The UAE’s Albaddad and Botswana team up on USD 1.9 bn urban build

Botswana is the UAE’s latest investment destination in Africa. Dubai-based construction solutions firm Albaddad is planning to build a USD 1.9 bn urban project in Botswana, Bloomberg quoted state-owned Botswana Development Corp (BDC) as saying.

The project is set to become one of the biggest foreign direct investment (FDI) projects in Botswana — with Albaddad providing all the capital for the project, BDC’s managing director Oteng Keabetswe said. BDC is providing the land for the build, and will have a 5% holding for now, which it hopes to increase to 26% over time, Keabetswe added.

The details: The 124k sqm multi-use New Botswana City development will be made up of a trade and exhibition center, office spaces, as well as retail facilities, and residential developments, and five hotels. Work on the Botswana World Trade Center is already underway, Botswana’s President Duma Boko said.

Behind the move: Botswana is looking “to use other people’s capital to advance [its] growth mandate […] as our current capital is drying [up],” Keabetswe said. He flagged that his country was “a safe haven” for foreign investors, and that it “provides the security [and] no exchange controls [...] that are important to global capital.”

IN CONTEXT- While the UAE doesn’t currently have a significant footprint in Botswana, it is active elsewhere in Africa, primarily in the mining and logistics sectors, and is now the biggest state investor in Africa. Emirates-based players have footholds in the mining sector in Ethiopia, Mali, Ghana, and Zambia, while state-backed logistics players including DP World and AD Ports are active in the DRC, Cameroon, the Republic of the Congo, among other countries, as the UAE looks to lock in access to critical minerals as well as the supply chain links to move them.

ALSO- The Emirates is similarly active in the urban development sector abroad. Emaar founder Mohamed Alabbar recently announced plans to invest USD 10-11 bn in real estate developments in and around Damascus, with his international development-focused firm, Eagle Hills, weighing up some USD 50 bn in developments in Syria. Other Emirati overseas development plays include the USD 35 bn Ras El Hekma project in Egypt, and the AED 12 bn project in London’s Thameside West development.