Australia Awards Alumni contributing to the long-term sustainability of Botswana’s successful mineral economy

Botswana is one of Africa’s largest mineral economies; mining is recognised as the country’s key economic driver as minerals account for over 30% of the country’s Gross Domestic Product according to the African Development Bank. As the leading diamond producer in Africa and with an emerging coal industry, the extractives sector remains a key priority area for its development partnership with Australia which has a world-renowned extractives sector. As such, a keen focus of the Australia Awards in Botswana has been on skills development and training on effective mining practices for the sustainable use of mining resources and revenues.

Botsile Modisana and Moses Tshetlhane, are two Australia Award Alumni who have returned home to Botswana to effectively contribute to the country’s mineral economy. They both completed Masters degrees in Mineral and Energy Economics at Curtin University in 2013 and are now employed as Principal Minerals Officers in Botswana’s Ministry of Minerals, Energy and Water Resources; both tasked with ensuring that the long term benefits of the country’s mineral economy are passed on to citizens in their respective roles. Botsile forms part of a team of professionals identified to spearhead a ground breaking initiative towards the formation of a mining parastatal, whilst Moses is involved with minerals policy.

On his return from Australia, Botsile joined a team tasked with the establishment of The Mining Investment Company, an investment vehicle the Botswana government will use to manage its shareholdings in a range of mineral enterprises operating in Botswana such as Debswana, BCL Mine and Tati Nickel among others. In the future, the company may have the mandate to invest in assets outside the country as well. His main role was setting up the financial systems and processes needed for the company to commence operations.

With the skills and knowledge gained from his Australia Awards scholarship, Botsile was able to successfully accomplish his tasks, specifically transferring the government’s shareholding in the mining sector to the newly established company. “For the transfer of such assets to happen there is a need for valuation; the financial modelling that I learned during my masters studies in Australia helped me to do that well,” explains Botsile. The formation of the Mining Investment Company has also provided employment opportunities to locals and plans are in place to increase the staff complement to more than fifty employees – part of the government of Botswana’s value add strategy (promoting local businesses and job creation) in the minerals sector. Botsile anticipates that the company will have wider benefits to the country as a whole as all dividends that the company receives will go to a government consolidated fund which is used for public developments such as schools, clinics and roads. “In the long term all citizens of Botswana will benefit as their investment in mining will be well managed,” Botsile adds.

Moses Tshetlhane’s contributions are principally in policy development. While Botswana has successfully implemented its mining policies, Moses’ role focusses on maintaining and improving these policies by making sure Botswana is keeping up with global trends and remains attractive to investors in the extractives sector. “Investors require certainty in a country’s mining policy with regard to its legal and fiscal regimes. The government also outlines its goals that it wishes to achieve through implementation of the policy. Therefore, the aim is to remain competitive globally, through a transparent and fair policy document.”

According to Moses, his Australian experience widened his scope on methods of financing in the mining industry, mining processes and the conditions under which mines operate “When drafting the mineral policy, I take into account the factors that affect the economic returns of mining companies. There are a lot of aspects that I learnt about the Australian mining policy, which I normally benchmark against our policy.”

Moses adds that by making the mining policies more comprehensive, the country and its citizens will benefit considerably from mining operations. Botswana’s mining practices and policy have served the country well, moving it from being one of the poorest countries in the world at independence to a middle income country currently. As the country continues to rely on minerals for steady economic growth, new initiatives and revised policies aimed at maximising mining revenue for continued broad based economic development could ensure a sustainable extractives sector for current and future generations.