Botswana’s capital markets have entered a new era with the launch of the country’s first actively managed Exchange Traded Fund (ETF), the Vunani Global Equity Prescient Feeder Actively Managed ETF.
This milestone builds on the Botswana Stock Exchange’s (BSE) pioneering history as the first African exchange outside Johannesburg to list ETFs over a decade ago. Since the world’s first ETF debuted in Canada in 1990, the product has evolved from a passive investment vehicle into one of the fastest-growing and most sophisticated tools in global portfolio management. Botswana is now taking a leading step forward by embracing active management within its ETF landscape.
Actively managed ETFs represent a significant evolution from traditional passive ETFs that simply track fixed indices. By combining the transparency, liquidity, and cost efficiencies inherent to ETFs with expert portfolio management aimed at outperforming benchmarks, these products offer investors diversified exposure to global equities while benefiting from professional oversight.
Central to this advancement is the BSE’s mandate to deepen market participation, facilitate access to capital, and expand the range of financial instruments that foster wealth creation and sustainable economic growth. The Exchange said the launch of this instrument not only enriches offerings for domestic investors—including pension funds, asset managers, and retail participants—but also strengthens Botswana’s position as a sophisticated and globally connected investment marketplace.
“ETFs remain one of the fastest-growing product classes in global markets, offering investors transparency, cost efficiency, and diversified exposure. Here at home, ETFs have become an integral part of our investment landscape, providing pension funds, asset managers, institutional investors, and retail investors with accessible, liquid, and reliable avenues to deploy capital,” said Kopano Bolokwe, Head of Product Development at the BSE, during the instrument’s issuance celebration.
The new actively managed ETF adds meaningful depth to this ecosystem. Bolokwe noted that its global equity exposure enables investors to participate in international markets through a locally listed instrument, providing a regulated and efficient channel to diversify portfolios beyond Botswana’s borders.
“This is precisely the type of innovation we seek—products that meet evolving investor needs while complementing our long-term market development strategy,” he added.
The ETF’s structure as a Botswana-domiciled fund with local asset status is particularly significant. It allows Botswana-based investors to access international markets through a regulated, locally listed vehicle, aligning with portfolio construction needs and regulatory frameworks. According to Butana Khoza, Group Executive at Vunani Limited, the instrument also encourages regional integration within the Southern African Development Community (SADC), fostering cross-border collaboration and capital market linkages.
Market reaction has been positive. Khoza pointed out that leading pension fund managers, consultants, and investment platforms in Botswana have already expressed keen interest, reflecting a maturing asset management industry committed to expanding the investment toolkit for domestic savings. This willingness to co-invest and engage with innovative products underscores growing confidence in the country’s regulatory environment and financial infrastructure.
Beyond institutional investors, the Vunani actively managed ETF offers new wealth creation opportunities for the “man in the street.” Accessible through the stockbroking industry, Khoza explained that it lowers barriers and provides a safe, regulated vehicle for long-term savings growth. He emphasized that raising awareness and investor education around such products is vital, as Botswana’s increasingly financially savvy population seeks to transform their financial futures.
Khoza stressed that an active, financially empowered population ultimately strengthens the economy, with broad participation in saving and wealth-building serving as a key growth driver.
“What we hope to have introduced into this economy and market is an instrument that gives the people of this country a genuine opportunity to do exactly that,” he said.
Regulators, particularly the Non-Bank Financial Institutions Regulatory Authority (NBFIRA), have played a pivotal role in enabling this development. Khoza credited their forward-thinking approach and readiness to authorize innovative products with positioning Botswana at the forefront of financial market evolution in Africa. The granting of local asset status to the ETF sets an important precedent, stimulating interest across the SADC region.
Juliana White, Director of Capital Markets at NBFIRA, highlighted the timing of the launch for a market that has long contended with structural illiquidity, limited investment choices, and concentration in a small pool of assets or low-quality holdings. She said the actively managed ETF offers a tool to help break this cycle.
“This is not just another product launch; it is a definitive solution designed to turn market inefficiency into a strategic advantage,” White said.
Innovative instruments such as actively managed ETFs allow institutional investors, including pension funds and insurance companies, to better manage risk and diversification without shifting capital abroad. By providing mechanisms for hedging, accessing broader exposures, and expressing nuanced investment views, such products reduce the need for forced sales during market stress and enhance overall financial system stability.
“This makes the entire financial system more robust and less prone to panic-driven collapses,” she said.
White stressed that product innovation must be accompanied by strong oversight. NBFIRA ensures that new instruments remain transparent, well-structured, and clearly marketed, with operational systems robust enough to accommodate the challenges of an illiquid underlying market. Clear communication of risks and opportunities, she added, is essential to maintaining investor confidence.
“Our enthusiasm for innovation is, and must be, tempered with rigorous oversight,” she emphasized.
