Botswana IFSC Botswana as an Emerging Outsourcing and Offshoring Centre.
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Transcript of Botswana IFSC Botswana as an Emerging Outsourcing and Offshoring Centre.
Botswana IFSCBotswana as an Emerging
Outsourcing and Offshoring Centre
Overview
• Positive Investment Climate• What is the Botswana IFSC?• Attributes of the Botswana IFSC• Opportunities • Business Process Outsourcing /
Call Centres• Holding Companies • Funds• Capital Markets• Catalysts
Positive Investment Climate• The government of Botswana
managed the economy extremely well after independence. A positive climate for private sector investment was established.
Commission for Africa
What is the Botswana IFSC?• Aims to develop Botswana as a
world-class hub to facilitate delivery of wide range of cross-border financial services.
• Encourage skills transfer to develop sophistication of financial sector
• Not positioned as tax haven.
Goals
• Measures• Jobs created• Capital
employed• Tax revenue• Measurable
linkages with rest of economy
Attributes of the IFSC
• Benign tax regime• No exchange controls • Growing Double Tax Agreement
Treaty Network • Withholding Tax exemptions for
jurisdictions without treaties. • No Capital Gains Tax (CGT)
Opportunities
Investment Funds
International
Insurance
Non-financial
Companies
BanksCapital Markets
Cross-Sectoral Activities
AfricanAfricanPrivatePrivateEquityEquityFundsFunds
Pan AfricanPan AfricanInfrastructureInfrastructure
FundsFunds
African Centre forAfrican Centre forInternationalInternational
InsuranceInsurance
Pan AfricanPan AfricanBankingBankingGroupsGroups
Pan AfricanPan AfricanCommoditiesCommodities
ExchangeExchange
Centre forCentre forStructured FinancingStructured Financing
Administration & Shared Services CentresAdministration & Shared Services Centres
BPO & Call CentresBPO & Call Centres
Business Process Outsourcing and Call Centres• Lower total costs than South Africa:
– £150 for new agent to £350 for experienced agent
– Rental rates: £5.00 - £6.50 per square metre
– Affordable international telephony rates (£0.02 – 0.03)
• Readily available pool of skilled labour • Close cultural alignment with UK• Botswana provides Western investors
with a solid business proposition for outsourcing services over the long term - Datamonitor
Holding Companies
• Opportunity for companies with growing African network to consolidate financial and administrative functions.
• Micro Provident – Leading domestic micro-lender
extending model into region. – International investors, including FMO,
IFC, Kingdom Zephyr. – Total projected investment of US$45
million– Operational in 3 countries, opening in
4 more next year
Funds• Second largest pension fund
industry in Sub Saharan Africa with £2.3 billion under management.
• A Fund Manager’s view of Botswana– Access to global financial information– Advanced telecoms/ robust connectivity
at competitive rates – Credit rating could be critical in
attracting investment flows– Botswana's liquidity a potential source
of funding to tap into – Transparency/corruption rating and
abolition of FX controls
Capital Markets
• Pan African Commodities and Derivatives Exchange (PACDEX) – Multi-commodity exchange based in
Botswana– Endorsed by African Union– Sponsored by private company - PACP– Mumbai Commodities Exchange strategic
partner• Operates second largest commodities
exchange globally• Recently opened Dubai Gold and
Commodities Exchange – Will lead to improved price discovery,
increased intra African trade, broadening of financial instruments.
Catalysts
• Diamond Trading Company
Botswana
• Availability of pension funds
• Telecommunications
liberalisation
• Botswana Innovation Hub
Conclusion
• Commission into Africa notes
Africa needs:
A partnership between Africa and
the developed world which takes
full account of Africa’s diversity
and particular circumstances.
Thank You.Botswana International Financial Services Centre
2006.