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BOTSWANA’S BUILT ENVIRONMENT NEWSPAPER | Vol. 5, Issue 8 | august 2015
www.boidus.co.bw
hOmE imPROVEmENT
DIY Special: How to Install
New Kitchen Cabinets p11
PROFEssiONAl PRAcTicE
lOcAl NEWs
Branding Gaborone into a
Diamond City delayed
p2
MAIN FEATURE
Innovation in Housing How New Building Technology
Could Solve the Affordable
Accommodation Problem
• Developing local building material products - Earth Brick - BITRI • Prefabriated housing technology - Fastrak • Housing protypes and modular housing - BIH By Kibo Ngowi
Protection for Contractors against
Insolvency of the Employer p10
Get to Builders Warehouse.
Get it done! SPEAK TO US ABOUT A TRADE ACCOUNT! BUILDERS WAREHOUSE BOTSWANA: GABORONE: Airport Junction Shopping Centre, Plot No. 70665, A1 Road, Tel: 00267 393 0533
FRANCISTOWN: Plot Number 31247, Mowana Park, Somerset West Industrial, Along A1 Road, Tel: 242 5200
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What Does Financial
Inclusion Mean for Property? By Sethebe Manake
Financial Inclusion is currently on every government and financial services sector agenda in Africa. It has also found a very important place on Botswana’s Agenda. Financial inclusion
is about making financial services accessible to individuals that have generally had no access to the same services in the past.
p8
Mowana Park Expansion Influenced by Customers
and Not Competition, says Owner
By Keeletsang Dipheko and Kibo Ngowi
It’s no secret that the majority of Batswana are struggling to afford decent accommodation but not enough discussion has been directed towards possible solutions. Boidus Focus examines innovative initiatives with the potential to help solve the affordable housing problem. We found
out about the new technology BITRI has developed to make bricks out of Kgalagadi sand; go inside the sustainable housing units BIH is developing in partnership with a Swedish based NGO; and learn about constructing houses with the use of steel. p3,5,9
Botswana Insurance Company:
International News South African Construction
construction liability
p15
Ten years into its existence, Phakalane’s only upscale retail centre, Mowana Park, is undergoing an expansion which will see it bring on board a Choppies Hyper and what promises to be the largest Woolworths Foods in Botswana. Yet the
CEO of Synergy Group, the Mowana Park owners, insists that this move was influenced by customer demand and has nothing to do with the tightening competition in Gaborone’s retail sector.
p6
Report:
sector hits hard Times
p12
Mortgage Lending Rises WhileThe mAJORiTy REmAiNs EXcludEd
p15
BOIDUS FOCUS AUGUST 2015
LOCAL NEWS P2
NEWs BRiEFs August 2015 Compiled by Keeletsang P. Dipheko
Branding Gaborone into a diamond city delayed by financial Constraints Assistant Minister of Local Government and Rural Development Frans Van Der Westhuizen recently told parliament that government’s intention of transforming Gaborone into a city at par with diamond cities such as Antwerp, Belgium and London, UK has not yet been undertaken as an official exercise due to budgetary constraints. He said in the meantime various initiatives have been prioritised for funding during the next budget cycle. “In terms of public infrastructure, a number of social infrastructure projects are currently on-going that will drive the Diamond City initiative,” said the Minister, “Such as improvements of road infrastructure, installation of streetlights at the Central Business District (CBD), maintenance of traffic lights and street lights, as well as the development of recreational parks.” Van Der Westhuizen added that a number of programmes and policies are in place to facilitate the provision of high-end facilities and services that are targeted at high profile city visitors: “This includes the CBD master plan that prescribes the kind of developments that are allowed at the CBD and in the process coming up with high end hotels and office complexes that are at the levels expected by international travellers.” The private sector has also come on board by partnering with the Ministry of Local Government and Rural Development through Gaborone City Council in the development of recreational parks and open spaces that are intended to improve the view of Gaborone. As part of these efforts, a park along Nelson Mandela Drive has been developed through a partnership between the Gaborone City Council and the FNB Foundation. “The community will be involved in these initiatives as they will be affected by the turning of Gaborone into a Diamond City,” Van Der Westhuizen noted. “They will benefit either directly or indirectly from developments such as cultural tourism, sale of artefacts on the city streets, demand for rental space and others.”
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Projects spearheaded by sPEdu on course Progress
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The Minister of Trade and Industry Vincent Seretse recently updated parliament on various SPEDU facilitated projects, including the Platjan Bridge Construction and the Selibe Phikwe Airport. The minister was responding to a question asked by Member of Parliament for Selibe Phikwe West Dithapelo Keorapetse.
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Seretse said a total amount of P100 million has been approved for the Platjan project which is expected to be completed in 18 months. The tender is expected to be awarded by the end of August this year while the construction of the bridge is anticipated to commence in September. The Platjan Bridge will be constructed across Motloutse River into South Africa at the Botswana, South Africa border-post of Platjan, thereby improving access into the SPEDU region and other areas.
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The minister further explained that SPEDU is currently working with Civil Aviation Authority of Botswana and that BCL Limited funded the feasibility study of the Selibe Phikwe Airport which was completed this past April. The maintenance and refurbishing of the runway phase of the project has commenced. The contractor is currently working on the treatment of filling potholes with 40mm Asphalt overlay. The 65-day works commenced in June 2015 and are expected to be completed by 18th August 2015; the cost of refurbishment will be P14.7 million. Seretse mentioned other projects including Pula Steel Manufacturing and Casting Project; Management plan for Dikgatlhong, Letsibogo and Thune Dams; Horticulture Packaging and Processing Plant; and Motloutse Farm Electrification Projects. The Selebi Phikwe Economic Diversification Unit (SPEDU) is a regional development agency set up to spearhead the implementation of the economic regeneration programme for Selebi Phikwe and surrounding areas. Find these stories and more at:
www.boidus.co.bw
BOIDUS FOCUS AUGUST 2015
BOIDUS FEATURE P3
BITRI Develops Building
Technology with Kgalagadi Sand By Kibo Ngowi
Barclays Analysts Sound Alarm Bells on Chinese Real Estate Sector
Secondly, KSBB masonry units are cheaper than widely use types. To demonstrate the affordability of the KSBB, BITRI looked at real-life cost estimates based on two typical house plans, one medium cost and one low cost, comparing the total cost of walling using KSBB to five widely used types. For the medium cost, the total cost of KSBB walling was 82.6% of the cheapest and 33.0% of the most expensive of the five types of widely used walling material. For the low cost, the total cost of KSBB walling was 88.0% of the cheapest and 35.2% of the most expensive of the five types of walling. “The figures speak for themselves,” remarks Masuku. The rolling out of this technology for wide use could lead to millions of Pula in savings on building construction in Botswana. According to Masuku, the capital injection required to establish a factory to produce KSBB masonry units on a large scale will depend on whether or not there already exist such infrastructural requirements as power and water connections, bulk materials storage facilities, site office space and ablution blocks. An existing facility in MaubeloTsabong was upgraded to produce KSBB at a cost of P1.2 million while the cost estimate for establishing a KSBB depot in Khawa was P2 million.
Continued from the FRONT PAGE Botswana Institute for Technology Research and Innovation (BITRI) has developed a building block in which the main component is Kgalagadi Sand, a material that is abundant in Botswana. Dr. Esau Masuku, Lead Researcher in BITRI’s Building Materials Science Division, was the driver of the development of the KSBB, working with a team of nine people over the course of a period lasting several years and even pre-dating the formation of BITRI itself. The product was originally developed and patented by Botswana Technology Centre (BOTEC) and by virtue of having taken over the activities of the former organisation BITRI now owns the patent for KSBB.
The Kgalagadi Sand Building Block/Brick (KSBB) is a cost effective masonry unit made from Kgalagadi sand and a blend of ordinary Portland cement (OPC) with fly ash (FA). The input raw materials in the production of the KSBB are typically in the ratio by mass of about 76% Kgalagadi Sand (KS), 15% blend and 8% water. The weighting of the OPC in the blend can be as low as 35% by mass. Being a compressed earth block (CEB), the KSBB does not require firing. Thus, the KSBB is not only costeffective but also an environmentally friendly product, due to its low embodied energy. The use of KSBB in building construction comes with two key advantages over the use of other masonry units in wide use today. Firstly, the abundance of Kgalagadi sand in Botswana means that these units can be produced almost anywhere in the country. “By virtue of the fact that KS covers some 75% of Botswana territory, to an average depth of some 20m, the KSBB Technology is amenable to on-site practice,” says Masuku. “Thus, the determinant of the location of the KSBB Depot is not accessibility of the raw materials, but the location of the construction project.”
The Poverty Eradication Programme in the Office of the President (OP) has taken the lead in the rollout of the KSBB Technology as follows: Under OP’s Poverty eradication Programme, five locations throughout the country have been selected for the establishment of KSBB Depots. The upgrade of the Maubelo-Tsabong facility (one of the five) into a fully-fledged KSBB Depot, mobilisation for which is underway as we speak, is fully funded by the OP under the Poverty Eradication Programme. OP has also committed to fund the establishment of the blending plant in Palapye, the key facility in the commercialisation of the KSBB Technology, at an estimated cost of P4 million. On July 15th BITRI held a KSBB open day for the purpose of establishing partnerships with other government entities and private sector players involved in housing construction. According to Masuku, BITRI’s Building Materials Science Division is currently running four other research and development (R&D) projects, three of them contract projects which cannot be discussed without clients’ consent, and one an in-house project which involves the development of a KSBB mortar. BITRI was established in 2012 as a parastatal under the Ministry of Infrastructure, Science and Technology through an Act of Parliament. It was built out of the dissolution of BOTEC and Rural Industries Productivity Company (RIPCO), and is housed in the facilities that previously belonged to the two former organisations. The Mandate of BITRI is to identify and/or develop appropriate technology solutions in line with national priorities and needs of Batswana.
Barclays: Forget the Wild Stock Market Swings, China’s Real Estate Sector is what’s most worrisome and it accounts for 15 percent of Chinese gross domestic product The plunge in Chinese equities has grabbed all the attention in recent weeks, but a team at Barclays suggests we should be watching something else. Analysts led by Ajay Rajadhyaksha say that Chinese real estate is the sector to focus on, not Chinese stocks. Here’s their reasoning: “Over the years, much attention has focused on the massive share that investment commands in China’s growth. At 48%, it is much greater than the investment/GDP ratio in other emerging markets such as India and Brazil, as well as developed economies such as the US. What is perhaps less known is that real estate accounts for most of this increase. A quick glance at Chinese statistics shows that investment as a share of GDP has grown from the mid-thirties to 48% since 2000. In that period, real estate has gone from below 4% of GDP to around 15%.” As the analysts anticipate a “sustained slowdown” in the real estate sector in the coming years, the correlation of real estate and other parts of the economy such as auto sales or, say, steel output, worries them. (Real estate directly and indirectly accounts for 50 percent of all steel used, according to Barclays.) Meanwhile, the Barclays team cites a recent report from McKinsey estimating that nearly half of China’s debt is related to real estate. The influence of real estate on both China’s economy and its debt means that real estate bears close watching. Here’s the team’s conclusion: “We are aware that there are several pressing topics that we do not tackle in this report, including the outlook for the shadow banking sector, the size of bad loans on bank books and stateowned enterprise reform. We have discussed these issues in the past, and plan to do so again in the future. The outlook for the real estate sector remains the most important and the medium term path seems clear – a continued, multi-year slowdown of very significant proportions but not an imminent collapse. The Chinese economy remains on a glide path to slower but more sustainable growth over the next several years, though if we are right, the slope down might be a little steeper than many investors expect.” (BloombergBusiness)
CONSUMER EDUCATION P4
PART
1
Essay 1
BOIDUS FOCUS AUGUST 2015
PRACTICAL ADVICE GUIDE
August 2015
always settle for an affordable house Most, if not all of us, aspire to live in lavish houses in prestigious neighbourhoods. The reality, however, is that not all of us are able to instantly fulfil this dream and need to gradually work up to it. Occasionally, however, out of pressure of unrealistic life goals or trying to keep up with wealthier friends, family members, colleagues or associates, some people make the mistake of buying a property that is beyond their means instead of practicing financial discipline. The reasons for not being able to afford one’s dream house are varied and include the fact that houses are generally expensive, more so on the upper end of the market, and simply because the cost of living in Botswana is high compared to disposable income. Therefore, income, which lenders such as Botswana Building Society (“BBS”) consider to finance the acquisition of property, is the primary determining factor of how much one will be loaned. In addition to the asking or negotiated price of the property, other costs to bear in mind include Value Added Tax or transfer duty (whichever is applicable), conveyancing fees as well as those for structural and property valuation reports. In addition, mortgage lenders do not always fund 100% of the open market value of the property you are purchasing. In that event, you have to raise the difference between what BBS lends you and the price of the property. This and the price of the property may make it impossible for you to build your preferred house or to buy a house in your most favoured neighbourhood. However, not all is lost. At BBS we advise you to consider other areas outside Gaborone which have cheaper houses and land, such as Ramotswa, Modipane, Kumakwane or Rasesa to build your ideal home. The truth of the matter is that land in Gaborone and much closer
areas such as Tlokweng, Mogoditshane and lately Gabane, Oodi and Mmopane, is becoming too expensive for many Batswana.
We have, however, observed that instead of making a financially sound decision of buying or building house you can truly afford, some customers have taken a route which we discourage. They superficially inflate their affordability by taking up a personal loan, which in reality they can ill-afford, or selling livestock or other property such as fields (masimo) or another plot located in an area that they least like. Often what subsequently transpires is that such people, sooner rather than later, either struggle to support themselves and their families or default on their mortgage installments because the repayments on the house are too high for them, ending up losing the property through foreclosure. This, though, is an eventuality many can avert by lowering their expectations based on actual financial ability. Therefore, as BBS, we urge potential homeowners to keep an open mind and consider alternative locations for houses that may, in due course, turn out to be their wisest purchases. As stated, one has to consider factors such as the potential of the neighbourhood to develop into one of the most desirable. Most sought after neighbourhoods in Gaborone, Francistown and other areas of the country started in this way. So, your ideal home could be in the least likely area. Another thought is that tomorrow your fortunes may have improved and you may at that point improve or sell your modest house and upgrade to your dream house. So, do your research, talk to Estate Agents and other knowledgeable people about property generally, explore different neighbourhoods or outlying areas that you can buy into without compromising your financial well-being and we at Botswana Building Society will be happy to fund your purchase.
To buy or build your property visit any of our BBS Branches, BBS Head Office, call 3971396 for assistance or email us at bbs@bbs.co.bw and we will contact you.
BOIDUS FOCUS august 2015
BOIDUS FEATURE P5
BIH Creates Sustainable Housing Unit
China Homelife Fair
Comes to Southern Africa
By Kibo Ngowi
The inaugural China Homelife Fair, forming part of the global series of China product sourcing fairs, is set to take place at the Sandton Convention Centre in Johannesburg between 1 and 3 September 2015. The show will offer a lucrative opportunity for Southern African importers, traders and buyers to source high quality products directly from manufacturers at competitive prices. The event is organised by Meorient, a leading facilitator of Chinese business, and takes place annually in nine cities around the world – Sao Paulo, Istanbul, Dubai, Mumbai, Poznan, Cairo, Amman, Astana and now Johannesburg. The China Homelife Fair portfolio aims to connect well-established Chinese suppliers of quality products with regional buyers. The fair will welcome visitors, not only from South Africa but also from Botswana, Namibia, Mozambique, Swaziland, Zimbabwe, Zambia and Malawi. Continued from the FRONT PAGE Botswana Innovation Hub (BIH) has partnered with the Ikea Foundation, through Swedish based NGO Relief Housing Unit (RHU), to create a sustainable housing unit which incorporates issues of material use, durability, environmental impact, social acceptance, functionality and economic feasibility. The unit offers an alternative housing solution with the advantages of rapid deployment, solar renewable lighting, potential for rain water harvesting and use of local materials as value additions. One unit covers an area of 17.5m2 with a width of approximately 3m and a length of just under 6m. The unit, which features four small windows and one door, is delivered to site as two packages of approximately 130 kg. Therefore it’s easily transported to the desired location and once delivered takes only about four hours to assemble. It is expected that once in full production the cost of each unit will be around USD 1, 500 (P15, 000). The Ikea Foundation has already started production of the units based on the design of the prototype. Based on key environmental factors, logistical purposes, climatic and solar irradiance characteristics, Kweneng district was selected for deployment of the first prototype. On the 20th October 2014, Botswana Innovation Hub staff set up the prototype unit and handed it over on the 31st October 2014 to Mme Mosadiwasetswana Kaboaga, a resident of Khudumelapye in the Kweneng District. She currently uses the unit just like any one of her huts. The initial six months, which ran up to the end of April 2015, were dedicated to research and development in partnership with local research and public institutes. For monitoring, work was conducted by experts from: Botswana Institute for Technology Research and Innovation on building material; University of Botswana Architecture and Planning Department on design aspects; Department of Electrical and Building Engineering Services on structural aspects; and Ministry of Lands and Housing on the social and economic aspects of the house. “We are at a stage where we are discussing our proposed recom-
mendations from the monitoring report to be incorporated into their design,” says BIH Cleantech Coordinator Dr. Tiroyaone Tshukudu. “It’s only after this has been finalised that we will be ready for more experimentation before any wide scale roll-out. However, even in its current stage we feel we can still get more units for experimentation.” “BIH is intending to have a stakeholder engagement about the unit in the near future. Therefore, other stakeholders will be engaged after this workshop to play a key role in making this technology a success in the country.” Part of BIH’s mandate is technology adoption and diffusion to communities in Botswana and in this regard BIH has entered this project collaboration with the intent of evaluating its commercial potential. This aspect is expected to be fully explored at the end of the initial six months with the partners. A potential local market has been identified for the provision of durable shelters to remote and disadvantaged communities in Botswana that incorporate solar lighting, phone charging and rainwater capture. Additionally, there is potential to sell to individuals wishing to set up these more durable shelters at their farms and ploughing fields in preference to corrugated iron shelters. There is also a potential export market as BIH has established that Botswana was selected to house the SADC emergency disaster relief unit. These units can be rapidly deployed by international organisations to displaced communities in areas ravaged by natural disasters or armed conflicts. According to the organisation’s website, BIH was incorporated as a company to develop and operate Botswana’s first Science and Technology Park. The company is mandated to support new ventures and existing companies as well as to attract companies, universities, research and advanced training institutes to establish in the Science and Technology Park. This is intended to help transform Botswana into a technology-driven and knowledge-based economy, by promoting a culture of innovation and competitiveness among its associated companies and knowledge-based institutions.
This year’s inaugural show will have a dedicated focus on eight product segments: Hardware and Tools, Building Materials, Home Electronics & Appliances, Textiles and Garments, Furniture, Kitchen and Bathroom, Lighting, Escalators and Elevators as well as Power and Electricity. When choosing to bring China Homelife to Africa, Meorient International Exhibitions found that South Africa plays an important role as the hub to the whole African region for the import of Chinese products. Chinese export to this region is growing at around 20% year-on-year and the Chinese Government is keen on further enhancing the trade relations. China Homelife will provide a platform for Chinese manufacturers and African buyers to come face-to-face and do business over the course of three days. Due to the increasing volume of exports of products from China to Africa, Meorient feels that there is a need to further streamline efficient export buying processes within Southern Africa and its surrounding areas as 2014 saw $US15.4 billion worth of exports from China to South Africa. As part of the Chinese Government’s “One Belt One Road” strategy, the focus is now on emerging markets or BRICS countries as these are the markets where Chinese companies have more opportunities. China Homelife South Africa aims to increase trade relations between China and Southern Africa by offering a wide variety of quality products to top decision makers and buyers. To ensure efficient networking and successful negotiation at China Homelife South Africa, the Match-Making Programme will assist buyers in meeting the right suppliers and finding the right products to meet their business needs via prearranged meetings. A dedicated area on the show floor will offer free translation services between regional buyers and Chinese suppliers. The Hosted Buyers’ Programme is an exclusive service provided only to top buyers from outside of Gauteng and other Southern African countries. To qualify as a hosted buyer the company would need to be a major importer of products from China and the hosted buyer must be a senior executive in the company, with direct purchasing authority.
BOIDUS FOCUS AUGUST 2015
BOIDUS FEATURE P6
Mowana Park Expansion Influenced by Customers
and Not Competition, says Owner By Keeletsang P. Dipheko & Kibo Ngowi
Mowana Park Shopping Centre first opened its doors in 2005, occupying a niche as the only upscale retail outlet in the Phakalane suburb on the outskirts of Gaborone. Now, in its tenth year of existence, this mall is at the advanced stage of completing an expansion that began in February 2014 and is expected to reach completion in October this year. The main attractions of this 10,000sqm extension will be a 3,200sqm Choppies Hyper and an 800sqm Woolworths Foods, which will be the biggest in Botswana. The expansion will also include the addition of BMS, Nespresso, Celini Luggage, Plush Interiors, Cherry Melon, Keedos, Polo, American Diner and Rodizio, as well as a larger Pharma Lulu, amongst other shops. Chief Executive Office of Synergy Group Dan Moskovic explains that the decision to expand came as a result of the mall running out of shops to rent to potential tenants who had requested space. Synergy Group is the holding company that owns Mowana Park. “As Phakalane and the surrounding areas – Gaborone North, Oodi, Mochudi and nearby villages – have grown, so has the foot traffic at Mowana Park Shopping Centre and with it a demand for more variety of shops,” says Moskovic. When the mall first opened, there were only two other upscale retail centres in Gaborone, Riverwalk and Game City. Since then several others have opened and most threateningly to Mowana Park, no less than three malls have opened in the block 10 area, a short drive down
the A1 from Phakalane. Airport Junction, which is undergoing an expansion of its own, Sebele Centre and Northgate are concentrated in this relatively small area, offering alternative options for Phakalane residents. However, when questioned on how much the Mowana Park expansion has been influenced by the tightening competition within Gaborone’s retail sector, Moskovic insists that his mall still occupies a comfortable niche.
“Mowana Park Shopping Centre caters solely for Phakalane and the surrounding areas. We do not compete with the other shopping malls in Gaborone and focus on providing our customers with the shops they demand for their daily and weekly shopping, entertainment and hospitality needs.” Moskovic Further explains that they listened to their customers and have embarked on bringing in tenants that these customers have requested for. The increase in variety will not only bring in new customers but also keep their loyal customers coming back, he says, adding that Mowana Park remains the only fully air-conditioned shopping centre in Gaborone, and also provides free wi-fi access to all its customers.
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BOIDUS FOCUS AUGUST 2015
GUEST COLUMNISTS 7
MORWA: The Rising Son
The Journey that was and a Way Forward By Tefo Paya
On May 26th I left Gaborone and went to Johannesburg to meet up with my director, Warren Nebe and my musician, Volley Nchabeleng, to rehearse a play that I created and perform in, Morwa: The Rising Son.
But here at home we still do not have a place where we can all come together to create, collaborate, learn, exchange and ultimately develop our industry. The infrastructure is vital for the industry to develop, grow and ultimately thrive. We have a lot more jewels in this country, beyond diamonds. We have a culture, tradition and a creative identity that can inspire and motivate. Once the right infrastructure is developed in Botswana then we can truly realise the power of the Arts and help our Artists realise their true potential.
We were preparing for a thirty-two show tour at four different venues in South Africa: The State Theatre (Pretoria), Artscape (Cape Town), The Gymnasium and The Monument (Grahamstown). This tour was a culmination of a four-year journey that began with my first performance of Morwa at The Moving Space at Maru-a-Pula School in Gaborone, Botswana. This was during the Maitisong Festival, with support from The Company@ Maitisong. Fast forward to today. I have returned from the tour, during which I received a Standard Bank Silver Ovation Award, a prestigious award given for achieving excellence at the Grahamstown National Arts Festival. The award came with prize money and partial funding for Morwa or a new production to be presented at the Festival next year. I was honoured that Morwa received this award because it showed that as Batswana we can produce work of high standards that is recognised and acknowledged internationally. However, instead of being happy and proud of the achievement, I found myself saddened by the reality of back home. The Arts industry in Botswana has a lot of potential; the government and private sector contribute in different ways to assist in further de-
Tefo Paya perfomaning Morwa the Rising Son at the Gymnasium Venue, Grahamston
veloping this industry. But most of what is being done is done without comprehensive consultation with local artists, thorough research, clear vision and a structured process. For example, how can the Arts develop without a strong, well-structured and managed infrastructure? How many functional and effective theatre spaces do we have in Botswana? Spaces that are equipped well maintained and effectively managed. Venues that are versatile and can cater for various art forms. Venues that allow for a mix of local and international shows, amateur and professional, mainstream and experimen-
Construction Liability or, more correctly, is triggered when a claim is made against the insured (which often has to be in writing). So you’ll probably ask who cares and what do I mean? Well, whoever purchased this policy could just get shot in the foot in the event of a late liability claim being lodged against them. So let me explain.
By Christopher Burton I was recently surprised and somewhat shocked to see a Botswana insurer issue a single project construction policy which included a liability section that pays out on a “claims made basis”
offer in the Arts, I found myself wishing that more of what we have in Botswana could be shared with the rest of the world. The festival had other Batswana such as Phala Ookeditse Phala (Standard Bank Silver Ovation award winner 2015), Katlego Kesupile, Bokani Dyer and Ntireleng Berman. They were all involved in various performances and were all highly rated and acknowledged. This shows that Botswana has a lot to offer in terms of the Arts.
Liability policies have traditionally been issued on what is called a “losses occurring basis.” This means that the policy will respond to legal liability arising from “injury” to persons or “damage” to property occurring during the period of insurance. The policy is triggered on the occurrence of loss or damage. These policies have what is called a “long tail” as potentially a third party can make a claim years later as long
tal, cultural, traditional and contemporary works of Art to be showcased. Places where the Arts are allowed to grow and develop, where audiences can come and truly experience what the Arts are capable of, thus giving Batswana a place where they can be inspired, challenged, gain deeper insight, engage with culture, identity, tradition and ultimately embrace Arts in all its forms regularly. To date, we still do not have a State Theatre or National School of The Arts. Places that are solely focused on the Arts and nothing else. As proud and honoured as I was to share a small piece of what Botswana has to
as the incident has not been prescribed in law. As a result largely of asbestosis claims that started to emerge during the sixties and seventies, insurance companies have sought to limit this “long tail” liability by the introduction of “claims made basis” policies. This means that the policy will respond to legal liability arising from “injury” to persons or “damage” to property occurring during the period of insurance and where a claim is made against the insured during the period of insurance. The policy is triggered when a claim is made against the insured and the insured reports the loss to insurance company. This means that as long as a claim is made when the policy is in existence, claims can be made against the policy. This is unlike the “losses occurring basis” where the policy can lapse and claims can still be lodged at a later date. With single project construction policies the
The primary purpose of an Artist is to use their skills and talents to stimulate and support positive growth. Their craft must be used to serve a greater good. This is achieved by striving towards Truth, Openness and Passion. Through this the Artist is able to take action from a place of Truth. The work they do is presented openly, without fear or favour. The Artist is driven by an endless passion. They are passionate about their craft, passionate about people, and ultimately, passionate about life. The Artist must be committed to growth, from the personal to the public. This is the Artist’s true purpose and they must be willing to sacrifice everything for this. Our artists need to be given more support in order to realise their purpose and place in our society.
policy lapses at the end of the defects liability period and so therefore would the liability protection afforded under the policy if the wording was on a “claims made basis.” So any claim notified or lodged with an insurer after the expiry date would not be covered. It is possible to purchase what is known as an “extended reporting option” normally at the commencement of a “claims made” policy which will allow claims to be reported after the expiry date for a specific period of time. Unfortunately in the case that I am referring to, this option was not taken advantage of. So my advice here is to always purchase single project construction liability insurance on a “losses occurring basis” and sleep well at night. er in place. Christopher Burton is an Underwriting Manager at BIC.
GUEST COLUMNist P8
BOIDUS FOCUS august 2015
The Real Estate Advantage:
conventional means of earning income.
What Does Financial Inclusion
The farmer who harvests his crops seasonally should be allowed to take out a mortgage on his house that understands he will not make equal monthly instalments, because he lives at a minimum. For the young adult who would like to buy her first home, it would be great to have staggered fixed interest rates that will adjust as her career grows.
Mean For Property? By Sethebe Manake
On that note, why are all financing quotes for the ordinary man pegged to prime? Why don’t we just agree what my repayment cost is and give me the opportunity to take the risk on the future movements of Prime? To me, the conversation on financial inclusion is well past its time. Let us inclusively discuss how we can include the majority of our population in formal financial services because, in my opinion, reaching that goal signals economic and investment maturity for our markets, opening a world of opportunity for investment products to drive our economy. Continued from the FRONT PAGE Financial Inclusion is currently on every government and financial services sector agenda in Africa. It has also found a very important place on Botswana’s Agenda. Financial inclusion is about making financial services accessible to individuals that have generally had no access to the same services in the past. Not being a financial expert, I do find myself wondering how financial exclusion has affected the real estate industry in the past and how inclusion will affect the future of real estate in Botswana. Consequently, I consider: What does this financial inclusion proposition mean? And at what point would we be able to say it has been achieved?
Our precision simply comes standard..
Most real estate transactions in Botswana are financed through banking, which begs the question: How has the unbanked adult population been financing their property developments and acquisitions? We have seen the inspirational gems who have taken time building their homes, one brick at a time, usually completed when they are no longer able to work; Hats off to them, but what about everybody else?
The key requirement to getting financing is usually proof of a consistent constant cash-flow. With a population that is slowly moving towards diversification and constantly being encouraged to go into Agribusiness ventures, and other businesses, the probability of people achieving consistent constant cash-flows is decreasing. As such, more and more people fall into the exclusion bracket, at least for accessing mortgages. So what do we, as the real estate sector, require of these financial inclusion talks? Mostly, it is the development of financial instruments that are affordable, flexible and agile enough to fit our un-
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According to the World Bank, which is leading these financial inclusion talks, 38% of the world’s adults do not use formal financial services, and 73% of the poor are unbanked because of costs, travel distances and the often-burdensome requirements involved in opening a financial account. Moreover, the globe’s unbanked population includes more than half of adults in the poorest 40% of households in developing countries.
BOIDUS FOCUS AUGUST 2015
MAIN FEATURE P9
Fastrak Introduces
Steel Housing to Botswana
By Kibo Ngowi
Winterwise gardening Waterwise gardening aims to make use of the best of indigenous plants to green our garden environment. Planting locally indigenous plants means they will be adapted to the prevailing conditions and, once established, should become self-sustaining. This not only leads to a reduced gardening bill, but also contributes towards environmental conservation.
Indigenous gardening is effective gardening, in harmony with the environment and favourable towards birds, insects, frogs and reptiles. The key to waterwise gardening is to create a garden that is appropriate for your area, so that it becomes easy to select the right plants. Remember, though, that individual gardens can have many different microclimates, so you can also choose suitable plants from other regions to add interest and variety. In order to make the best of your garden, you first need to understand your own environment so that you can select appropriate indigenous plants that are climatically adapted to your local conditions. Throughout the world, the natural forests are being steadily destroyed, yet these are the green lungs of our planet, absorbing carbon dioxide (C02) and releasing life-giving oxygen. (Remember your school biology lessons: plants ‘breathe in’ carbon dioxide and ‘exhale’ oxygen.) A decrease in forested areas means that less carbon dioxide is absorbed, so more of it remains in the atmosphere, where it traps the sun’s heat. This results in global warming which, in turn, precipitates climate change.
And, in Botswana, as elsewhere, once our environment becomes ever warmer and more arid, our natural water resources will come under increased pressure. In terms of gardening, this means we need to move away from expansive lawns and green ‘European’ gardens towards what is right for our land. Historically, plants from Europe and elsewhere were brought to Africa for planting in our gardens. At the time, there were definite benefits to this in both agricultural and horticultural terms. However, many of these plants came from countries with climatic conditions quite different from our own, so we ‘manipulated’ our local conditions by additional watering or enriching the soils in order to allow these ‘aliens’ to thrive. In a region where two-thirds of the land consists of semi-desert, gardening with high water requiring species has now become an expensive and wasteful practice and an unnecessary strain on our scarce water resources. Therefore, in the interests of conservation, we should strive towards having our everyday gardening practices be in harmony with nature. This way, not only will we conserve water, but our gardens will take on a truly African character.
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Continued from the FRONT PAGE Local company Fastrak Construction is pioneering the construction of steel housing in Botswana at what they claim is half the time and half the cost of conventional building methods. Fastrak is actually a subsidiary of Delta Aircons, which was established in Botswana in 1998, and has thus far built only two houses in the country with the steel construction method, both of them in Gaborone. One is a three-bedroom structure in Tsholofelo covering 91 square metres and built at a cost of around P360, 000. Fastrak is currently using it as a demo sample. The other is a two-bedroom structure in Metsimotlhabe which Fastrak has donated to a Church organisation. Therefore the company doesn’t have any past clients who can comment on the quality of these houses yet, but Fastrak is unsurprisingly eager to talk up the virtues of steel housing. “Light steel is the future; the material is durable, cost-effective and readily available,” Fastrak Managing Director Richard Sibanda told me. The foundations of these houses are conventional but the difference comes in with bringing up the walls. The walls are made out of plastered steel and Sibanda emphasises that there are very few people who know how to plaster steel but Fastrak has professionals with those skills. “The entire wall is steel so the building is for life; come rain, come sunshine, your building will be standing,” Sibanda enthuses. While the company hasn’t yet built houses for any clients, it has been engaged to do steel roofing projects for various buildings, including a secondary school, an apartment building, a council office block and some private houses. The advantages of the steel trusses are numerous, says Sibanda: Termites cannot attack it, it doesn’t rot, and it’s not affected by rain. Beyond that, there’s an energy saving element to steel houses in that the walls are built such that there is a capillary gap in between which reduces the
amount of either heat or cold coming from outside. Moreover, Sibanda insists it’s highly durable: “You don’t experience the usual cracking of the buildings, which occurs as a result of our shifting sands in Botswana. Most of the buildings in Botswana last for only 30 years because of the cracks brought about by shifting sands but steel houses last forever.” Sibanda says the technology has been approved by Botswana Bureau of Standards (BOBS) and the South African Bureau of Standards (SABS) but admits he still struggles with various councils that don’t understand it. When questioned on the challenges his company has faced, the Fastrak MD highlights the unawareness of the public about this technology as most people don’t know about it and even those who do know it need time to really understand and gain confidence in it. Additionally, the company is still up-skilling a lot of people, right from builders to carpenters, because they are moving away from conventional materials to something unconventional. So Fastrak is working to close the skills gap while also doing what it can to spread the word about steel housing construction. There is another challenge in that the company sources all its steel from South Africa but this could be viewed as a business opportunity for the domestic market. Last year Botswana took a step towards achieving self-reliance in the production of steel with the establishment of a fully integrated steel manufacturing company, Pula Steel and Casting Manufacturers, in Selebi Phikwe. Botswana currently imports all its steel from foreign countries with South Africa being the largest source at 50%, followed by China with 40% and the demand for steel in Botswana amounted to P2.6 billion in 2013, according to international trade statistics. Pula Steel is expected to invest a total of P89.5 million into a steel manufacturing plant which will create 1,000 direct jobs at full production.
BOIDUS FOCUS AUGUST 2015
pROFESSIONAL pRACTICE P10
Protection for Contractors against
Insolvency of the Employer By Natalie Reyneke
Clause 16.2 then entitles the Contractor to terminate the contract if the Employer fails to provide the evidence of financial arrangements, or fails to pay the Contractor. Clause 16.2 further entitles the Contractor to terminate the contract immediately if the Employer “becomes bankrupt or insolvent, goes into liquidation, has a receiving or administrative order against him, compounds with his creditors, or carried on business under a receiver, trustee or manager for the benefit of his creditors, or if any act is done or event occurs which (under applicable Laws) has a similar effect to any of these acts or events.” In this article we shall examine the various provisions of the JBCC, FIDIC and BIDP construction contract in relation to protection for Contractors against insolvency of the Employer. The Botswana Companies Act provides for the voluntary winding up of companies (by members or creditors) and creditors’ winding up (upon application to court by the creditors, when the company is unable to pay its debts). The Act further provides for judicial management instead of winding up. Without going into too much detail regarding insolvency law in Botswana, what is evident is that: • When a company is placed under judicial management, the court has the ability to direct that while a judicial management order is in force, all actions and the executions of any writs, summonses and other processes against the company be stayed and not proceeded with without the leave of the court being first obtained; and • When a company is wound up, the company ceases to carry on with its business. The prospect of any Employer being unable to pay a Contractor for works executed to date is a Contractor’s worst nightmare. When a Contractor receives a form of contract from the Employer, there
are generally provisions that deal with the rights and obligations of both parties in the unfortunate event of one of them becoming insolvent. It is up to the Contractor to assess the risk of that happening, and taking note of any of the provisions seeking to protect the Contractor in this instance being amended. A good example to start with is the FIDIC Red Book. The FIDIC Red Book at clause 2.4 states: “The Employer shall submit, within 28 days after receiving any request from the Contractor, reasonable evidence that financial arrangements have been made and are being maintained which will enable the Employer to pay the Contract Price (as estimated at that time) in accordance with clause 14 [Contract Price and Payment]. If the Employer intends to make any material change to his financial arrangements, the Employer shall give notice to the Contractor with detailed particulars” Clause 16.1 states: “If … the Employer fails to comply with Sub-Clause 2.4 [Employer’s Financial Arrangements] or SubClause 14.7 [Payment], the Contractor may, after giving not less that 21 days’ notice to the Employer, suspend work (or reduce the rate of work) unless and until the Contractor has received … reasonable evidence or payment ... and as described in the notice”.
Once a notice of termination is given the Contractor ceases all work and demobilizes from site. We have seen all too often that Employers delete the provisions of Clause 2.4. Contractors accept such deletion without batting an eyelid. But what they are really doing is giving up their right to avoid the potential situation that after executing works for the Employer, the Employer cannot pay them. This clause is a powerful clause for the Contractor, particularly if he suspects that the Employer is going into financial difficulties and the Contractor doesn’t have the cash flow to take that risk. It seems as though Employers delete this provision because it seems like too much admin, without understanding the implications to the Contractor. Contractors who have this option available to them in their contracts should use it. It may be a saving grace. The JBCC 2005 Principal Building Agreement doesn’t contain any clauses remotely similar to Clause 2.4 of the FIDIC Red Book. In addition, there are no express provisions dealing with the insolvency of the Employer. However, Clause 3.1 provides for the provision of a payment guarantee where required by the Contractor in his tender. Clause 3.2 states:
“The employer shall provide a payment guarantee where required by the contractor in the accepted tender…” If the Employer does not pay a certified payment certificate in time, the Contractor may, in terms of clause 31.16: “31.16.1 Issue a written demand to the employer in terms of the payment guarantee provided… 31.16.2 Exercise a lien…where it has not been waived … 31.16.3 Give notice of cancellation….” The Contractor has to wait only 10 days after issuing a notice of cancellation for the Employer to remedy the non-payment, failing which, he may cancel the contract and demobilise from site. Once again, the contract does provide the Contractor with an option to protect himself against an Employer that cannot pay. However, all too often we see Employers deleting the clauses relating to payment guarantees and insisting on waivers of lien. The BIDP building agreement deals specifically with determination of the contract (clause 26.1(d)) where the Employer becomes bankrupt or makes a composition or arrangement with his creditors. The Contractor has the option of exercising a lien over all unfixed materials and goods which may have become the property of the employer until all monies due to the Contractor have been paid. Conclusion While all 3 of the Contracts mentioned above have their own specific built in protections for the Contractor, Contractors are often all too happy to have won the tender to start thinking about the financial stability of the Employer and what remedies they have should the Employer suddenly find itself cash strapped. Contractors should be cautious about throwing their remedies away and allowing amendments to the clauses which afford them rights in these circumstances. Contractors should also consider performing a due diligence on Employers before electing to contract with them and should seriously consider requesting a payment guarantee where the contract so allows.
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OIDUS FO CUS
BOTSWANA’S BUILT ENVIRONMENT NEWSPAPER
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Sustainability Today: 06 Starting blocks with
change Botswana’s Architecture Design and Urban Landscape Newspaperclimate | JUN E 2013
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NEWS | page 02
EDITORIAL | page 04
Letlole Larona Breaks Ground at the Kromberg and Schubert Botswana (Pty) Plant
Intro Government to Promote IntroHow ready is Botswana for duction of Residential DevelopDevelop the Inevitable Change towards BOIDUS FEATURE > Decarbonisation targets? ment into the CBD Global
| Volume 4, Issue 7 | AUGUST 2014
Education Feature: 15 Botho University Builds Francistown Campus
Factors to Consider 18 When Establishing Sector Regulation
EDUCATION | pages 15
SUSTAINABILITY | page 06
www.boidus.co.bw
Guide to School Programmes: 2013 Built Environment Careers Guide
Meet three of Botswana’s best
BOIDUS EXCLUSIVE >
OIDUS FO CUS
BOIDUS EXCLUSIVE >
by Kibo Ngowi Bringing together key CBD stakeholders such as landowners and develop ers to engage on issues that affect their developments and investment
NEWS | page 02
BUILDINGS | page 06
A Luta Continua on the Land Question Airport Roof Gone with the Wind
The Idea of Eco Cities: Need for harmony between policy and green initiatives
BR Properties - Botswana’s first Parastatal Property Investment Subsidiary by Kibo Ngowi
BR Properties is a pioneer organisation as it is the first example of a
departments with ambitions of creating similar entities. Boidus Focus met
company established to commercially exploit the real estate assets of
with BR Properties Managing Director Oarabile Zhikhwa to explore the brief
The performance of this company will serve as a test case for many other
organisation.
a Botswana Government enterprise.
history and long-term ambitions of her >>> CONTINUED PAGE 05
“I would say that as an engineer, especially in the construction field, experience is crucial, which is why firms tend to only hire engineers with a high amount of experience for senior project roles. And that’s understandable to me, because as much as you can go to school and read books, there’s no substitute for actually being involved in a project...” - Matlhodi Keaikitse
Top: Guests and delegates at the CBD Event Bottom: Architect and Urban Designer Jo Noero from Noero Architects and University of Cape Town Right: Hon. Assistant Minister of Trade and Industry, Keletso J. Rakhudu, officially opening the event
The Boidus Media, State of our CitiesCBD Executive Seminar recently held
and the public in sharing of ideas and opportunities about our upcoming
at Masa Centre was by any measure a resounding success. The Seminar
CBD. Envisaged as the future heart of Gaborone City, the CBD is slowly taktak
event brought together for the first time ever in Botswana, key stakehold-
ing shape and the seminar sought to make it a centre stage focus of discusdiscus
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ers, government, industry champions
As you reflect on the ‘challenges and opportunities’ of developing a CBD, I would like to encourage all of you to think of this as what our generation will be remembered for having done, not only for this City, but for the nation, albeit through the toughest times. Assistant Min. of Trade & Industry, Hon. Keletso J. Rakhudu
by Boidus Admin
A Successful CBD represents among other things; • A success CBD Image of the city and the country Felix Chavaphi Portfolio • Generation of the country’s prosperity • Successful partnership between the Government & PVT[TOP] sector University of Botswana Library Dimitri Kokinos: Portfolio Structuring Manager (Stanlib) million with Murray & Roberts
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“In this line of work you need to put your yourself in a position where you have interest and ownership of the projects you’re dealing with because structural engineering is a sensitive field in that we are dealing with peoples’ safety. We are putting up structures which are going to house lives so you can’t approach this profession as simply a job. You have to see it as a responsibility and a privilege.” - Tapa Moseki
>>> CONTINUED PAGE 04
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FNB’s CBD HQ – Intelligent Corporate Architecture by Kibo Ngowi
First National Bank (FNB) has moved into its newly built headquarters in Gaborone’s rapidly developing Cen Central Business District (CBD). Located in plot 54362, the Head Office called First Place, boasts the banks’ “one-stopshop” capability. With an expansion of
LEFT: Felix Chavaphi, MIDDLE: Tapa Moseki, RIGHT: Matlhodi Keaikitse
IDEAS EXPO BOTSWANA is an event designed to combine the best of creativity, business and technology in which participants are invited to give talks, do demonstrations, and show their work.
QUALITY PRODUCTS AND SERVICE FOR OVER 116 YEARS
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Buy or Build a new Home: The Pros and Cons
BOIDUS EXCLUSIVE >
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the office facilities accommodating all the Bank’s divisions such as Electronic Banking, Private Banking, Property Finance, WesBank, Firstcard to mention but a few, customers get a full bouquet of FNBB products under one roof. >>> CONTINUED PAGE 07
Birds-eye view
A Fresh Approach to Buiding a Home - Inside House Agolen II
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Office of the President
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As an architect, the opportunity to
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as being static. There is no other was buildrecently given exclusive tour of the construction site to experience ing typology that embodies such a nofirst hand tion of architecture than the house, the this exciting project as it most basic and primal form of shelter for human beings.
>>> CONTINUED PAGES 08, 13
The Relocation of the Office of The President Is it the Right Move Or Not? by HK Mokwete
The current debate in parliament over a budget allocation request of P195 million for the purposes of augment augmenting funds to either- acquire or build a new office block to house the Office of
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>>> CONTINUED PAGE 14
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homeFOCUS improvement P11 BOIDUS AUGUST 2015
BOIDUS FOCUS AUGUST HOME IMPROVEMENT P102015
DIY Projects - How to Install New Kitchen Cabinets - PART 1 [Source: www.diynetwork.com]
iNTRODUCTION
Before you start to install your kitchen cabinets, you should have removed the old kitchen, rerouted any utilities, and have the option to replace or finish the floor, if that is your plan. Always check that the entire cabinet order has arrived and is undamaged. Make sure that every item, right down to the screws, is checked off, because waiting for a second delivery can hold up the entire installation process. Installing a kitchen is a job for at least two people, especially when it comes to hanging large wall cabinets.
1. Planning and Preparation
Take time to prepare the wall surfaces and assemble the kitchen cabinets before installing them. Drawing the first guide line for positioning cabinets is essential to the success of the whole project. Cabinets and countertops are heavy items, and you will need someone to help you lift them into position.
Laying Out Cabinets • The starting point for installing any kitchen is a level guide line for the top of the base cabinets. A height of about 34-1/2” above the floor is standard. The countertop is added later. • Start in one corner, using a level to guide you. Older floors can be uneven, so check the line’s
height at intervals to make sure base cabinets and appliances will fit beneath it comfortably along the entire length. • Mark a second line to show the thickness of the countertop. Generally, wall cabinets are installed so that they are 19-1/2” from the top of the countertop, but adjust this height according to the manufacturer’s specifications for positioning cabinets around the stove. • If you are attaching wall cabinets to a stud wall, you will need to use a stud finder so you attach cabinets to studs, or provide additional support with extra blocking to ensure that fasteners are solid.
Preparing the Cabinets • Once you have marked up the wall surfaces, you should assemble the cabinets. Follow the manufacturer’s instructions for each type of cabinet. • Wall cabinets sometimes have installation rails across their backs that you cannot see once the cabinet is held up to the wall. Note their size and position so you can drill pilot holes directly through the inside of the cabinet once you have positioned it. Installing the Cabinets • Provided you have measured and marked accurately, installing the kitchen itself should be relatively straightforward. Follow your layout marks and attach cabinets to studs with screws. Predrill pilot holes and countersink screws beneath the surface. It may be easier to install upper cabinets first. • If you have a block wall, you can screw the cabinets directly to the wall with brackets. Drill and plug pilot holes in a masonry wall. It may be necessary to cut holes or notch cabinets to accommodate utilities. Wall cabinets will need to be positioned carefully, again, ensuring that they are securely screwed to the wall surface.
Sponsored by Sponsored by 4. Installing Cabinet Doors
2. Lay Out
• Use a tape measure to mark a point 34-1/2” above the floor level, for the top of the base cabinets (Image 1). • Use this mark to draw a horizontal guide line across the wall to indicate the top level of the base cabinets (Image 2). • Mark a point 19-1/2” plus countertop height above this line, and draw a line to mark the bottom of the wall cabinets. • Measure the width of each of your cabinets and mark their positions across the horizontal guide lines. Mark the location of each stud.
Replacing doors, drawers and handles can be a great way of updating a kitchen if changing the layout is unnecessary. If you are on a tight budget, you will be amazed how much the look of your kitchen can change with some paint and new hardware. You can paint almost any finish of kitchen cabinet, as well as tiles, but make sure you use the right paint and other materials — special primers will often be necessary. If you decide to change doors or drawers, make sure that the new ones are compatible with your existing cabinets. • Screw the hinge plate into its predrilled holes in the carcass. Hinge plates often come with the screws already inserted. • Insert the hinge into the precut recesses on the doors, and screw it in place. Be sure to use the correct short wood screws. • Position the door, with the hinges aligning with hinge plates, and use the screw already positioned in the hinge to join them. • Tighten the central screw in the hinge plate to secure the door. Follow the instructions below to align the doors perfectly.
3. Drilling Pilot Holes
For all cabinets that have attachment rails, drill a pilot hole through the rail into the cabinet. When you are ready to install the cabinet, you will have the necessary screw holes visible inside the cabinet. Pilot holes also help prevent the wood from splitting.
Next Month: How to Install New Kitchen Cabinets - PART 2 Aligning Doors, Attaching a Handle, Installing a Toekick, Putting on Drawer Fronts, Installing a Scribe Molding.
BOIDUS FOCUS AUGUST 2015
INTERNATIONAL NEWS P12
South African Construction
Sector Hits Hard Times (SA Commercial Prop News)
Energy projects and road infrastructure upgrades may offer some relief for South Africa’s beleaguered listed construction companies, but investors without a suitably long term horizon should probably think better of being seduced by the siren of attractive multiples. Heavy construction, whose fate is tied to government infrastructure roll-out and the mining industry’s capital expenditure, is in a deep funk. There are few new projects in the offing, pricing and margins are under pressure and a lack of available cash on balance sheets is restraining growth. Existing government spending has been negatively affected by cost overruns at Eskom’s Medupi, Sanral’s on-going woes and the necessity of managing South Africa’s twin deficits, among other issues. Mining companies, the performance of which underpins the country’s economy, are also under pressure as falling commodity prices and labour unrest have meant cost containment is the order of the day. In search of foreign contracts to fill order books, a host of South African construction companies headed up Africa or to Australia, but similar commodity price woes and competition meant these avenues provided little relief.
We don’t see this environment changing soon.”
looking fragile.
For investors in one of the smaller construction companies, the prospect of consolidation in a shrinking sector might seem appealing in anticipation of corporate action with a handy premium to market capitalisation, but Roodt said the lack of available cash likely meant payment through share issuances or mergers of equals. “We’ve seen some consolidation already and we expect to see more before the sector bottoms out.” He said the African growth story was not as strong as it was two years ago, and loss-making contracts there and in Australia had resulted in growth plans outside South Africa’s borders
One area that has looked positive by comparison is the home renovations and building supply market. “The local residential market is showing signs of looking better, linked back to stabilising house prices. Companies like Cashbuild at the lower end of the market will likely see margins stabilising, but it’s highly competitive and a lot of unlisted companies play in this space.” Roodt said Raubex had produced “decent” results based on on-going government spending on road infrastructure. Although it has underperformed the broader market, relative to its sector its flat share price — compared with the declining prices of its
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Vasilis Girasis, a trader at BP Bernstein Stockbrokers, said Esor stood out for share price movement, but the bigger players — the likes of Murray & Roberts and Aveng — remained under serious strain.
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Rhynhardt Roodt, portfolio manager of the Investec Equity Fund, agreed that it looked “too early to buy” for all but committed contrarians. “We’re still cautious and we hold no construction-related stocks in our equity or balanced funds, in the absence of a robust infrastructure cycle unfolding in the foreseeable future. Government coffers are currently empty for large-scale infrastructure projects.” Roodt said the pullback in mining infrastructure spending was what had caught a lot of investors off guard. “Order books looked healthy enough a couple of years ago, but have deteriorated rapidly, coinciding with the fall in commodity prices.
Sanlam Investment Management portfolio manager Michael Canterbury said that in the absence of post-World Cup government infrastructure spending as a catalyst, the state’s nuclear programme could boost prospects for heavy construction companies.
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“The smaller niche players, with much smaller overheads, smaller order books and better profit margins, like Esor, are doing quite well in a suppressed sector. And it looks like it will stay that way for a while. “If you’re looking for something to buy for the future, maybe Aveng could fill its order book quickly and move back up to R20 [currently R5.70] in no time, but if you don’t have two to three years to wait, I’d say steer clear of this sector.”
peers — since 2010 has massively outperformed. One clear area of opportunity, according to Roodt, is in Consolidated Infrastructure Group. “This is not a heavy construction play but has a clear African growth strategy in the power segment. It looks like a good niche in a service offering that other companies don’t really cover. It’s probably the only company from which I expect robust growth in this sector. It trades at a price to earnings ratio of 13 but has far better growth prospects.”
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BOIDUS FOCUS AUGUST 2015
GUEST COLUMNIST P13
The Effect of a condition Excluding community of Property in conveyancing documents By Akheel Jinabhai
of immovable property, as the imposition and registerability is restricted to a bequest or donation. Where immovable property is purchased with money or the proceeds of the sale of immovable property that has been excluded from the community of property, such newly acquired immovable property may be registered solely in the name of the spouse thus acquiring the property, provided the Registrar of Deeds can be provided with documentary evidence that the land was purchased from funds which are excluded from the joint estate. CANCELLATION OF CONDITION The condition can only be removed from the title deed by the beneficiary, who must apply to court for his benefit, alleging that there is no one besides himself interested in carrying out the directions of the will. A testamentary condition, excluding community of property in respect of immovable property and inserted into a deed when such immovable property is bequeathed or donated is a common occurrence, but is such a condition lawful and binding? To reach a determination, considerations of the common law, statutory provisions and case law will be applied. From a common law point of view Voet, a respected legal writer, says: “But if you declare that you make a gift or bequest to only one of the spouses, so that it shall not go into statutory community then in this case the law of donation is to be followed. For since the spouses themselves could have exempted their own property from community by means of a marriage agreement why should not the third party whose donation is quite voluntary be able to make it subject to this condition which is not essentially wrong, nor opposed to legal principles. And since a donor would have prevented his gift from going into a community of burdening it with a fideicommissum, surely there is no reason why he should not do the same by means of an unequivocal prohibition contained in the deed of gift itself. “ It is thus clear from the above that a testator may avoid his bequest from forming an asset in a joint estate in two ways: • •
Burden the land with a fideicommissum; Expressly exclude the inheritance from community of property.
The first method of burdening the land with a fideicommissum will not be discussed in this article but in our next issue where this concept will be expanded. The second part will be dealt
with below.
quired. A mere verbal agreement between the
The Botswana case of Khupe v Ntshwarang 2011 (1) BLR 484 (HC) brings out relevant principles for the second preposition. In this case a couple had divorced and the Plaintiff was seeking a share in the shareholding of one company. The Defendant argued that this was a donation and therefore didn’t form part of the joint estate. It is noted that this is not property but the principles that are raised can be applied to property as well.
alleged donor and donee cannot create a condition that defeats a right bestowed by law such as the one flowing from community of property.
The case states that the legal effect of the community of property regime entails the pooling of all assets and liabilities of the spouses immediately upon the marriage into one common estate of co-ownership in equal and undivided shares. This pooling of assets operates automatically and by operation of law immediately upon marriage. There are a few exceptions to this general rule, for instance, where exclusion is by statute, see The Abolition of Marital Powers Act (Cap 29:07) section 6 (b) which states that the property be excluded from community of property by virtue of a condition in a bequest. It goes on to say that there was no evidence that the claimed donation had a condition in a form recognised by law excluding it from community of property. If such donation preceded the marriage it would have required, to create rights against his future wife, to be registered in the Deeds Registry or to be registered as an antenuptial contract by virtue of section 4 of the Antenuptial Contracts Act (Cap 29:02) as read with Part VII of the Deeds Registry Act (Cap 33:02). Where as in this case, the donation was after the marriage, a registered notarial deed of donation would have been the very least re-
In dealing with issues relating to donations, the court stated that the party who claims to own property by virtue of a donation where there is a dispute, to be forthcoming as to the nature of the alleged donation. The law draws a distinction between a pure donation which rests solely on the donor’s generosity (donatio mera), and, reciprocal and renumeratory donations (donatio non mera). An essential element of a donation is that the estate of the donor must be impoverished and that of the donee correspondingly enriched. Where the estate of the donor is not impoverished or the estate of the donee enriched, the transaction will not constitute a donation. The Deeds Registry Act also tries to give clarity to this position at section 18 subsection 4 which states that Immovable property bequeathed or donated to a person married in community of property may be transferred or ceded to that person and shall not form part of the joint estate where, by a condition of the bequest or donation it is excluded from the community of property. The case of Bosman v Richter 1853 6 C (2 Searle) 78 also provides that “A testator may validly institute as heir or make a bequest to a woman who is married in community of property on such terms that the inherited or bequeathed property is free from the husband’s control” The common law does, however, not allow for a similar condition to be imposed on the sale
EFFECT OF CONDITION ON SEPARATE ESTATES OF SPOUSES MARRIED IN COMMUNITY OF PROPERTY It was the common belief of testators and donors that immovable property bequeathed or donated subject to a condition that the property will not form an asset in a joint estate, will be excluded from the community of property and is protected, should the spouse of the donee or heir subsequently be sequestrated. The judgement in Du Plessis v Pienaar NO and Others 2003 (1) SA 671 (SCA) has overruled this belief. The condition in question is relevant only for the purposes of the relationship between the spouses themselves (inter partes). The court held that each spouse’s estate comprises not only his undivided interest in the joint estate, but also his separate property falling outside of the joint estate. It is thus clear from the above decision that assets owned separately from the joint estate also form part of the joint insolvent estate. CONCLUSION From the above it is evident that the condition in question is registerable, but the relevance thereof is limited to the parties inter partes only. The common belief that such assets are protected against future creditors of the joint estate no longer prevails. The above is meant only as a brief on the effect of a Condition Excluding Community of Property in Conveyancing Documents. The information given is general and is not intended as legal advice. Akheel Jinabhai is the Managing Director of Akheel Jinabhai and Associates.
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BOIDUS FOCUS AUGUST 2015
FEATURE P14
Financial Inclusion & the Botswana Property Market By Kibo Ngowi
are some of the key facts the survey uncovered. Boidus Focus spoke to Real Estate Institute of Botswana (REIB) President Modiredi Maruping to find out his take on the alarming figures.
BF:
Based on the recent survey data by FinScope, showing that around 90 percent of working Batswana earn less than 10k, how do you see this affecting the growth of the overall property market in Botswana?
MM:
The performance of the property market has been impressive. It has just recently slowed down and IPD in its recent report indicated a halving of returns. Even property practitioners have expressed the same sentiments of low rentals and low capital values. That Batswana earn low has been the case for quite some time. It’s just that now it is been backed and confirmed by survey. Working Batswana have been on the sidelines and continue to be. The situation has deteriorated because due to a slowing down of the property market, financial institutions have taken necessary steps and tightened lending. This is where the immediate issue is as it means more and more Batswana cannot access mortgages.
FinScope Consumer surveys have been implemented in South Africa since 2002 and conducted in 21 countries (12 in SADC, 5 in non-SADC Africa and 4 in Asia).
Non-Bank Financial Institutions Regulatory Authority, FinMark Trust and Consumer Watchdog Botswana. The research house participated in the SC meetings.
A Steering Committee chaired by the Bankers Association of Botswana was set up which comprised representatives from the Bankers Association of Botswana (co-funder), Statistics Botswana, Ministry of Finance and Development Planning,
1,503 face-to-face interviews were conducted by DCDM Economic & Management Consultants (between October and December 2014) with a nationally representative individual-based sample of Batswana aged 18 years and older. Below
BF: What is the sustainability of the market in the long-term if this income data remains the same?
MM:
The market will take care of itself. When house prices are high and the market cannot sustain them, the natural thing happens, prices start to drop. When prices drop the expectation is that more people will then be able to participate. The more they participate the more confidence returns and demand out-paces supply and prices start rising again. The cycle continues. The question should be about Batswana themselves and their earning capacity. If you have less and less Batswana participating in the real estate market it will fuel discontent in the country. This may, for example, lead to a legislative environment where lawmakers then try to correct the situation by introducing protective legislation such as that completely prohibiting sale of land to foreigners. This discontent may also lead to the public starting to think that Government can regulate property prices and actually forcing government to start thinking the same.
BF: The data suggests that the majority of income earners are outside the affordability range of current mortgage products. How can the majority of income earners access funding to buy or build property?
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Event Feature: State of our CitiesBDC FAIRSCAPE PRECINCT, The rising engineers Felix Chavaphi, founder of Norcon Group; Tapa Moseki, partner at Engineering CBD Executive Seminar Event Partners International; Matlhodi Keaikitse, partner at Ezra’s Contracting Services Realm of Splendor - Live, Work & Play With Breath taking Views BOIDUS EXCLUSIVE FEATURE >
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by Kibo Ngowi Bringing together key CBD stakeholders such as landowners and develop ers to engage on issues that affect their developments and investment
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BR Properties - Botswana’s first Parastatal Property Investment Subsidiary
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“Public Piazza, Mixed Use Podium and Sky gardens coming to Gaborone”
by Kibo Ngowi & HK Mokwete
by Kibo Ngowi & HK Mokwete
by Kibo Ngowi
BR Properties is a pioneer organisation as it is the first example of a
company established to commercially exploit the real estate assets of a Botswana Government enterprise. The performance of this company will serve as a test case for many other
by Kibo Ngowi / H. Killion Mokwete
departments with ambitions of creating similar entities. Boidus Focus met
with BR Properties Managing Director Oarabile Zhikhwa to explore the brief history and long-term ambitions of her organisation. >>> CONTINUED PAGE 05
>>> CONTINUED PAGE 07
LEFT: Felix Chavaphi, MIDDLE: Tapa Moseki, RIGHT: Matlhodi Keaikitse
“I would say that as an engineer, especially in the construction field, experience is crucial, which is why firms tend to only hire engineers with a high amount of experience for senior project roles. And that’s understandable to me, because as much as you can go to school and read books, there’s no substitute for actually being involved in a project...” - Matlhodi Keaikitse
Top: Guests and delegates at the CBD Event Bottom: Architect and Urban Designer Jo Noero from Noero Architects and University of Cape Town Right: Hon. Assistant Minister of Trade and Industry, Keletso J. Rakhudu, officially opening the event
The Boidus Media, State of our Cities-
and the public in sharing of ideas and
CBD Executive Seminar recently held at Masa Centre was by any measure
opportunities about our upcoming CBD. Envisaged as the future heart of
a resounding success. The Seminar event brought together for the first
Gaborone City, the CBD is slowly taktak ing shape and the seminar sought to
time ever in Botswana, key stakeholders of the New CBD development
make it a centre stage focus of discusdiscus sions and professional deliberations.
such as investors, development owners, government, industry champions
In this Boidus Focus Special, find event abstracts:
As you reflect on the ‘challenges and opportunities’ of developing a CBD, I would like to encourage all of you to think of this as what our generation will be remembered for having done, not only for this City, but for the nation, albeit through the toughest times. Assistant Min. of Trade & Industry, Hon. Keletso J. Rakhudu
by Boidus Admin
A Successful CBD represents among other things; • A success CBD Image of the city and the country Felix Chavaphi Portfolio • Generation of the country’s prosperity • Successful partnership between the Government & PVT[TOP] sector University of Botswana Library Dimitri Kokinos: Portfolio Structuring Manager (Stanlib) million with Murray & Roberts
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“In this line of work you need to put your yourself in a position where you have interest and ownership of the projects you’re dealing with because structural engineering is a sensitive field in that we are dealing with peoples’ safety. We are putting up structures which are going to house lives so you can’t approach this profession as simply a job. You have to see it as a responsibility and a privilege.” - Tapa Moseki >>> CONTINUED PAGE 04 >>> CONTINUED PAGES 03, 04, & 06
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FNB’s CBD HQ – Intelligent Corporate Architecture by Kibo Ngowi
First National Bank (FNB) has moved into its newly built headquarters in Gaborone’s rapidly developing Cen Central Business District (CBD). Located in
the office facilities accommodating all the Bank’s divisions such as Electronic Banking, Private Banking, Property Finance, WesBank, Firstcard to mention
plot 54362, the Head Office called First
but a few, customers get a full bouquet
Place, boasts the banks’ “one-stopshop” capability. With an expansion of
of FNBB products under one roof. >>> CONTINUED PAGE 07
Birds-eye view
A Fresh Approach to Buiding a Home - Inside House Agolen II
by Leago Public Piazza
Office of the President
Sebina
As an architect, the opportunity to design a building offers, not only the creation of a physical expression of the building itself, but also the possibility for architecture to mould the life and memories of its inhabitants. Therefore, one could argue that architecture should be thought of as being alive as
opposed to the way it is usually viewed, views from across the City. Boidus as being static. There is no other was buildrecently given exclusive tour of the construction site to experience ing typology that embodies such a nofirst hand tion of architecture than the house, the this exciting project as it most basic and primal form of shelter for human beings. >>> CONTINUED PAGES 08, 13
>>> CONTINUED PAGE 14
The Relocation of the Office of The President Is it the Right Move Or Not? by HK Mokwete
The current debate in parliament over
the President (OP) is missing the big-
a budget allocation request of P195
ger picture of what should be debated
million for the purposes of augment augmenting funds to either- acquire or build a
when procuring the office space for the ‘Highest Office in the Land.’
new office block to house the Office of
>>> CONTINUED PAGE 04
CBD EXECUTIVE SEMINAR - Oct 2014 CBD EXECUTIVE SEMINAR - May 2013 DESIGNER’S FORUM - Apr 2012 BOTSWANA PROPERTY MARKET - Coming Feb 2015 BOTSWANA PROPERTY MARKET - Sep 2013 HOUSING AFFORDABILITY IN BOTSWANA - Mar 2012 FNBB AFFORDABLE HOUSING MARKET - Dec 2013
MM:
Firstly, the same mortgage products are designed from outside Botswana. They do not take account of our situation here. Financial Institutions should bring home their product development units so that they can consume firsthand information and develop relevant products. Batswana will otherwise remain outside. Products have to be developed that are relevant to Batswana today.
BF: Property prices, especially housing, have been rising over the past few years. How do the statistics on financial inclusion presented in this report reflect on this rise in property prices? MM: It does not make sense that property pric-
es still continued to rise in this environment. But it could be the case that with the limited number of working Batswana that can participate in the real estate market this is as much as they can do. This is as much as they can grow the market. Therefore the structure (i.e. increases in salaries/ focused financial products etc.) must change to allow for further inclusion and spur growth.
BF: If most Batswana can't afford to buy property, then what has informed the rise in property prices? MM: Then rise in property prices is
not determined by availability of finance/access to finance alone. Simply put; demand and supply. Lack of serviced land has put pressure on prices of available land. The simple example would be recent stampedes at land boards for application of residential plots. One assumes these are Batswana who are ready to develop. The same Batswana would be ready to pay for a piece of land if the Land Board does not provide one. They will even out-bid each other for it. Batswana are now more educated about land and appreciate its value. They therefore demand what they think is adequate compensation to be dispossessed whether voluntarily or not.
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BOIDUS FOCUS AUGUST 2015
REpORT P15
Mortgage Lending Rises While The Majority Remain Excluded Below is an excerpt from a special feature on ‘Housing Finance in Botswana’ which recently appeared in the Econsult Economic Review of 2015 2nd quarter (April-June) According to the 2009/10 Botswana Core Welfare Indicators Survey (BCWIS) and the 2011 Population and Housing Census (PHC), there are approximately 550,000 households in Botswana. Mortgage lending in Botswana is mainly provided by the commercial banks and the Botswana Building Society (BBS), and has been growing rapidly in recent years – passing P10 billion in 2014, compared to less than P5 billion at the end of 2010. Property lending to households has grown by 21% a year over the past decade, and has been an important contributor to overall credit growth. Despite this growth, mortgage lending in Botswana is relatively small.
We estimate the total number of mortgages at around 15,000, which means that only around 3% of houses are financed by a mortgage yet mortgage finance accounts for just over 30% of bank lending to households. The number of mortgages isDEFY lowKITCHENAIRE compared to the number of people in for621 mal employment P 3799.95 (340,000). Mortgage finance accounts for just over 30% of bank lending to house4 BURNER holds. Relative to otherDEFY upper-middle income GAS STOVE countries in Southern Africa, the ratio of mortgage P 1999.95 DEFY CF530 finance to GDP in Botswana is low: South Africa CHEST FREEZER (22.0%); Namibia (18.2%); Mauritius (13%); BoP 4999.95 tswana (6.6%); Zimbabwe (2.8%); Zambia (1.3%).
room by room. Currently, such housing microfinance is not available in Botswana.
While the government schemes make a useful contribution to alleviating housing affordability constraints, they only cater for a lucky few. It might be more productive, in the longer term, to use those resources – in an appropriate policy framework – to support the development of alternative housing financing mechanisms that could have a broader and more equitable impact, and be more sustainable.
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Based on recent household surveys, From Molepololewe estimate Robot Lights that half of Botswana households have a monthly income of P2,000 or less, and a quarter are in the range of P2,000 to P4,000. None of these households would qualify for a mortgage loan large for the purchase of a completed modern T, COME enough AND SEE FOR YOURSELF” house. Even at the upper end of this range, an income of P4,000 would only qualify for a mortgage of around P150,000.
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It is therefore apparent that the size of affordable housing mortgage loans for most households is totally out of line with the price of housing in the market. The binding constraint on the provision of housing finance through mortgages is not the availability of funds, but the availability of effective demand. In turn the lack of effective demand is the mismatch between income levels and housing prices. POSSIBLE SOLUTIONS Perhaps there is a role for housing loans built around microfinance principles – small loans, unsecured or with alternative collateral, relatively short-term, with mandatory prior savings, where the successful servicing and repayment of one loan unlocks access to another, larger loan. Such financing is well suited to the construction of small-scale housing, or incremental construction,
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PROFESSIONAL PRACTICE P16
A four Part series:
A Tactical Guide to Avoiding
Construction Contract Disputes By Boidus Admin
Administering building/construction contracts is a complex process and as such contractors, building consultants and clients should make time to understand the details in the contracts that might have potential for inevitable disputes that are bound to happen. Boidus Focus features a four part series which will explore key areas that have high potential for disputes. This by no means is an exhaustive list but an indicator to potential general problem areas. Contractors should seek professional advice to review their project specific contracts for any potential for disputes.
Part 1 - Understanding Performance and Design Specifications in Contract administration The contract specifications will often instruct the contractor to do more than simply build a particular building element using certain materials. While sometimes the specifications will simply instruct the contractor to build an element in a particular fashion, other times the specifications will instruct the contractor
to construct a building element in a manner that achieves certain objectives. The difference between these two types of specification is important because it dictates the level of risk a contractor is assuming. A performance specification sets forth the standard of performance to be achieved. The contractor is expected to exercise his judgment in how best to achieve the performance standard. A basic example of a performance specification is if a specification states that the contractor shall construct a HVAC system that shall maintain a certain level of temperature and humidity, but leaves the design of the system necessary to achieve the required temperature and humidity levels up to the contractor performing the work. Conversely, a design specification describes in detail the materials and equipment the contractor must use and the manner in which the work must be performed. As one court put it, “design specifications state how the contract is to be performed and permit no deviations. Performance specifications, on the other hand, specify the results to be obtained, and leave it to the contractor to determine how to achieve those results.” This distinction is critical because when a contractor agrees to design a system to meet a performance specification it warrants that the system will perform as promised. Conversely, a contractor that designs a system simply to meet the design specification guidelines makes no warranty that the system will perform in any particular way. In fact, under the so called Spearin Doctrine, which gets its name from a 1918 Supreme Court decision United States v. Spearin, a contractor who has constructed a system according to a design specification has a defense to any claim that the system is not performing as intended. The Spearin Doctrine applies only to design specifications. Often, determining whether a specification is a performance versus design specification is difficult as a specification may blend elements of both. In order to differentiate between performance versus design specifications, courts look to the level of discretion that exists within the given specification. A contractor arguing that a specification is a design specification – and thus subject to the Spearin Doctrine – must show that the specification “does not permit meaningful discretion.” Specifying a certain manufacturer of a product alone is not dispositive of whether a specification is design rather than performance, especially when a specification permits substitution of a specified product with “an approved equal.” In determining whether a specification is design over performance, courts also look to how much oversight the owner exercised over the contraction work and whether the specifications lay out the contractionmeans and methods of contraction. Additionally, the difference between design and performance specification and the liabilities each creates is of particular importance to design builders because specifications in designbuild contracts are performance specifications. Therefore, design-build contractors should not only confirm that the system is capable of being constructed to perform as required, but also that it can be constructed at a price acceptable to the design-build contractor. A design-build contractor that learns after contracting that although the system is capable of construction, albeit at an exorbitant price, will not be entitled to an adjustment in the contract price. Moreover, if they are financially incapable of constructing the system at the price necessary for it to perform, it is at risk for a bond claim.
BOIDUS FOCUS AUGUST 2015
ADvERTISING P17
MOESD, New Era College
Focus on Scarce Skills By Peggy Dipheko
The importance of focusing on scare skills in order to foster entrepreneurship is becoming increasingly evident in the present state of unemployment and economic downturn. The Ministry of Education, Skills and Development (MoESD) is now retooling universities, sacrificing arts programs, in collaboration with a business community eager for better skilled graduates.
institutions such as Madirelo Training and Testing Centre in order to gain from the experience these institutions have in this area. Furthermore, the Ministry of Trade and Industry has partnered with the Ministry of Youth, Sports and Culture to develop youth for self employment and form clusters for business where they develop and employ themselves.
In partnership with New Era College of Arts, Science and Technology the ministry has decided to ease restriction on entry points for college acceptance to cater for students who did not qualify for further education and government sponsorship. The government is currently covering 36 points and above for students to be sponsored by the government but with this new program the government will allow students scoring below this threshold to enter college and develop skills.
Didimalang added that it is good for government to educate people but it is important not to just educate people for formal employment but for entrepreneurship, which empowers individuals to employ themselves and others.
“The Ministry of Education has taken this initiative to go below cut off points in favour of the Junior Certificates and O-level students who did not access college to develop scares skills as artisans,” New Era College Director for Academic Affairs Mr. Clement Didimalang told Boidus Focus in an exclusive interview. “The program covers courses such as Construction Industry; Telecommunications and Systems; and Electrical and Electronic Engineering; which will help students to gain hands-on experience and ultimately be able to employ themselves.”
According to Didimalang, the program will take two and a half years to complete and while it is a youth empowerment program it will still follow the college regulations and ministry laws. For the two years that the course will be running, one year will be for theory and the second year will be more on practical assignments. Similar to other programs, students will go for internships after they complete their studies, before they graduate. He said as a norm, proper selection processes will be followed, but they will not necessarily be conducted to reject people. “We have a wide range of programmes; there are alternative short programmes in case if we feel there are those who cannot cope with the more advanced courses,” says Didimalang. “If we feel they cannot excel at the courses offered, we will not allow them to do the courses because if they fail it means New Era has failed and the that the country has failed.” New Era plans to accept the first intake in September this year but negotiations on whether these students will receive a monthly allowance are still on-going. “The intention of this project is to increase scares skills, develop independence and reduce unemployment rates. There is a lot of dependency on foreigners, especially in the mines,” says Mr. Didimalang. He further said that up-skilling the students they are targeting will help put a dent in the high youth unemployment rates Botswana is currently experiencing. New Era College has also partnered with Brigades
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BOIDUS FOCUS AUGUST 2015
EDITOR’S NOTE P18
EdiTORs NOTE
COMPREHENSIVE, INTEGRATED AND AUTHENTIC SOLUTIONS NEEDED IN THE QUEST FOR AFFORDABLE HOUSING By H. Killion Mokwete, RIBA Chartered Architect
Recent survey data indicates that some 90% of Botswana’s income earners make less than P10, 000 per month, an income range which leaves them unable to afford a mortgage loan, as most mortgage loans range from P500, 000 upwards. Thus, affordable housing remains a pipe dream for the majority of people in this country. The high cost of mortgage loans, building materials and skilled labour, along with the limited supply of serviced land, have conspired to make the dream of owning a home an illusion for most Batswana. The need for creative solutions to address this country’s affordable housing problem is at crisis levels. Deliberate steps to reduce the cost of construction need to be undertaken and this needs to be approached as an integrated process rather than as a piece-meal endeavour. This means that all stakeholders involved in housing delivery, including developers, local authorities, government ministries, building materials suppliers and mortgage providers need to come together to develop sustainable solutions to the high cost of housing. Currently, efforts being made by parastatals such as BIH, BHC and BITRI are commendable but are still too little, disjointed and lacking grounding principles in how exactly it is that they will reduce the cost of housing. More importantly, efforts such as those be-
ing undertaken by BIH in partnership with a Swedish outfit to develop sustainable housing (featured in this issue) still puzzle me. Why does BIH have to go to Sweden to look for affordable housing solutions for Botswana rather than engaging domestic institutions such as UB and BIUST or local professionals? I’m not insinuating that international research entities cannot offer better solutions, but rather that I would like to see an effort made to develop integrated, home-grown solutions that would have the added benefit of boosting the performance of our economy through increased skill and commercial activity. At the very least, these international research outfits need to find local partners who can help them appreciate the cultural housing context and navigate it appropriately. Moreover, this should ensure that there is a deliberate transfer of knowledge and skills to local professionals. I cannot overstate the importance of developing creative solutions to housing affordability that are sensitive to the local environment, culture and ways of living. Although prefabricated technology strategies have produced successful housing solutions elsewhere, appropriate application to the Botswana environment needs to be investigated. Otherwise, such houses risk stigma and rejection by the users. Examples of such failed experiments in the post-World War II housing developments of Europe are there to remind us of these pitfalls.
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ADVERTISING P19
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ADvERTISING P20
BOIDUS FOCUS AUGUST 2015
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