Botswana has unveiled a US$115 million facility to assist local businesses with loans to weather the economic headwinds triggered by the COVID-19 pandemic, according to local media on Monday.
Investment, Trade and Industry Minister, Peggy Serame told the state-run Botswana Daily News that the government has allocated P1.3 billion for the Industry Support Facility that is designed to “support distressed businesses in different sectors.”
“Our ministry has been allocated P700 million from the facility, which will be administered by the Botswana Development Corporation (BDC), Citizen Entrepreneurial Development Agency (CEDA) and Local Enterprise Authority (LEA) in different categories,” Serame said.
She said the facility has been introduced to resuscitate businesses that are struggling due to the economic contraction triggered by the COVID-19 pandemic. About P100 million would be disbursed through LEA to support informal traders. This includes a once-off P1,000 grant to be given to each deserving trader, constituting a third of the total amount, she said. The remaining two-thirds of the informal sector support would be in the form of infrastructure such as the construction of market stalls, food courts and incubators to assist businesses to improve operations and in acquiring market access.
Some P300 million of the funds would be administered by CEDA to support small, medium and micro enterprises (SMMEs) in sectors such as the creative industry, agriculture, technology and innovation, manufacturing, tourism, construction, mining and energy.
The assistance is targeting registered SMMEs with an annual turnover of over P10 million, and the loans would be equivalent to 10% of their annual turnover.
The BDC is expected to administer P300 million set aside to assist large-scale corporations with working capital and development funding. These large industries with a turnover of P50 million or above would qualify for a maximum P25 million loan, provided they are companies registered and operating in Botswana, are tax compliant and utilise the services of registered accountants.