In conversation with
Ms. Reinette Van der Merwe

FDI Spotlight: What is the role of Barclays Bank in Botswana and has the R37.7 billion sell down of Barclay’s PLC changed the way you do business here?

Reinette Van der Merwe: The shareholding between South Africa and Botswana has not been impacted at all due to the sell-off. It is purely a transaction between the Johannesburg branch and the London office.

I do believe that it is a very exciting time right now. I have worked with Maria Ramos, CEO of Barclays Africa Group, very closely before and I believe that she has the right vision and mind-set to take Barclays to the next level. What is planned for the future will, in my opinion, definitely make us agiler, as well as give us more of an Africa centred approach.

For example, since we have come together as a group in Africa, we have not ventured into the agricultural space in Botswana. Given our close proximity to South Africa, we have the opportunity to pull agriculture and agribusiness experts across; I have very recently appointed one such expert – the very first one in our history – in our business banking team.

His sole responsibility is to focus on the local farmers. Over the last two years, we have grown the business so much that it has become a requirement to appoint someone specifically for the farming sector. The sale has allowed us to truly become more of a Pan-African bank with a different flavour and more of a focus. There are huge benefits in terms of the structures and changes, and I look forward to seeing how we can move forward.

Other than changes in the reporting structure, Barclays Botswana has benefitted and felt a change in mainly the IT and digital areas. We are seen as one of the top five Barclays branches in the Africa Group and have therefore received many of the latest digital changes.
Our branch also has the highest digital adoption rate. Botswana has a population of roughly 2.1 million people and there are about four million cell phones in the country. Therefore, each person in the country has two phones and it gives us the opportunity to diversify into the country’s Information and Communications Technology sector.

When you look at which of Botswana’s sectors are growth areas, ICT is a perfect example due to the lack of skills, knowledge and the growth spurt it is experience. The mining sector, which is massive in Botswana, is an area of focus for us but we play in it in a very different way than other sectors. Other areas we play in currently are the tourism sector and the growth of small to medium and micro-sized enterprises (SMMEs).
Since we came together as a Barclays Africa Group, we have managed bank our customers regionally. This was not available before the Group was formed. Therefore, because of our footprint in Africa, we have been able to assist a number of Botswana companies to expand into the continent.
The ability to help companies grow and expand their African presence is one of our greatest strengths.

Do you believe that Botswana can, in the future, become less reliant on South Africa and more of a regional hub trading with the SADC region?

Reinette Van der Merwe: I do believe that the financial scope is there to grow the country into that direction. Botswana already possesses many of the elements needed and has the capabilities to allow money to come directly into the country as opposed to flowing through South Africa or Mauritius.

We are and have been having the conversations necessary to start addressing and exploring that option. We are looking at how we can grow the financial services sector, get more Dollar inflows and outflows and increase intra-Africa trade so that trade goes directly or even primarily through Botswana.

If we get the trade flows to pass through Botswana we will be able to boost the economy tremendously. Botswana is also more stable politically than South Africa, which in itself is a huge benefit. There has been a lot of talk for a while about the Mauritius of Africa and while we as an Africa Group currently utilise the Mauritius branch, Botswana has and can present more benefits than Mauritius.

In your opinion, do you think Botswana’s financial sector has a responsibility to drive an entrepreneurial spirit and drive the growth of SMMEs in the country? Do you think you have a responsibility to create an enabling environment for the growth, innovation and diversification when it comes to SMMEs?

Reinette Van der Merwe: I think the Botswana government is doing a lot in terms of driving the entrepreneurial spirit in the country. There are a number of government organisations that support the establishment of SMMEs, and they have created benefits – particularly regarding the youth and young entrepreneurs – to entice other business leaders to do the same.

In terms of our shared growth strategy, we have identified that we have the responsibility to drive and support the growth of SMMEs. We have set up a function that supports small business owners; they can join the SMME club, which is part of this function, and receive mentorship, training and guidance.

We also implement interventions with the youth in terms of financial literacy and knowledge and guidance on how to enter the job market. There are a lot of basic elements such as how to write your CV, how to present yourself correctly in a job interview, how to set up your business and how to act during the first year of your first job that students are not taught at school or university.

There are roughly 20 000 graduates who are capable to enter the job market each year; however, only 2 000 jobs are created. Therefore, the space for economic growth is certainly there and our government has acknowledged that they can and should do a lot more in this regard. They know that in order for Botswana to truly thrive economically, they need to create more opportunities for job creation and diversification.

Botswana, including many other African countries, are seen as closed off to the international community and difficult to invest in. Would you say that the private sector here in Botswana has a unified voice regarding this issue and do you believe that the political will here will change in order to allow a more open economy?

Reinette Van der Merwe: I think that mind-set change has already happened. Over the last three years, we have definitely struggled with not only getting work permits but getting them approved or renewed. There has been a remarkable change that we have seen to that issue this year.
Therefore the will is definitely there, it is now becoming an issue of making sure that we allow the right type of companies into the country and that the right kind of opportunities are created.

Locally we can start creating the right environment to enable those opportunities, such as addressing the skills shortages in the country and the current disconnect between education and industry. The problem with the current education system not only lies within the skills shortages in existing industries and jobs, but in the fact that the next generations need to be educated and trained for the future. Many of the jobs of the future may not exist yet, but it is very important that universities start following the way we can all see the future is heading into.
You cannot develop wagon wheels if we are in the age of sports cars.