BOTASH
In the late 1980's Soda Ash Botswana was seen as the bright new star in the Botswana's efforts to diversify the national economy away from its principle base of diamond and beef export. A massive plant was erected at Sua Pan, in the Makgadikgadi Pans, a railway line was built and the future looked rosy.
By 1995, however, various factors had forced the company into liquidation. The chief of these was crippling foreign debt and aggressive competition from America in the prime market of South Africa. The company was restructured. The Botswana Government now holds 50% of the shares; Anglo American Corporation, AECI and De Beers a further 42%; and a consortium of South African Banks the remaining 8%.
Once again the company was viable, jobs had been saved and Botswana Railways looked like recouping some of the millions of Pula it had lost in the liquidation.
Botswana is a hard land. In early 1996 unprecedented rains flooded Sua Pan and a crucial wall collapsed. Salt production was halted for the foreseeable future.
Since then, round the clock operations involving 400 workers, the Botswana Defence Force and Dutch dredging experts using 12,000 tyres and 90,000 sand bags have shored up the berm. The flood waters have been pumped out of the solar ponds which are now once again being filled with brine. Full production levels are expected to be attained in October.
Reasonable stockpiles and the purchase of 27,000 tonnes of salt from America and the co-operation of small South African operations has meant that business losses have been kept to a minimum. Botash has been able to retain 75% of the South African Market and almost all of the Zimbabwean market while exporting to Zambia as well. 550 employees are relieved and there is talk, although still very vague, of a listing on the Botswana Stock Exchange after a period of consolidation.
The content of this article is intended to provide general information on the subject matter. It is not therefor a substitute for specialist advice.
Minchin & Kelly (Botswana) - Gaborone (267) 312734
