Botswana’s Metals Industry Collapses

December 12
6:01 PM 2016

The once busy streets of Selebi Phikwe in Botswana has become empty, as it witnessed copper and nickel mines shutting down due to commodity price slump.

The state-owned mining company BCL Ltd. shut down its operations, leaving the area seemingly like a ghost town. The company incurred a 1.2 billion pula loss in 2015 in its operating costs because of commodity price out.

Botswana was put under provisional liquidation two months ago due to non-profitability. The government could not afford keeping the mine operational because that would mean suspending other government commitments such as educational funding and providing Anti-retroviral drugs.

Since the government said that it cannot provide the $748 million needed to recapitalize the mine, it consulted former central bank Governor Linah Mohohlo for a plan to revive the region.

When BCL Mine and its subsidiary Tati Nickel Mine closed early in October, the company's chair, Khaulani Fichani, said that the next steps will depend on the recommendations of the liquidator. The report, which is expected to be released on February, will specify whether all jobs or only a few should be shed.

"It all depends on what the liquidator recommends. If his report recommends that we totally shut down the mine, then everyone will be retrenched and they will be paid off their benefits. If he recommends shedding of some of the operations, all the workers that are not in the new structure would be made redundant and paid off," he said.

"There is despair, anguish and sorrow. The future for many is uncertain. For some there is no future," commented Dithapelo Keorapetse, one of the town's members of the Parliament.

The series of company shutdown, involving BCL Mine, Discovery Metals Ltd., African Copper Plc and Tati Nickel Mining Co., have decimated the copper and nickel industries. The said companies combined accounted for about 4.5% of the southern African nation's exports in the first half of the year.

The government is hoping to find a buyer for the BCL Mine. Firms from South Africa, Mozambique and Canada have already inquired about possible deals.

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