21 Mar 2018

Minister of Finance and Economic Development, Mr Kenneth Matambo says no money was approved nor paid from the Consolidated Fund to BCL from 2002 until closure.

Responding to a question in Parliament from Selebi Phikwe West MP, Mr Dithapelo Keorapetse, Mr Matambo said no payment was made to BCL as subvention for any financial year from 2002.

However, he said government assisted BCL directly or indirectly from 200 in the following ways; an amount of P356.3 million under the EU SYSMIN facility was on-let to BCL and Tati Nickel Mining Company and disbursed between the period 2003 and 2009.

“Due to BCL’s dire financial situation, including its heavy debt, government deferred receipt royalties due to it, amounting to about P1.26 billion,” he added.

Out of the balance of about P3.4 billion, which was owed to government by BCL, Minister Matambo said BCL was allowed to pay only P1 billion, while the balance of about P2.4 billion was converted to shareholder equity in February 2014, as part of the restructuring of BCL balance sheet.

He said government also advocated and provided comfort for debt relief from third party lenders, such as; Industrial Development Corporation of South Africa and Kreditanstalt Fuer Wiedaranfbau of Germany, adding that ‘BCL owed these financiers about P3.11 billion.”

In order to relieve BCL of its obligations under its existing tax agreement, he said government also waived a total of P155.4 million of interest and penalties for the tax years 2006 to 2011, which were payable by BCL.

Further, Mr Matambo said government extended a guarantee in 2016 for an emergency funding facility of USD100 million (about P1.08 billion at the time) from Barclays Bank of Botswana and ABSA Bank limited.

“As BCL ultimately failed to repay the loan, government had to honour its guarantee obligation and repaid the loan,” he said.

“It should be stated that BCL did not start operating from 2002, therefore the assistance provided by government as indicated in this answer is an understatement of the total assistance provided during the life of BCL,” he added.

Mr Keorapetse had asked Mr Matambo to state the exact amount from the Consolidated Fund approved by Parliament, which was given to BCL from 2002 until closure.

He also wanted the minister to state how much was paid to BCL as subvention each financial year from 2002 and other amounts the government paid to BCL from 2002 from other funds or in other forms. ENDS