Saturday, January 28, 2023
  • About
  • Advertise
  • Privacy Policy
  • Cookie Policy
  • Contact
  • Subscribe
  • E-edition
  • Login
  • Register
  • Home
  • News
  • Economy
  • Columns
  • Companies & Markets
  • In Business With
  • Lifestyle
    • Motoring
  • Sports
    Debswana sponsors BFA’s National First Division League with P3.9m 

    Debswana sponsors BFA’s National First Division League with P3.9m 

    Ditlhokwe Tipped to Excel at Kaizer Chiefs

    Ditlhokwe Tipped to Excel at Kaizer Chiefs

    BCF Aims to Resuscitate Chess this Year

    BCF Aims to Resuscitate Chess this Year

    Tebogo’s Move to US on Hold

    “Don’t Panic,” Tebogo is advised as He Transits to Senior Level

    NSAs decry Absence of School Sports 

    NSAs decry Absence of School Sports 

    BCF fails to send Team to Continental Schools Chess Champs

    BCF fails to send Team to Continental Schools Chess Champs

    Trending Tags

    • Subscribe
    No Result
    View All Result
    • Home
    • News
    • Economy
    • Columns
    • Companies & Markets
    • In Business With
    • Lifestyle
      • Motoring
    • Sports
      Debswana sponsors BFA’s National First Division League with P3.9m 

      Debswana sponsors BFA’s National First Division League with P3.9m 

      Ditlhokwe Tipped to Excel at Kaizer Chiefs

      Ditlhokwe Tipped to Excel at Kaizer Chiefs

      BCF Aims to Resuscitate Chess this Year

      BCF Aims to Resuscitate Chess this Year

      Tebogo’s Move to US on Hold

      “Don’t Panic,” Tebogo is advised as He Transits to Senior Level

      NSAs decry Absence of School Sports 

      NSAs decry Absence of School Sports 

      BCF fails to send Team to Continental Schools Chess Champs

      BCF fails to send Team to Continental Schools Chess Champs

      Trending Tags

      • Subscribe
      No Result
      View All Result
      The Business Weekly & Review
      No Result
      View All Result
      Home News

      Pula–Rand exchange rate: a pain for domestic businesses

      “They are now paying more than what they used to pay for the same quantity and they pass that down to the consumer, which puts additional pressure on the consumer,” says Basele of FNBB

      mm by Kabelo Adamson
      August 9, 2022
      in News
      Reading Time: 2 mins read
      0
      Year ahead: Spread of new COVID variants to determine pace of economic recovery

      Gomolemo Basele, Quantitative Analyst at FNB Botswana

      Share on FacebookShare on Twitter

      The poor performance of the local currency, the Pula, against other foreign currencies such as the South African Rand (ZAR) has led to an increase in the cost of doing business.

      This is a view held by local businesses in the latest Business Expectation Survey (BES), a quarterly study conducted by the Bank of Botswana that collects information on the domestic business community’s perceptions about the prevailing state of the economy and expectations during the survey period. The Pula has been performing poorly against major foreign currencies such as the US Dollar and the South African Rand during the first half of the year.

      In April, the Pula suffered a 3.6 percent depreciation against the Rand but appreciated by 2.5 percent against the IMF Special Drawing Rights (SDR) and by 1.9 percent against both the US Dollar and the Euro. It followed that with a 1.2 percent depreciation against the Rand in May. However, the Pula appreciated by 1.3 percent against the US Dollar but depreciated by 0.6 percent against both the Euro and the Japanese Yen in the same month.

      In June, the Pula appreciated against the Rand by 1.4 percent but suffered a 3.2 percent depreciation against the US currency. Given this performance by the Pula against the Rand, companies in the construction, manufacturing, and mining and quarrying sectors view the exchange rate between the two currencies as unfavourable and therefore costly to doing business in instances where the Pula weakened against the Rand.

      This is largely compounded by the fact that these companies source most of their raw materials from South Africa. South Africa is a major trading partner for Botswana with the latter getting most of its goods from the former. For instance, in May alone – according to data supplied by Statistics Botswana – Botswana imported goods worth P8.4 billion, 63.4 percent or P5.3 billion of them from S.A. These were mostly fuel, food, beverages and tobacco, and diamonds, followed by machinery & electrical equipment and chemicals & rubber products.

      Along with the volatile Rand-Pula exchange rate, other factors cited by local businesses as impediments to doing business include shortage of raw materials, mainly by the manufacturing industry, weak domestic demand and slow growth in government spending. But adequate water and electricity supply, favourable political climate, international demand and effective regulatory framework were viewed as supportive factors to doing business in Botswana in the second quarter of 2022.

      Economist at First National Bank Botswana (FNBB), Gomolemo Basele, told The Business Weekly & Review in an interview that indeed the depreciation of the Pula against the Rand is painful for both businesses and the consumer. He explained that as businesses source most of their raw materials and finished products from SA, this means they get less value from what they import. “They are now paying more than what they used to pay for the same quantity and they pass that down to the consumer, which puts additional pressure on the consumer,” said Basele.

      Tags: Business Expectation Survey (BES)First National Bank Botswana (FNBB)Gomolemo Basele

      Navigation

      • Home
      • News
      • Economy
      • Columns
      • Companies & Markets
      • In Business With
      • Lifestyle
        • Motoring
      • Sports
      • Subscribe

      Recent News

      • Debswana sponsors BFA’s National First Division League with P3.9m 
      • January 27 2023 Edition
      • Proposed Law to Tighten the Screws on Banks 
      • David Van Niekerk appeals after losing interdiction case 
      • Ditlhokwe Tipped to Excel at Kaizer Chiefs

      Site

      • About
      • Advertise
      • Privacy Policy
      • Cookie Policy
      • Contact
      • Subscribe
      • E-edition

      © 2021 The Business Weekly & Review. All Rights Reserved.

      No Result
      View All Result
      • Home
      • News
      • Economy
      • Columns
      • Companies & Markets
      • In Business With
      • Lifestyle
        • Motoring
      • Sports
      • Subscribe

      © 2021 The Business Weekly & Review. All Rights Reserved.

      Welcome Back!

      Login to your account below

      Forgotten Password? Sign Up

      Create New Account!

      Fill the forms below to register

      All fields are required. Log In

      Retrieve your password

      Please enter your username or email address to reset your password.

      Log In
      This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
      Are you sure want to unlock this post?
      Unlock left : 0
      Are you sure want to cancel subscription?