Air Botswana, NDB line up for recapitalisation
Lewanika Timothy | Monday February 12, 2024 06:00
Figures from the Ministry of Finance’s draft budget estimates published on Tuesday show that Air Botswana, the country’s troubled national airline, is scheduled to receive a bailout of P121 million in the 2024-2025 financial year. This follows an allocation of P166 million in the current year, also for a bailout.
The funding is part of the ongoing government rescue missions for the airline, which has faced decades of unprofitability exacerbated by the global travel bans resulting from the COVID-19 pandemic. Delivering the budget speech on Monday, Finance Minister Peggy Serame stated that most of the funds allocated to the struggling airline would go towards infrastructure improvements and maintenance. “The air projects to be catered for include maintenance of airports, improvement of surveillance of Botswana airspace, upgrading of air navigation services infrastructure, installation and improvement of airport security systems, mandatory engines replacement, procurement of airport safety equipment as well as improvement of existing airport security and safety,” she said. Air Botswana’s development funding in the Transitional National Development Plan has been revised to P702.7 million over the two years of the plan, from an initial allocation of P133.6 million. Meanwhile, the NDB will receive at least P500 million in the coming financial year for its recapitalisation. However, unlike Air Botswana, the additional funding is to support NDB’s transformation into a commercial agricultural bank as envisioned by the Temo Letlotlo inputs programme.
The NDB is playing the role of the financial intermediary in the Temo Letlotlo programme, providing government-backed credit to various categories of farmers.
“The lending component (of Temo Letlotlo) is being administered by the NDB, which started in the 2023-2024 ploughing season, while the insurance component will be transferred to the private sector during the 2024-2025 financial year,” Serame said.
The extra funds for NDB will come from diverting funds initially purposed for use within the Ministry of Finance and in the Ministry of Education and Skills Development.