22 Jul 2014

Vice President, Dr Ponatshego Kedikilwe says Pula Steel and Casting Manufacturer project is an important milestone towards government’s strategic objectives of economic diversification.

Speaking at the ground breaking ceremony of Pula Steel and Casting Manufacturer plant in Selebi Phikwe recently, Dr Kedikilwe said the project, which was established in partnership with BCL Mine through its Polaris II initiative, would enhance the economy of the town and by extension enhance the entire economy of Botswana.

He explained that Pula Steel was a startup company financed by CEDA in which P89.5 million would be invested. He said the project would create 1 000 direct jobs at full production.

Furthermore, he said the plant would process scrap metal into different types of steel and would reduce the burden on the country’s foreign exchange reserves used on imported steel.

He noted that products that would be produced at the plant include round/deformed steel bars, construction and civil engineering products and angel iron as well as cast iron products such as manhole covers, three legged pots and earth inspection chambers, among others.

Dr Kedikilwe indicated that with the plant’s main raw material being scrap metal, the total consumption would be 86 400 tonnes per annum.

He explained that the project was not only critical to the country’s economic development, but also entailed many ripple effects such as immense contribution towards human capital development through skills transfer.

He also noted that the plant would not only reduce the import bill, but would also serve and buttress the mandate of the Selebi Phikwe Economic Diversification Unit to promote economic development sustainability of the region.

“Botswana and especially Selebi Phikwe is strategically located in the heart of SADC to provide an additional fully integrated facility through the capacity of Pula Steel to serve the regional and local markets,” he said. He indicated that according to International Trade Statistics, SADC imported about P47.1 billion of steel in 2013.

He said the demand for steel in Botswana amounted to P2.6 billion in 2013. “The demand was met by importing from a number of countries with South Africa being the largest source of imported steel at 50 per cent followed by China with 40 per cent,” he said.

The scenario, he said had made Botswana net importers of steel at a very high premium.

As a result, several projects including some national development ones have been delivered at exorbitant costs, he said.

“In this regard Pula Steel brings hope and has the potential to assist in mitigating costs of some public infrastructural projects by supplying locally produced steel of comparative quality,” he said.

Dr Kedikilwe further said that the new business venture would be a springboard for BCL Mine in developing the iron production circuit to curb reliance of import of steel and steel related products.

“As we celebrate the visible milestone in the journey of BCL Limited Polaris II strategy espoused to diversify its portfolio effectively leveraging its technical capacity in mineral extraction and processing built over 40 years , it is equally important to acknowledge the company’s transformation from being a single commodity mine to a completely diversified business enterprise,” he said.

He further explained that one of the aims of the BCL Mine Polaris II strategy was to beneficiate iron ore, which would create employment opportunities, reduce steel imports and generate foreign exchange for the Botswana economy.

“While we celebrate the beginning or a new era in business in Selebi Phikwe, I wish to indicate that the investment, the skills of the workforce, the technical knowledge and the location are all important.

A harmonious working relationship between the investors, the workforce and the Local Authorities is of great significance,” he said. ENDS