CEDA loses P200m to COVID-19

Chief Executive Officer of CEDA, Thabo Thamane has revealed that the state owned financier forecasts to lose approximately P200 million in failed collections due to the COVID-19 pandemic.

Notwithstanding the setback, Thamane told The Patriot on Sunday, in an interview that they remain confident of a rebound, hence the decision to launch facilities that will mitigate the negative impact on the pandemic on their stakeholders and clients. Another motivation for the new facilities was the recognition that Botswana found herself exposed and vulnerable due to oer dependence on neighbouring South Africa for most of goods and services consumed in the local market. Faced with debilitating impact of COVID-19 , which is spreading wildly in townships, South Africa has imposed  restriction on exports to other countries as they battle to contain the spread of the virus.

Thamane said CEDA has launched the Covid-19 Essential Supplies Loan facility, which will be extended to companies that are involved in the production of essentials that are related to COVID-19 or products that have a high propensity and viability to be manufactured during and beyond the pandemic.

“The loan is aimed at ensuring heightened citizen participation and empowerment in the production and supply of items such as sanitizers, gloves, masks and other essentials identified to ensure the country’s sufficiency,” said Thamane, adding that the P30 million loan facility will be interest free up to 24 months and only citizen are eligible for the loan.

As another mitigating factor due to Covid-19 pandemic, Thamane revealed that they have also established a special CEDA Covid-19 Relief Fund.  The special fund according to CEDA CEO will focus on working capital facilitation and providing repayment breaks for CEDA clients in both Mabogo-Dinku and mainline.

Other interventions that have been put in place to mitigate the impact of the economic downturn include rescheduling, restructuring of loans and provision of working capital. Regarding the payment of the loans, Thamane indicated that they have given their clients up to 12 months repayment holiday. “If the business recovers well before the elapse of the 12 months they will have to honor their payments hence we emphasis ‘up to 12 months’” he said.

He said the Fund will be funded with P40 million to support the continued operational activities of the existing CEDA funded SMMEs.