TRANSFORMATION TO KNOWLEDGE SOCIETY BASED ON HIGH SKILLED EMPLOYMENT

How to compensate the decline of diamond revenues:

Dreves – TECNovember 2009

ACTUAL DIAMOND / MINING CONTRIBUTION TO NATIONAL INCOME / PRODUCTION (GDP)

Structure of GDP – 2007/08

Mining 40% Government 16% Banks, Ins.& Business 12% Trade, Hotels & Restaurants 11% Construction 5% Transport 4% Social & Personal Services 4% Manufacturing 4% Water & Electricity 2% Agriculture 2%

DIAMOND CONTRIBUTION TO EXPORTS

Structure of Exports of Goods & Services 2008

Diamonds 57% Nickel & Copper 13% Tourism 5% Textiles 5% Meat 2% Salt & Soda ash 1% Gold 1% Other Services 7% Other Goods 9%

DIAMOND CONTRIBUTION TO GOVERNMENTBUDGET (PULA MILLION)

2006/07 2007/08 2008/09

Revenues +Grants 27397.71 28629.47 29681.32

Revenue 26949.32 28052.10 29276.23

Tax Revenue 15919.00 17266.93 18675.64

Mineral Tax 3802.78 3769.37 2972.00

Non Tax Revenue 11030.32 10785.17 10600.59

Mineral Royalties & Dividends

9311.56 8564.29 7888.00

Grants 448.39 577.37 405.09

Expenditure + Net Lending

19737.44 24821.86 35876.52

Surplus/Deficit 7660.27 3807.61 -6195.20

FROM DIAMOND REVENUES TO CORPORATE TAX

Average Annual Diamond Revenues 2006-2009:

12.000.000.000. BWP (12bn P)Equivalent to:

1.000.000.000 EUR (1bn EUR)

REQUIREMENTS FROM PRIVATE SECTOR

1. Tax on Corporate surplus: max. 20%2. If 20% = 1.000.000.000.- EUR, then:3. Necessary profit = 5.000.000.000.- EUR4. Return on Investment (ROI) = Capital Rentability:

min. 10% (Risk / Venture Capital)5. Total Investments in 10 Years has to rise to:

50.000.000.000.- EUR

PROFIT – PRODUCTION - EMPLOYMENT

1. Return on Sales (corporate efficiency): 20%2. Exceeded total annual private sector

production: 25.000.000.000.- EUR3. High Labour productivity (knowledge –based):

50.- EUR/ hour x 40 hours x 4 weeks x 12 months = 100.000.- EUR p.a. and person

4. 25.000.000.000 EUR 250.000100.000 EUR employees

EMPLOYABILITIES: TRAINING & EDUCATION

1.Total unemployed population 2005/2006:248,812

Age group 15 – 34: 69% = 171,680

2. Supply of Graduates during 10 years(estimation):100.000

3. drop out from mines and government and retirements:?

CONCLUSION:

It’s Possible !

THANK YOU FOR YOUR ATTENTION