10 Mar 2016

The Vice President, Mr Mokgweetsi Masisi says government has over the years introduced a number of initiatives aimed at developing and enhancing the local capital market.  

Speaking at the Botswana Stock Exchange (BSE) inaugural listing conference in Gaborone yesterday, the Vice President said government’s commitment to the development of capital markets was not only through privatisation of public entities and provision of infrastructure support, but also by further public sector reform to provide a more enabling environment for private companies to flourish.

Mr Masisi said in 2008, government invested in the establishment of the Central Securities Depository Company of Botswana (CSDB) which operates the Central Securities Depository (CSD) system.
“The latter is an electronic share register or share depository bank and a custodian bank of listed securities, which has replaced the necessity to issue paper share certificates,” he said.

He said in 2012 government funded the introduction of the Automated Trading System (ATS) at the BSE. He said these infrastructure investments have transformed the bourse and domestic market in a tremendous way.
“In addition to increasing productivity and efficiencies at the BSE, the CSD system has helped reduce systematic risk in the market whereas the ATS has helped to promote BSE’s reach and accessibility,” he said.

He said these public contributions have made the domestic capital market attractive to foreign investors, giving the BSE the muscle to register impressive levels of trading activity.
Mr Masisi said the investment in the infrastructure has ensured that listed companies benefited extensively by being part of the Exchange.

“With this existing infrastructure base, you are certain that the BSE will give you value for money once you are listed,” he said.

The Vice President said in 2015 the BSE’s Domestic Companies Index (DCI) outperformed the Emerging Markets as measured by the Emerging Markets Index (MSCI EM) including the JSE All Share Index (JSE ALSI) and the Stock Exchange of Mauritius Index (SEMDEX).

“The DCI appreciated by 11.6 per cent, whereas the JSE ALSI appreciated by 1.9 per cent and the MSCI EM and SEMDEX lost 12.7 and 17 per cent respectively.

Vice President Masisi said various reputable indices including those from the World Economic Forum and World Bank continue to consistently credit Botswana for prudent macroeconomic management and its strong public institutions and rule of law.

“In the coming decade we want all to progress to a more prosperous and productive Botswana that leaves no Motswana behind. Beyond graduating to a high income status, we are committed to achieving a society free of unemployment and absolute poverty,” he said.

To achieve this, the Vice President said the private sector has to be unleashed through greater market capitalisation as well as government’s delivery of an enabling environment, to profit from innovative opportunities.
The conference comes after the closure of Botswana Telecommunications Corporation Limited (BTCL) Initial Public Offering (IPO) which the Vice President said resulted in a number of applications from investors across the country.

“This surge included many who were purchasing shares in a listed company for the first time. There is no better example of citizen economic empowerment,” he said.

The Vice President said companies listed in the stock market are better positioned to raise capital to pursue investment opportunities nationally, regionally and internationally, in the process create more employment opportunities for Batswana and contribute to Botswana’s GDP.

Meanwhile, Mr Masisi said Economic Diversification Drive has been fully incorporated into the guidelines that govern the Economic Stimulus Programme. Ends