Loans to vary from P500 to P50 million
In an effort to support government’s Cooperative Transformation Strategy, Citizen Entrepreneurial Development Agency (CEDA) recently launched its Cooperatives Product.
The product is aimed at financing equipment, plant, asset acquisition, property development and working capital needs, with loan amounts starting from as little as P500 and rising to P50 million.
Briefly outlining some of the requirements needed to secure such a loan, CEDA Chief Executive Officer (CEO), Thabo Thamane, stated “As a rule, all projects financed by CEDA shall be secured to the satisfaction of the Agency as per the Revised Guidelines.
“The Agency may require up to 100 percent security cover depending on the viability of the project and risk appetite of the Agency from time to time.”
In line with the recently revised CEDA guidelines, Thamane revealed priority will be given to cooperatives operating in ‘special’ sectors such as: manufacturing, mining, construction, energy, technology and innovations, agriculture, creative industry and tourism.
Speaking at the launch, the CEDA boss took members of the media on a short trip down memory lane.
He noted that in the past, government has attempted, unsuccessfully, to support cooperatives through initiatives such as the Public Debt Service Fund and the Revolving Trust Fund, which was administered by Botswana Cooperative Association (BOCA).
“However, these were not effectively utilized therefore were not sustainable. In an effort to create a sustainable product that supports the government’s transformative strategy, the Agency invested in research and extensive stakeholder engagement during the creation of this product,” explained the CEO, adding this included engaging a Kenya-based consulting firm, KUSCCO, to assist in product development.
Meanwhile, Minister of Investment, Trade, and Industry, Mmusi Kgafela noted the launch was a culmination of efforts to introduce a product that addresses the challenges faced by cooperatives in the country.
“Cooperatives in Botswana can trace their roots to the colonial era and have seen several attempts to entrench and enhance their contribution to the economy as well as improve their sustainability,” reflected the Trade Minister.
Kgafela added it is evident that while cooperatives have operated in Botswana for many years, their economic impact is mixed.
“While many of them are successful, there are equally many others which are less successful,” he admitted ruefully.
Highlighting the purpose behind govt’s now decade old Cooperative Transformation Strategy, Kgafela explained the idea was to develop new generation cooperatives based on modern business practices.
“Government developed the Cooperative Transformation Strategy for Botswana in 2011, to resuscitate, revamp and re-direct the development of cooperatives into globally competitive businesses with a human face,” he declared.