestic investment perspective but it will be very helpful if the agency could formulate strategy on how they will do it better,” he added.
FDIs in comma
Olebile revealed that FDI reduction as forecasted by the United Nations Conference for Trade and Development (UNCTAD) anticipate minimal FDI, thus turning into domestic activity.
According to UNCTAD, FDI inflows in Botswana rose from USD 177 million in 2017 to USD 229 million in 2018 with the rise mostly attributed to immense increase on automotive sector.
The total stock of FDI in Botswana reached the USD4.82 billion in 2018, estimated at 25.4% of the country’s GDP with mining leading FDIs UNCTAD, World Investment Report of 2019 stated.
“We will conduct a survey on the local businesses during and post lockdown time to assess on how domestic investment attraction can be facilitated. The domestic investments are also very crucial and with COVID-19 disruption BITC has found potential on emerging sectors,” he added.
BITC, he said, during the transition of empowering domestic investment it will be helping local businesses across various sectors to find opportunities that they can use for expansion.
He also indicated that some local businesses were not able to attract potential investors because the majority of them are not aligned to the right investments that suit them.
Consequently, he said, surveys on local business chains could be crucial in repositioning the businesses with their relevant investment opportunities that could help expand footprints. “The survey we have done during the lockdown period on local enterprises to find out how the period affected them shows that there is a need for stimulus package from the government to help them survive and meet economic hurdles beyond COVID-19 as 99% suggests,” Olebile said.
He elaborated that BITC will continue to lure and follow up on the foreign investment prospects by linking digitally to Botswana diplomats abroad in a bid to woo investors post Coronavirus.
Positives that emerged amidst COVID-19 include online trading paving the way for e-commerce.