The Botswana Development Corporation (BDC) has parted ways with US investors who pumped P40 million into the Milk Afric project, earning 26% equity share.
Last year, BDC took full control of Milk Afric, paying zero thebe for the transaction but assuming the obligations of the troubled Lobatse dairy project. The corporation has so far spent P48 million ( $ 4, 370, 899) on the project, which covered the costs of roads, boreholes, electricity connections, rotary, fencing and working capital.
This week, BDC Head of Corporate Affairs and Strategy, Boitshwarelo Lebang said the US technical partner had expressed a desire to exit the investment and focus on other business interests.
“We had a technical partner in line with our investment strategy of growing Botswana’s local dairy production to enhance national food security platforms,” she said.
Launched amidst much pomp and fanfare in 2016, Milk Afric was set to revolutionise Botswana’s dairy sector, wean it off its over-reliance on South African products and bring the town of Lobatse to life. Local students were sent to Florida in the US for training to the tune of P300,000 in tuition fees per student. The venture has struggled to take off despite donations of machines and land from stakeholders, BusinessWeek is informed.
Lebang, however, said they expected Milk Afric operations to begin in June 2021. The BDC recently floated an invitation for new bidders for the project. Lebang said the new technical partners had revised the business plan, which would help determine the investment required to bring the project to commercial operation. Milk Afric was earmarked to milk 2,000 herd of cattle at full production capacity. Botswana pinned its hopes on the project transforming the local dairy sector, thereby enhancing the national food security. That would allow the country to cut back on the importation of milk and milk products, reducing Botswana’s heavy reliance on imports – a key lesson from the disruption in supply brought about by the COVID-19 pandemic.
“The project has prospects in the medium to long term to meet local demand with vertical integration on milk products,” Lebang said.
“Milk Afric also seeks to create sustainable economic diversification, create jobs for Batswana and promote real growth of the dairy sector of the economy.”
YourBotswana view…
The Milk Afric Project is one of a clutch of projects that could help Botswana’s diversification drive, but which for whatever reason, keep stopping and starting. I’m watching this project very closely because about seven, I covered an event at which things appeared to be taking shape. Even at the time, my fellow journalists told me the project had been in the pipeline for years. I’d just returned to Botswana from living abroad for 13 years.
But here we are, still singing the same tune with nothing to show for it! Botswana is very good at talking and coming up with fantastic ideas but falls down when it comes to implementation. All pie in the sky! We undoubtedly waste time calling various pointless meetings and talking, talking and talking some more. We have a penchant for talking, and can talk until the cows come home. Hideous amounts of the taxpayers’ money can easily be ploughed into a project only for it to collapse and be scrapped in a shockingly lackadaisical fashion. Nobody is held accountable, life carries on as usual, and there’s never any mention of heads rolling. Or someone being shown the door for simply not having the capacity to deliver what’s expected of them. It’s truly mind-boggling!
No doubt, the American investors cut their losses and abandoned the project due to the useless meetings, people jostling for position to have their divergent and often archaic ideas heard and worse still, our age-long habit of dragging everything out. If there’s an easier, quicker way of doing something, many Batswana would rather go down the convoluted time-wasting route! It’s just what we do!
My best bet is by the time Milc Afric starts operating (if it ever does!), it’ll have taken decades to get to that point. Think the many failed attempts to sell off or privatise (the goalposts have moved so many times I’ve lost track) another ailing government entity, Air Botswana. If indeed like Lebang says Milk Afric starts operating from July, I’ll happily eat humble pie. Or indeed, my hat.
Source: http://www.mmegi.bw/index.php?aid=88540&dir=2021/january/29
