- Puts P15.9 billion in hands of citizen contractors, local suppliers
STAFF WRITERS
Ambitious and deliberately driven to be impactful in changing lives of citizens, the five-year Debswana Citizen Economic Empowerment Programme (CEEP) has entered the home stretch.
Debswana Diamond Company points to the ground covered with pride, declaring that they have achieved 80 per cent of the targeted citizen companies spend projection. At conception the programme sought to directly spend P20 billion on citizens and their companies while creating 20 000 jobs by the end of the year 2024. As of August 2023, the programme standing at 80 per cent of implementation had already disbursed P15.9 billion to citizen companies. This represents a direct reverse of previous years where there was no bias in favour of locals, with projects often benefiting foreign entities.
The CEEP programme is primarily aimed at increasing citizen inclusion within the company’s supply chain “by creating an enabling business environment, supporting citizen entities and preferential procurement with the objective of creating employment and diversifying the economy”.
To operationalise and ensure citizen companies’ participation, Debswana has entered partnerships with various financial institutions to avail necessary credit to local bidders to deliver on their supplies. These include leading bankers such as First National Bank Botswana, Absa, Standard Chartered Bank Botswana, Stanbic Bank, Access Bank, Bank Gaborone, National Development Bank, and Citizen Entrepreneurial Development Agency (CEDA).
Creation of jobs
While there is clear impact on local companies, Debswana remains anxious of measuring and accelerating creation of jobs to meet the set 20 000 target.
In an internal review commentary, the company declared: “The focus for the remainder of the Programme is on job impact and this has been outlined in the ‘Accelerated Economic Empowerment Framework’ which is aimed at developing and supporting value chain jobs primarily under local manufacturing and local repairs and maintenance. This includes governance process to support the acceleration of economic impact and monitoring and tracking methodology. To this end, the Programme is at an advanced stage of formalising a partnership with Statistics Botswana to provide guidance and assurance on accounting for Debswana jobs impact. A survey conducted in 2022 Q3 confirmed a jobs impact baseline of 11,233 (excluding Debswana and its subsidiaries employee numbers)”.
Just last week Debswana penned a new partnership with Botswana University of Agricultural and Natural Resources (BUAN) on technical partnership support for food security projects and initiatives by the miner, which is in line with accelerating job creation.
Chief Financial Officer (CFO) at Debswana, Ian Modubule said beyond making distributions to the government, Debswana aim to ensure that they change the lives of those they interact with, positively impacting on the livelihoods of communities they operate in.
Among the leading promoters of this project has been the Minister of Minerals and Energy, Lefoko Moagi, who raves about the impact the programme is having in transforming the lives of citizen players while generating jobs and wealth.
To him, a major breakthrough of the programme has been in the localisation of Debswana’s long term contracts, unbundling of Cut 9 contract packages to benefit the broader citizen community, development of citizen participation in the supply and transportation of fuel and development and support of locally manufactured products in the mining sector.
“This initiative has improved citizen participation in some technical services like conveyor maintenance services, crushing services, drilling services and tyre maintenance services,” Lefoko said when answering a question in Parliament about the programme.
An analysis of the distribution of the funds to citizen businesses showed that Energy (fuel and electricity) accounted for 62% of citizen spend while outside of energy, drilling accounted for 25% of citizen spend.
Don’t front – Debswana MD warns
Debswana Managing Director, Andrew Motsomi has continually warned locals against the temptation of fronting for foreign companies because that will defeat the objectives of the CEEP programme.
Addressing the National Business Conference last year, Motsomi hailed the programme as Botswana’s ticket to facilitating the creation of a middle class which will lift the country to a high-income status. “An important caveat though, is that in order for the programme to yield the desired results, the beneficiaries of the programme should refrain from fronting,” he cautioned.
At the time Motsomi was happy that they had just awarded a P300m industrial lubricants contract to a citizens company – which was one among the over 100 citizen companies under their Supplier Development Programme. Nametso Gaepotlake – Supplier Development Manager at Debswana – sees the CEEP as a catalyst to diversifying the manufacturing landscape by ensuring that production inputs are localised and the benefits trickle down to spur inclusive economic growth.
Debswana at WIM2023
Meanwhile Debswana was a Gold Partner of the Women in Mining Conference held on the 1st to the 2nd of November 2023 in Gaborone, Phakalane. The event was held under the theme; “A new driving force in mining: Unveiling the Next Generation of Women Leadership In Mining in Botswana and Beyond”.
Officially opening the conference, the Minister of Minerals and Energy, Lefoko Moagi implored participants to appreciate the role that women play in the workplace, especially in mining where the introduction of women over the years in various roles has seen increase in production and productivity because of the carefulness and thoughtfulness of women. He hailed the Debswana Citizen Economic Empowerment Programme (CEEP) as a tool that can be leveraged to spur more women participation in the mining sector and the economy at large.
Researcher’s view
An independent ESG Analyst and Researcher, Desmond B. Munyadzwe has given thumbs up to Debswana’s CEEP programme. He said localising Debswana’s supply chain goes a long way in creating value for the local companies, as through the CEEP, they can build capacity to develop into sustainable companies that can create employment for the local communities.
“Global sustainability and human rights organisations advocate for localized beneficiation of natural resources including minerals. As these companies grow, they set up offices locally, expanding the value chain where other companies that offer services like, secretarial, cleaning, management, consulting, and other support for companies can thrive too. This creates a cyclic effect back to the main concern of labour standards. Most of the people who will possibly lose jobs due to the transition are in administration and management because once Debswana absorbs other employees, there will be reduced needs for contract management and administration.
Though it will take a while, those employees will be absorbed into the local companies that are being contracted by Debswana. The only difference is that they will now be employed by local companies. In addition, more of them can be absorbed because all offices including head offices are local, compared to international companies with head offices overseas,” he argued.