18 Jun 2025

Any new infrastructure development that government undertakes, must demonstrate value addition, whether in lowering transport costs, enabling exports, improving reliability or catalysing job creation and innovation.

This is because funding such projects has become difficult due to the reduction of government revenue, owing to the dire situation with diamond revenue, Minister of Transport and Infrastructure, Mr Noah Salakae has explained.

He was speaking at The Future of Mining Summit, Tuesday, in Gaborone where he noted that the era of large infrastructure projects that did not deliver an adequate economic return was over as government no longer could afford investments whose value for the economy and the citizenry alike was not clear or measurable.

Mr Salakae emphasised the need to transition from viewing infrastructure as a cost centre and understand it as a productive asset, generating economic returns, improving competitiveness and securing Botswana’s regional position.

To that effect, Minister Salakae stated that dominant users of infrastructure particularly capital intensive industries such as mining and oil companies would be expected to contribute directly to both capital and operational costs of the new works from which they benefit.

“As we leverage the Public-Private Partnership model to unlock value in our logistics sector, it is equally urgent that we explore innovative methods of infrastructure financing. “The capital requirements to modernise and expand our transport corridors rail, road and port connectivity are substantial and cannot rely solely on traditional budget allocations or donor flows,” he said.

To address this,  he said the government was exploring the issuance of infrastructure bonds, including green and sustainability-linked bonds, to attract private capital from both domestic and international markets. 

Minister Salakae further urged that pension funds, insurance companies, and private equity players be engaged as strategic partners, not just financiers, in advancing national development. He said government was also establishing new funding modalities such as shadow tolling, cost sharing arrangements and user-pays mechanisms to implement this principle fairly and transparently.

Additionally, Mr Salakae stated that Botswana’s creditworthiness, combined with the long-term revenue potential of user funded logistics assets, provided an attractive proposition for investors.

Therefore, he pleaded with investors and financiers to look at Botswana not as landlocked but land-linked country.

“We offer stability, reform-minded leadership and commitment to infrastructure that work for mining and beyond. To regional partners, let us strengthen our corridors. Infrastructure is integration in physical form and regional growth depends on it,” he said.

He said government was pursuing PPP  to unlock rail revitalisation, such as the Trans-Kalahari railway and for rail link upgrades to Mozambique and South Africa to access diversified port options. ENDS