Stanbic Bank Botswana, which is a member of Standard Bank Group, has, along with the Overseas Private Investment Corporation (OPIC), the US government’s development finance institution, and Botswana Finance, a subsidiary of Lazare Kaplan International, signed a $125-million loan guaranty, which will encourage and support lending to diamond manufacturers and polishing companies, while allowing the organisations to share credit risk.
The loan guaranty will help diversify Botswana’s economy, drive the development of the local financial sector and provide local companies with access to financing.
Stanbic Bank has been lending to diamond beneficiation companies in Botswana for over ten years, and this facility will support and allow it to expand the availability of financing for the sector, the bank said.
“With the support of OPIC financing, this project will keep the value-adding process of the diamond supply chain in Botswana, promoting local job creation, diversifying economic growth and bringing [about] global trade opportunities,” said OPIC president and CEO Ray W Washburne.
“We expect continued growth in Botswana’s diamond beneficiation sector to have positive residual effects on several sectors, including electricity, finance and business,” said Stanbic acting CEO Samuel Minta.
This is the second tranche of a $250-million OPIC loan guaranty.
Announced in July, OPIC’s Connect Africa initiative seeks to invest $1-billion over three years to projects that support telecommunications and Internet access, value chains that connect producers of raw materials to end-users, and critical infrastructure, such as roads, railways, ports and airports.