Buoyed by a favouring Court of Appeal ruling last week Friday, Botswana Public Officers Pension Fund (BPOPF) this week revealed they were surging ahead with their strategy to grow the Fund. This will involve giving citizen companies an opportunity to manage assets as well as explore Africa and China markets.
BPOPF Principal Officer, Boitumelo Johnson appeared relieved after Court of Appeal President Justice Ian Kirby confirmed the appointment of a Statutory Manager for Capital Management Botswana(CMB), an entity that has been managing some of the Fund assets. BPOPF has fallen out with the former over several irregularities as well as alleged corruption by directors in executing their investment mandate.
Now that CMB has been placed under statutory management, Johnson told the media that all their efforts will now be focused on ensuring that diversification of investment portfolio under the Investment Policy Statement (IPS) goes unhindered. The investment committee is expected to give the Fund the leeway to invest in China and other African markets, so as to spread risks and get maximum return on investments, all for the benefits of members, active, deferred and retired.
Johnson speaks highly of China, which is under the Premiership of Xi Jinping. “China is a unique market with many opportunities,” said Johnson who was appointed the head to the country’s biggest fund in 2015. He said the good part about Chinese equity space is that there is limited external investment in their territories.
“Of course we will be entering the market with caution,” noted Johnson. BPOPF will be thriving on the matured economy such as China, which is the world’s biggest economy after the United States of America (USA). In May 2018, International Monetary Fund (IMF) stated that, the Chinese economy will expand by 6, 5 percent this year, but warned that rapid credit growth and trade frictions could pose risks for the world’s second-largest economy.
On other updates, the BPOPF boss announced that the Fund has injected P1 billion into two local companies under their incubation programme. Lighthouse Capital, a company owned by a local Bame Pule but based in Johannesburg, South Africa as well as Aleyo Capital has been given local mandates of P500 million apiece.
Aleyo Capital is owned by former Botswana Development Corporation’s investment chief, Bafana Molomo. The BPOPF Chief stated that their expectation is that the two companies will be investing in the local economy. “We want them to generate growth and help grow a good number of SMMEs,” he said.
BPOPF also confirmed they have not awarded a tender worth P500 million which is targeting the local listed equities. “None of the locals met the requirements,” said the BPOPF top executive without stating if they will re- issue the tender or not.
There is another top priority for BPOPF especially after the Court of Appeal ruled out that, the Non-Bank Financial Regulatory Authority(NBFIRA) was right in appointing Peter Collins as Statutory Manager of CMB, a company which was given P400 million to invest in the local market by BPOPF.
CMB and BPOPF are partners in Botswana Opportunities Fund, which in turn holds 40 percent of Bona Life though their partnership squabble is still before the arbitrators. Meanwhile, Botswana Guardian understands that BPOPF was expected to meet the Statutory Manager of CMB, Collins on Wednesday to discuss what steps to follow now that CMB, which has held over P400 million on behalf of the Fund, has been placed under statutory management.
The Statutory Manager is expected to make a full report to the regulator. CMB has invested in local companies such as Cell City and Wilderness Safari although such investments have come under spotlight. As things stands, BPOPF is seeking to get back the over P400 million given the company once the statutory management is over.