The effects of the global commodities price slump have not spared any mining company, but the severity of the impact varies country to country. In some countries, more especially in Africa, coupled with prevailing local conditions – power supply constraints, volatile labour movements and red tape – have had an adverse impact on mining operations, leading to scaling down of operations. African Mining Brief chats with the Chief Executive Office of the Botswana Chamber of Mines, Charles Siwawa, to find out how the sector in the country is coping in general.
AMB: With economic diversification not taking place at a pace which government would have wished, there is a feeling amongst analysts and think-tanks that the most feasible route is through exploring more resources beyond diamonds. As the Botswana Chamber of Mines (BCM), has the country made progress in this regard? What do see as signs of progress in this area (if any)?
CS: The exploration for minerals in Botswana has never been more focused. Discoveries of significant copper in the North West of the country now dubbed the Kalahari Copper Belt. Botswana is endowed with over 200 Bt of coal resources that can be exploited to significant revenue sources. The first Uranium mining site should be operational in the not too distant future. There are also significant iron ore deposits that have been discovered in the western part of the country. In all, if these exploration activities were to be converted into mining operations, we should see diversification of mining activities away from diamonds. It should be emphasised though that diamond mining will still remain the anchor activity in the economy of Botswana.
AMB: With regards to diamond mining, we have seen a shift from merely exporting raw diamonds to beneficiation through cutting and polishing. Does the Botswana Chamber of Mines (BCM) see progress being made in this area? What has the country achieved so far and where could there be room for improvement? Are we seeing progress in this area was initially envisaged?
CS: The diamond beneficiation project yielded good results initially but has rather slowed down due to economic factors affecting the world at large. At its peak, the diamond beneficiation project created employment and had positive contribution in the local economy. As a result of the global slump, some of the diamond cutting and polishing factories have had to close down, whereas others invested to fill the void though not to original levels.
AMB: Of late reliable supply of water and power has become big challenges to the economy. What do you think could be the magnitude of this on the mining sector’s output in general?
CS: Currently, the mining sector remains shielded from the vagaries of the water and electricity challenges facing the nation. Thankfully, there is recognition that the economic contribution from the mining sector should be allowed to grow, but in a prudent and not wasteful manner.
AMB: In terms of getting the necessary paperwork (operating licences, work permits and EIA clearances) on time how does Botswana compare with other countries in the region? What could be done better?
CS: We recognise that there are some areas of improvement in the issuance of permits. This area has been given the right focus by the respective authorities and we should see an improvement in the way these are carried out in the future.
AMB: In general, what do you consider as milestones in the Botswana mining sector in the past two years?
CS: There have been numerous developments, but the diamond beneficiation project remains the biggest milestone in the previous couple of years, thus far. Hopefully, there will be more in the coming years, conditions permitting.
AMB: Notwithstanding the obstacles, what would you consider as the competitive advantages that Botswana has over other countries as the ideal destination for mining capital?
CS: The stable governance of the country has been and continues to be a top priority to investors, coupled with favourable financial and taxation statistics.
AMB: What are the Botswana Chamber of Mines’ objectives in the coming years?
CS: I can precisely say that the strategy set for the coming years is to grow the organisation to an extent that it offers its members more services than is current. Of course, we have a number of objectives in place to ensure that the strategy comes to fruition.