Stanbic Bank Botswana’s role as a leading financial services provider in the Corporate and Investment Banking (CIB) space positions it as an ideal partner for growth in the mining sector. The bank already wields considerable influence and support through the entire value of the mining industry, and is committed towards further supporting Mining and Metals sector entities. These are the sentiments reiterated by the Bank at a recent engagement of Mining and Metals sector conference held on Thursday 18th August 2016 at Masa Square Hotel in Gaborone.
The bank’s expertise, experience and insight in financial solutions for the Mining and Metals sector stem from recognising the integral role of the sector to the development of African countries and their sustainable infiltration into international markets.
The Mining and Metals sector remains the primary source of both Government income and foreign exchange for Botswana. It has been the single largest contributor to Botswana’s GDP for over 47 years now, since the establishment of a Public Private Partnership between the Government of Botswana and De Beers.
Stanbic Bank Botswana Head of Corporate and Investment Banking, Sheperd Aisam said despite weaker global economic growth, they have seen a sustained level of demand for extractive minerals such as diamonds, signalling a need for continued support and financing of operations in this space.
“Stanbic Bank continues to lead the charge here, and has developed in depth mining sector expertise to support players within the industry. This is further supported by leveraging off the full capabilities of our parent, Standard Bank Group, who wields considerable experience in the sector across the African continent. We have extensive experience in providing innovative solution to the industry in the form of advisory, debt, capital markets, transactional products and services, to mention a few,” he said.
Additionally amongst the key points of conversation during the engagement were trends, both local and global, within the sector. Research indicates low commodity prices overshadowing the industry in recent years. Prices of most commodities such as gold, oil, copper, silver, iron ore, and coal have reached all-time lows. This has been attributed to weak market fundamentals, amongst them: weak global demand, credit restrictions in China, oversupply from new low-cost mining projects and a stronger US Dollar.
“Botswana’s diamond industry has also experienced the same downfall, as a record of dismal performance in diamond sales during the year 2015, with pressure mounting from overstocking in the midstream and a slowdown in consumer demand. This affected export earnings and Government revenues considerably. Although the demand of diamond sales significantly improved in 2016, the industry remains cautiously optimistic. Uncertainties surrounding key market fundamentals, such as consumer demand and liquidity concerns in the midstream continue to cloud the industry,” said the Mining and Metals Client Coverage Manager, Rebone Diloro.
Sector representatives in attendance ranged from mining houses to mining services companies, embracing the engagement as a platform for discussion and debate, as well as hearing more about key sectoral developments. Amongst the key speakers were: Walter de Wet, Global Head – Commodities Research, Standard Bank; Sheperd Aisam, Head Corporate & Investment Banking, Stanbic Bank Botswana; Nchidzi Mmolawa, Deputy Permanent Secretary (Minerals), MMWER; and Paul Smith, Chief Executive Officer, Minerals Development Company, Botswana. We were also humbled to host Eric von Glehn and Peter von Klemperer, Mining & Metals Executives from Standard Bank.
“It is important that we continue to create platforms to share and discuss such aspects, so that we can cross-pollinate ideas and efforts across sectors to help grow Botswana’s industries. As Stanbic Bank Botswana, we are committed to supporting the Mining and Metals sector so as to contribute to a stronger national economy, using our collection of capabilities and experience to help drive sustainable growth,” said Aisam.