By John Helmer, Moscow
The International Monetary Fund (IMF) is delaying a decision on Botswana by the Fund’s executive board and shareholders as IMF staff are discreetly encouraging the Botswana Government to reject a breach of contract claim by Norilsk Nickel.
The leading Russian mining company, and the world’s largest nickel producer, is suing in London, Botswana and South Africa after the Botswana government put its state mine holding BCL into bankruptcy last October, halting payment of $277.2 million which Botswana, BCL Investments (BCLI) and the BCL Ltd. holding company agreed to pay since their first contract of sale and purchase was signed with the Russians in 2014. The Norilsk Nickel default claim is one of the largest liabilities facing the Botswana state budget. The default is also casting a shadow over future foreign investment in the country, and the government’s credit rating for foreign loans.
An IMF team was in Gaborone, the Botswana capital, in May for a fact-finding mission and consultation with government officials, the first the IMF has held in the country since December 2015. The IMF requested and received briefings on the Norilsk Nickel case from government officials and also from the provisional liquidator, Nigel Dixon-Warren of the KPMG accounting firm. He was appointed last October by the Gaborone High Court to supervise liquidation, sale of assets, and debt recovery from the bankrupt BCL group of companies.
On June 15, the court ordered a six-month extension of time for negotiations — BCL went into final windup, while BCLI and Tati Nickel were kept in provisional liquidation for the dealmakers. According to a courtroom source, the extra time is for the government “to determine whether we can deal with those companies at the shareholding and creditor compromise level”. In short, for Dixon-Warren to strike a price for the nickel and copper reserves and mining assets which BCL owns in order to satisfy BCL’s creditors and cover BCL’s liabilities.
Anne-Marie Gulde-Wolf, who supervises Botswana at IMF headquarters in Washington, said after the IMF staff returned from Gaborone on May 16, that she was planning to finalize the Botswana report and submit it to the board for decisions planned for June. Gulde-Wolf was asked what the IMF was doing in the dispute between Botswana and Russia. “I have asked the mission chief for Botswana, Mr. Enrique Gelbard to look into the matter,” she replied. “He will be in touch should there be anything we can share. “
Asked to clarify why no report was submitted to the IMF board during last month and no decisions voted on IMF policy towards Botswana, Gulde-Wolf, Gelbard, and the IMF spokesman for Africa, Lucie Mboto Fouda, now refuse to say.
In Moscow, a source close to Norilsk Nickel said the company “has welcomed a statement by the Botswana government that it plans to resolve the issue with Norilsk Nickel. We look forward to the arrangements the government intends to make.” To date, the IMF had made no contact with the company either in Gaborone in May, or since then. (more…)