Consultants pocket P13m for BMC privatisation

Andrew Maramwidze - BG reporter
Tuesday, 11 June 2019
Consultants pocket P13m for BMC privatisation

The cogwheels have started moving hardly a week after government made a commitment to liberalise Botswana Meat Commission (BMC).However, the big elephant in the room is to achieve expectations of both farmers and other stakeholders yearning for the end of BMC monopoly. Jimmy Opelo, the permanent secretary in the ministry of agriculture and food security remains optimistic and sees a silver lining on the initiative. “We have been waiting for this moment longer than you can imagine,” said Opelo

breaking news that government has appointed a consultant to steer the project through the Public Enterprises Evaluation and Privatisation Agency (PEEPA). Minchin & Kelly is being paid P8.7 million to guide the Commission’s privatisation that is expected to end the beef export monopoly. Opelo said accommodative steps will be taken in the privitisation of BMC, ensuring that all options are looked into, although skepticism linger on that government may not make the decision that the farming community prefers. PEEPA Chief Executive Officer Obakeng Moumakwa said Minchin & Kelly will develop a strategy and transaction plan in the next three months to guide the parastatal’s privatisation. “Their responsibilities will include carrying out a business, financial and human resource assessment of BMC, valuation of BMC and submitting a comprehensive project completion report at the end of the project,” said Moumakwa highlighting that the project is expected to be completed by end of August.

Moumakwa said BMC privatisation process has been a long but very informative process that involves consultations with all key stakeholders, particularly farmers, since privatisation of BMC impacts on their livelihoods. “Their concerns and suggestions were duly noted and taken onboard because it is government’s commitment to ensuring that privatisation is fair, transparent and in the best interests of Batswana,” said Moumakwa. But Gantsi North legislator Noah Salakae argues that the money being paid Minchin & Kelly should at least have been used to cut the debt that government owes to farmers. “That is, if the government is committed to addressing  the plight of the farmers, chief of which is breach of contracts/agreements the government gets into with farmers,” said Salakae adding that a responsible and caring government listens to the people and executes what people want.

BMC spokesperson Brian Dioka told this publication that BMC has paid in excess of P150 million to farmers since January and owe an outstanding P60.5 million as of today. He said that the figure keeps fluctuating as farmers keep bringing cattle to BMC and the Commission has set itself a target of 30 days to make payments for any consignment delivered to BMC.  “Currently the daily throughput has increased ahead of the looming drought and winter season,” he said, adding that Lobatse is operating at maximum 650 cattle a day. Salakae said the consultancy for BMC privatisation is clearly a delaying tactic, as farmers know what they want and have told the government many times at different fora. “They are saying public interest is paramount. People want de-monopolisation of the BMC Act, privatisation and other self-serving government pursuits must occupy secondary place.   “Why is the government commissioning so many consultancies when there is no confusion as to what the farmers and general populace want and how it should be implemented,” queried Salakae.

He said government should be honest enough to share her fears with respect to implementing the farmers’ wishes. Leaked snippets from the KPMG Feasibility study on the liberalisation of the Botswana beef export market indicates that regulated liberalisation of the beef export market is the most feasible mechanism to drive reform in the beef export sector and improve the productivity of both the cattle industry and beef export sectors at a national level. The report says the first driver is to ensure that the sector develops and is able to remain economically sustainable without undue commercial involvement of government. In addition it is to ensure that players in the market, including cattle producers, receive competitive prices for their products, reflective of their contribution or value-add in the industry.

Meanwhile another consultant Deloitte has been appointed as a transaction advisor to assist with separating the Maun Abattoir from BMC Lobatse and Francistown. Deloitte will be paid P4, 2 million for the task, which involves finding a concessionaire to operate the Maun Abattoir, establishing a new limited liability company to house BMC Maun, providing technical advice during negotiations and finalising and signing of concession agreement with the preferred concessionaire.

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