1. Botswana IFSC Botswana as an Emerging Outsourcing and Offshoring Centre

2. 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

3. 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

4. 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.

5. Goals Measures Jobs created Capital employed Tax revenue Measurable linkages with rest of economy

6. 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)

7. Opportunities Investment Funds Internationa l Insurance Non- financial Companies Banks Capital Markets Cross-Sectoral Activities AfricanPrivateEquityFunds Pan African InfrastructureFunds African Centre for InternationalInsurance Pan African BankingGroups CommoditiesExchange Centre for Structured Financing Administration & Shared Services Centres BPO & Call Centres

8. 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

9. 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

10. 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

11. 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.

12. Catalysts Diamond Trading Company Botswana Availability of pension funds Telecommunications liberalisation Botswana Innovation Hub

13. 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.

14. Thank You. Botswana International Financial Services Centre 2006.