DUMA FM INTERVIEW
Gaborone, June 9, 2015
1. Relations between Russia and Botswana in general
Botswana and the Soviet Union established diplomatic relations on March 6, 1970, that is only four years after independence. The Russian Embassy was opened in Gaborone in 1976. The 45th anniversary of diplomatic relations was recently celebrated in Gaborone. Our Embassy organized a photo exhibition and a concert by Russian musicians devoted to this historical landmark.
Botswana-Russia relations are traditionally friendly. Positions of both countries on main international or regional issues are close or coincide. We have a number of areas of cooperation, some of which, however, are yet to be developed.
Unfortunately, there is no Botswana Embassy in Russia. The Ambassador accredited in the Russian Federation permanently resides in Stockholm, Sweden. But we hope that the permanent diplomatic mission will be opened in Moscow in the foreseeable future.
Russia actively assists in training Botswana specialists, including such areas as law-enforcement, health and education. The pace of expanding public ties in the area of education creates incentives for more Botswana students to study in Russia on a self-sponsored basis. Russian universities are gradually becoming more attractive for Botswana youth in terms of affordability and quality.
Besides we can see that over the past few decades bilateral business cooperation has come to stay, which shows that Botswana and Russia objectively have common interests and this is not a mere political declaration.
At present we have eight bilateral documents, including the Trade Agreement of 1987 and the Agreement on Technical and Economic Cooperation of 1988. There is also a separate intergovernmental Agreement on Cultural, Scientific and Educational cooperation of 1999, Protocol on Political Consultations of 2002.
2. How the 2 countries have created opportunities for each other for development of both countries, especially business development.
As was said, the main contribution of Russia to Botswana’s development lies in the field of academic training.
Every year several Botswana students are sent to Russian institutions of higher education within the quota of the Government of the Russian Federation, which completely finances their studies. Taking into consideration high demand for qualified teachers in Botswana, plans are underway to resume practice of inviting Russian academics to Botswana Universities to teach various disciplines.
Skills development programs for Botswana medical doctors are regularly conducted in Russia. Three groups of medical specialists are going to visit Russia this year to participate in professional seminars and conferences carried out within the framework of the Muskoka initiative on Maternal, Child and Newborn Health launched at the G 8 summit in 2010.
There are special programs for the workers of Botswana law-enforcement agencies: every year about ten police officers undergo short-term upgrading courses in specialized educational institutions of Russia. Besides, several policemen are studying in Russian police universities on a permanent basis to obtain a degree in forensic expertise.
As for the business development, we deem important to focus on ways to strengthen mutually beneficial cooperation in the area of trade and economy. A deal of experience has been accumulated during operation of the Russian mining company “Norilsk Nickel” in Botswana since 2007. However, we have other major mining companies, which could establish mutually beneficial ties with partners in Botswana, such as ALROSA, Renova, Evraz, Gazprombank Global resources.
In 2010-2011 negotiations between the Russian Chamber of Commerce and Industry and the Botswana Export Development and Investment Authority (BEDIA) were held. In December, 2011 the delegation of BEDIA took part in the business forum “Russia-Affrica” in Addis-Ababa, Ethiopia. In July, 2013 the Botswana delegation attended the Russia-Africa Economic Forum “Ural-Africa” in Ekaterinburg.
In cooperation with BITC we are now preparing a visit by Russian business mission to Botswana later this year. The idea of this forum is to familiarize Russian entrepreneurs with investment opportunities in Botswana and help establish direct links between Russian and local businesses.
Finally, we intend to include your country into the governmental program “New Generation” so that young Batswana could make trips to Russia, where they will familiarize themselves with our best practices, system of central and regional governance, education and developmental projects.
3. The available markets in Russia which Botswana Entrepreneurs and private sector can tap into.
Russia and Botswana being two major players of the rough diamond market possess all key ingredients to glue a partnership. For example, Russia’s Kristall Production Corporation – a major integrated polishing and jewelry enterprise – could offer its unique experience in polishing technology and manufacture of jewelry. And it already does since Kristall participates in De Beers Global Sightholders Sales in Gaborone, and recently they extended their contract for another three-year period.
Probably, Botswana meat producers could open up the Russian market, given that Russia has to import a substantial share of beef it consumes. If Botswana beef corresponds to all sanitary and food safety norms and standards and if such trade proves economically viable, I think Russia may well buy high-quality Botswana meet.
Besides, our countries each boast rich wildlife and nature, possess well-established tourism industry. Together we can explore ways of forging direct links to develop mutually beneficial cooperation in these areas. The kinds of wildlife we protect may differ – for Botswana it is the Big Five, while for Russia – it is Amur tiger, Caucasian and Far Eastern leopards and Polar bears. However, we are ready to cooperate and assist each other in that regard. Russian representatives took part in both London and Kasane conferences on the Illegal Wildlife Trade and put their signatures under respective declarations.
4. Examining the Botswana business environment and how different it is from the country in representation, what Botswana can benchmark with regards to the business dealings/environment which can improve business development in the country.
Over the period of independence Botswana has made great strides in terms of social and economic progress reaching the status of an upper middle-income country. However there are still serious challenges that drag the development of the country behind.
The weak educational base is a problem intrinsic to most African countries. This is why the Russian Federation attaches considerable importance to training qualified professionals, including those from Botswana. I know that a considerable number of children in this country do not finish secondary school and far fewer receive higher education. I am also aware of a shortage of university teachers, especially in some areas such as medicine. Botswana government is making serious effort to raise the level of education, which is revealed, for instance, in a recently released Education and Training Sector Strategic Plan for 2015-2020. Hopefully, Botswana will manage to increase productivity and competitiveness and eventually join the ranks of the developed states.
Botswana is undertaking several initiatives to ameliorate its business environment and to make the conditions of business activities more favourable. The creation of special economic zones can largely contribute to attracting foreign direct investments. In Russia we have a most positive decade-long experience of special economic zones: they are especially instrumental in developing regional economy and creating jobs for local population. Special regime for newly opened businesses is also efficient: tax emissions, accessible credits, facilitated administrative procedures, etc. are powerful incentives to boost the growth of small and medium sized enterprises. In our country, these measures are also employed.
By the way, the Russian market has two main advantages: firstly, its size (the population of Russia is 144 mln. people) and secondly, the rate of profit. Generally it is higher than even in South-East Asia.
5. Examining the current law or policies in Botswana with regards to trade, how it limits or provides opportunities for Botswana to tap into global markets, and which laws to be strengthened or availed to allow the Botswana business environment to tap more into global opportunities as well as allowing exchange between the two countries.
As we know, Botswana became one of the founding Members of the WTO in 1995. Russia has also recently joined the WTO after almost twenty years of negotiations.
Botswana has been actively participating in trade liberalisation both in regional and global context. Being a relatively small economy itself, Botswana is a part of a huge SADC Free Trade Area. All these developments show that the Government puts a premium on broadening international commercial ties and deeper integration into the world economy.
I am not an expert in Botswana trade law, but I am aware that the country’s policies and regulations are in line with internationally accepted practice and SADC agreements. Meanwhile, the government avoids excessive liberalization of the domestic market. For example, in a recently negotiated Economic Partnership Agreement with the European Union Botswana retained a number of protective measures it can apply for the benefit of domestic producers.
As far as our bilateral relations are concerned, we have the Trade Agreement signed back in 1987 and the Convention for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income signed in 2003. Currently discussions are on-going on a draft agreement on mutual protection of investments. At the same time the volume of trade between Botswana and Russia is rather small. Generally Russia supplies to Botswana industrial equipment, TV cameras and other devices. We definitely should work together to fully realize the potential of trade between the two countries.
6. Information on any projects/ researches/ collaboration done by the 2 countries and analyzing its benefits.
• Russian JSC ALROSA is a global leader in rough diamond production. It boasts the largest resource base in the world. Against the background of the projected shortage of rough diamonds in the global market, ALROSA considers maintaining high production volumes and search for new diamond deposits its key objectives. The company has already been prospecting for Botswana diamonds in a joint venture with British «Botswana Diamonds». Diamond exploration in Orapa is currently underway, and resent findings indicate good prospects for boring.
ALROSA is constantly working on increasing operational efficiency through the use of new diamond extraction technologies, developing low-grade deposits and underground mining at deeper levels. Exploring for new deposits in Botswana and Angola, ALROSA employs technologies that have proven themselves in the far northern region of Yakutia but have never been used in Africa yet.
ALROSA is a co-founder of Diamond Producers Association along with the companies extracting diamonds in Botswana: De Beers, Lucara and Gem Diamonds.
• In 2007 – 2014 large Russian mining company Norilsk Nickel was operating Tati Nickel minefield. Exit of this private Russian company from the Botswana market was dictated solely by a new strategy of corporate development, which now targets Russia. Although Norilsk Nickel has been disposing of its assets in Botswana, it does not mean a full stop of cooperation between Tati Nickel/BCL and the Russian Company on technological and scientific & technical issues. According to the terms of the deal, the chains of supply will remain intact, and all nickel and copper matte will still be sent to Norilsk Nickel facility in Finland for refining.
In close cooperation with the Ministry of health and medical authorities in Francistown Norilsk Nickel developed a mobile telemedicine unit “Tobol”, designed to provide different types of diagnostics. In two weeks’ time “Tobol” will be officially handed over to the Ministry of Health. This 1 mln. dollars worth project will significantly contribute to improving health services in remote and scarcely populated areas of the country.
• The private agency “RACUS”, whose office in Botswana was opened in 2001, recruits ambitious Botswana youth to Russian universities. Higher education in Russia is relatively cheaper than in Western Europe and America but it is not inferior in terms of quality. This is why studying in Russia has become an alluring alternative for those who is eager to get education abroad. The most popular specialties are medicine, engineering and IT. At the moment, the organization is elaborating a project to create a Russian institution of higher education in Gaborone/Francistown.
7. We know that the Russia Day, your national holiday, will be celebrated soon. Could You expand a bit on the matter?
The National Day of the Russian Federation, also known in our country as Russia Day commemorates the formal adoption of the Declaration of Sovereignty of the Russian Federation on June 12, 1990. This holiday is generally celebrated as show of patriotism of Russian citizens. This is a summer holiday when a lot of people take walks along the streets of their cities beautifully decorated on this occasion. Some Russians prefer to meet with their relatives and friends. Often people leave cities and go to dachas – this is how we call country houses – to have some rest from bustle and noise and enjoy the nature. In many cities the holiday finishes with fireworks. While it has been an official public holiday since 1991, 2003 was the first year that it was widely celebrated, when it was actively popularized by the President of the Russian Federation Vladimir V. Putin.