Botswana eyes $17bn US fund

Lewanika Timothy | Monday May 20, 2024 06:00

Speaking to BusinessWeek during the recently ended US-Africa Business Summit held in Dallas, Texas, a highly placed MCC insider said Botswana has applied to be a beneficiary of the MCC, as part of efforts to revive barren sectors and state-owned entities.

Botswana’s application comes as the country doubles down on selling its story as an investment hub for international financiers and corporations.

“I can confirm that Botswana’s application has been received by the Millennium Challenge Corporation and it’s nearing approval,” the insider told BusinessWeek. “The consideration criteria are quite robust. “The main things MCC looks at are issues of commitment to democracy, good governance and a track record of using country-specific investments wisely.”

Founded by the US Congress in 2004, the MCC provides time-limited grants promoting economic growth, reducing poverty, and strengthening institutions. The organisation’s primary investments target economic stability investments that spur prosperity in partner countries while furthering American interests. The main donors to the fund are American taxpayers.

The insider further stated that Botswana’s push for dollar-based investment will be helped by the country’s stable politics and macroeconomic policy.

Meanwhile, speaking at the opening ceremony of the US-Africa Business Summit MCC CEO, Alice Albright, said the organisation was seeking to advance to more African countries as the continent continues to offer strong signs of economic opportunity.

She, however, mentioned that MCC has had to pull out of some African countries due to deteriorating political climate as seen in military coups and unfair elections.

“While we want to take more ground in Africa, the political climate has been hostile with acute regressions as noted in a recent wave of military coups and lack of regard for the rule of law,” she said.

Finance Minister Peggy Serame plans to finance this year’s P8.7 billion deficit through the domestic capital market while allowing government’s reserves to recover from their COVID-19 weakness.

MCC provides large, multi-year grants to eligible governments for sectors such as electricity, health, education and infrastructure.