With Botswana tourism attracting super rich Hollywood stars, football billionaires and the English royal families, it easily generates over P6 billion every year, but 90% of the money never arrives to Botswana herself. The Panama Papers revealed that numerous African politicians have stored wealth in off-shore accounts. But how did the money get there?
The Okavango Delta in Botswana, a World Heritage Site known for its magnificent sunsets, vast plains and impressive wildlife, contributes over US$ 650 million annually to the country’s gross domestic product.
Tourism is its second-biggest money-earner after diamonds. Rich and super-rich foreigners -among them Oprah Winfrey, Chelsea owner Roman Abramovic, Microsoft billionaire Paul Allen and UK’s Prince Harry- fly in to the Delta in their private jets to rest in luxurious lodges and enjoy the scenery.
The considerable prices they pay for their holidays, however, do not fund the southern African country’s budget as much as they might imagine. Large parts of the bills paid for this ‘African paradise experience’ fund a number of tax-haven-based off- shore accounts that belong to the Wilderness Safari conglomerate in which President Ian Khama and his relatives and friends hold shares.
Botswana’s peaceful and prosperous image, with its legendary tale of a first black president and his white English wife -as shown in the 2017 Hollywood release ‘A United Kingdom’- still dominates international public opinion. Perhaps more than other country studies, Botswana shows how such stereotypes disadvantage ordinary people who bear the brunt of the ugly side of the untold story. Gazing at the blissful sunsets, tourists do not notice the poverty around them, nor the fear brought on by an increasingly oppressive security network built up by the president and his friends and relatives who keeps people in the dark whilst a ‘paradise’ is being looted.
Sixty percent of Wilderness Safaris’ annual revenue of US$ 200 million, almost one third of the value of the total tourism sector in Botswana, is derived from over 25 000 guests in seventy different safari camps and lodges in the southern African region per annum. These tourist payments are largely made to travel agencies in their home countries. Overseas Adventure Travel/ Grand Circle, based in the US, for example, conducts business with Baobab Safaris, a subsidiary of Wilderness that President Ian Khama holds a sixty percent stake in. Such income pays dividends to concessions such as Linyanti, owned by the president and other shareholders -among whom are his relatives and close associates and the money never arrives in Botswana herself.
More than half of Wilderness’ tourism and travel subsidiaries are operated from abroad. Wilderness Safaris Limited-Bermuda, New Wilderness Holdings of Mauritius and Norisco SA in Luxembourg and Seychelles are finance and asset management arms of the group that are based in jurisdictions that allow very low to zero percent taxation. The tax-haven based entities have no employees or organisational and or operational activities. Except for an island resort managed by Norisco Holdings in Seychelles, they also have no camps, safaris and hotels doing genuine business. Asked to comment, Wilderness said the Bermuda account housed “the group’s insurance fund.”
“This situation (has) made it possible for a lot of money that is paid for tours by visitors to never arrive in the Okavango or Botswana, since booking is mostly done outside Botswana -either in Johannesburg, America or Europe. The exclusive nature of tourism in the Okavango Delta has tended not to be of direct benefit to the people of Ngamiland District (since) the tourist revenue is not retained in Ngamiland or in Botswana,” writes Professor Joseph Mbaiwa of the University of Botswana in a recent tourism revenue study. Mbaiwa believes that as much as ninety percent of this value may be retained outside the country in payments to external travel agents, expat wages and food and other supplies imported from outside Botswana as well as profits.
He bases his findings on calculations that over eighty percent of the ‘paradises’ in Chobe and the Okavango are at least partly owned by foreign companies, with over fifty percent of these fully owned by foreign safari operators. Mbaiwa’s study also does not see many benefits for the region from the current tourism ownership structures. “Botswana’s exclusive and luxury multi-billion-dollar wildlife-based tourism industry is situated in Northern Botswana. Ironically, poverty in Northern Botswana is reported to be widespread,” he writes. Echoing similar concerns, Member of Parliament for the ruling Botswana Democratic Party Ignatius Moswaane argued in parliament in September 2016 that “(the fact that) tourism operators across Central Kalahari and the famous Okavango Delta, Wilderness Safari (are) owned by whites is a source of concern for aspirant Batswana tourism operators.”
Mbaiwa also points at ‘elitist photographic tourism’ as a cause of job losses (calculated by him as over 200 in the past four years) in the sector. He believes this is also due to a 2013 ban on safari hunting: “The loss of jobs and income by communities due to the ban on safari hunting in favour of elitist photographic tourism, suggest that the already high poverty rates in Northern Botswana particularly in Ngamiland District will continue to rise.” Safari hunting jobs were previously held by members of the San/Basarwa communities, who have lived hunting and gathering lifestyles for centuries. In part due to the hunting ban they have been forced to abandon this way of life and now live in settlements on the periphery of the Okavango Delta. According to the Botswana Department of Wildlife and Parks, the hunting ban has also led to complaints from villagers whose farms and villages have been damaged by expanding herds of elephant and prides of lion.
A PRESIDENTIAL FAMILY
The Khama family plays a very active role in the travel and tourism industry. The Ministry of Tourism, headed by the president’s brother Tshekedi Khama, presides over the awarding of the tourism concessions through Botswana Tourism Organisation (BTO). Former Wilderness Safari Human Resources Director Sally Anne Follet- Smith heads the Botswana Tourism Organisation (BTO), a parastatal that regulates and controls stakeholders in tourism. Follet-Smith is also a board member of national airline Air Botswana, a company that was recently almost given, by presidential directive, to Wilderness Safaris in exchange for an undertaking that it would inject US$ 30 million to jump start it. Simultaneously, the government would also provide a US$ 30 million capital injection. The transaction failed to materialise following media reports that exposed the impending deal, which would have seen Wilderness acquiring a state asset for a song.
President Khama himself owns shares in Baobab Safaris, Seba Safaris and Linyanti, all concessions of the Wilderness Group whose chairman of the Board is the president’s lawyer and confidante Parks Tafa. The Wilderness Board further features Marcus Patrick Khama Ter Haar, the president’s nephew. Approached for comment, Botswana government spokespersons said that the president and his associates and relatives hold shares in their individual capacities and that they declare them.
The Botswana Unified Revenue Services, despite confirmations of lack of expertise and resources to understand and track illicit finances, states in its latest financial report that it is being owed more than 2 billion Pula, US$ 200 million, in both unpaid and uncollected taxes.
THIS STORY IS PART OF A TRANSNATIONAL INVESTIGATIVE REPORT titled THE PLUNDER ROUTE TO PANAMA: How African Oligarchs Steal FromTheir Countries by The African Investigative Publishing Collective. The AIPC is an association of veteran investigative journalists across Africa.
FULL REPORT WILL BE AVAILABLE FOR DOWNLOAD ON THURSDAY