BAT ZIMBABWE APPOINTS NEW MD: Page 31 $20 News Worth Knowing Calls for rand use escalate: Page 3 October 10-16 2019 ESTABLISHED 1969 @ FingazLive www.fingaz.co.zw Facebook: The Financial Gazette ZSE Report The All Share Index added 0,26 per- cent on Wednesday to close at 233,38 points. Zimre Holdings gained 15,17 percent to end at $0,082, while CAF- Zim is on CA traded 6,67 percent higher at $1,60. OK Zimbabwe gained 4,07 percent to close at $0,6038. The In- dustrial Index was up by 0,26 percent to close at 779,13 points, while the Top 10 Index was up by 0,33 percent at 218,81 points. The Minings Index was flat at 278,28 points. Currencies (Bloomberg) % change USD:ZAR 15,1732 0,70 ◀ ◀ EUR:USD 1,0981 0,22 autopilot, ◀ GBP:USD 1,2225 0,05 ◀ USD: JPY 107,3600 0,25 Stock Markets ◀ ZSE (All Share) 233,38 0,26 ZSE (Minings) 278,28 0 12 776.00 0.96 JSE ◀ ◀ FTSE 100 7 176.98 0.47 ◀ Dow 26 304,89 0.54 Commodities ◀ business Gold 1 506.83 0.09 0,43 Platinum 886,15 ◀ ◀ Brent Oil 58,90 1,13 Grains (Grain SA) ◀ White Maize ZAR 2 378,14 3,1 ◀ Soya ZAR 5 164,15 1,4 ◀ Wheat ZAR 2 806,50 3,1 Old Mutual Kudabemoans Chideme laws which experts say are choking both com- Markets Editor merce and industry. This comes as the government has just effected board faces jail XPERTS say it is becoming increasingly an outright ban on the local use of the American OLD Mutual has made an impassioned plea to the South African High Court, say- difficult to discern a coherent government dollar, in addition to controlling certain aspects of ing the potential imprisonment of board Eplan to fix the country’s shrinking, diseased mobile money services and implementing foreign members — if they are found guilty of economy — with many of the policies that have currency duty-exemptions for a few select com- contempt of court for not allowing ousted been implemented by authorities over the past panies. chief executive Peter Moyo to return to two years described as slipshod at best. “These are difficult times, with the govern- work — would be “excessive and inap- While many economists accept that President ment either unwilling to take the necessary tough propriate”. Emmerson Mnangagwa’s administration inherit- decisions or implementing a raft of poorly-con- It was responding to Moyo’s applica- ed an economy in bad shape from the regime of ceived policies such as many of the recent statu- tion at the high court in Johannesburg to his late predecessor Robert Mugabe, they are con- tory instruments. declare the insurance group’s 13-member Basil Dionisio, Simbisa Brands' group chief executive, says board to be in contempt of court for block- cerned that things are getting worse by the day — “One sometimes even gets the unfortunate im- constrained consumer spending and depressed trading ing him from returning to his office three with the stewardship of the country’s key national pression that the country is on autopilot at the mo- activity will remain a challenge for the business in 2020. The times. affairs seemingly on autopilot. ment,” an exasperated chairman of a Zimbabwe fast food retail giant’s revenue increased by 79 percent to Moyo has been prevented from re- Among the ill-considered policies that pan- Stock Exchange-listed company told The Finan- $255 million in the year to June 30, 2019. suming his duties as CE despite the court icking authorities have taken recently are a raft cial Gazette this week. Picture by Freedom Mashava ordering twice that he should be temporar- of statutory instruments (SIs) and other knee-jerk To Page 2 ily reinstated as CE. — Moneyweb Page 2 | October 10-16 2019 The Financial Gazette National News Zim is on autopilot, business bemoans From Page 1 omy “is dead”, experts are surprised that the a negative impact on interbank trades, which “Zimbabwe’s economy is facing serious “The policy inconsistencies are of grave concern to government has veered off its ambitious plan to bankers say have gone down to zero. headwinds and what it needs now is protec- investors,” Victor Bhoroma, an economist, said. revive the sluggish economy by restoring order In the meantime, experts say, the economy tion of investment and policies that stimulate “Policy inconsistencies make it difficult for prospec- to public finances — particularly with the Inter- is slowly re-dollarising, with some businesses growth. Sadly, that is not happening at the mo- tive and committed investors to plan. It also reduces bank national Monetary Fund (IMF) having warned continuing to charge in foreign currency despite ment,” it said. lending ratios and financial planning at corporate level,” the country that it has a slim chance of success- the government ban on the local use of foreign At the same time, many experts also con- he said, adding the “recent change from the multi-curren- fully re-balancing its books. currencies, as inflation also continues to batter tend that Zimbabwe’s economy will not bounce cy regime to bond notes and then RTGS dollar as well as This comes as the government has flip- the local currency and the economy at large. back to life in the absence of a bailout pack- latest exchange rate directives ranked among the biggest flopped on the funding of the controversial Meanwhile, local think-tank Econometer age in the region of US$2 billion — funds examples of policy chaos ”. command agriculture programme, while the Capital Global has also expressed misgivings which the country cannot currently access. “The same can be said about the recent ban on grain new exchange control regulations have had about economic developments in the country. [email protected] movement through SI 149 of 2019 and suspension two months later,” Bhoroma said. “There is an urgent need to separate key institutions such as central bank operations (monetary policy) from political decisions. It’s also vital for the government to consult... the Confederation of Zimbabwe Industries, bankers and farmer unions,” he said. “There is also need to practise due diligence before announcing market defining policies today and changing direction tomorrow,” Bhoroma added. Jacques Nel, an economist with think-tank NKC Af- rican Economics, said confidence in the government re- mained low — adding that the recent re-introduction of the Zimbabwean dollar was among the biggest policy miscalculations for the country’s fragile economy. “Zimbabweans still have little faith in the govern- ment’s ability to create and maintain its own sovereign currency, but the dire situation has forced many to adopt its usage and go along for the ride,” he said. “Cash shortages continue to hamper economic activ- ity, and addressing this remains one of, if not the most pressing economic issue,” Van der Linde said. “However, dusting off the printing presses will by no means be the solution to the problem, with much harder work required on building confidence in fiscal finances and attracting hard currency to give the local unit some semblance of credibility,” he said. Industry minister Mangaliso Ndlovu commissions ZFC's new fertiliser blending plant in Aspindale, Harare, on Monday. The plant — And with Mnangagwa himself having acknowledged valued at US$500 000 — has the potential to produce 300 000 tonnes of blended NPK fertilisers per year, which is an upgrade from the in his recent state of the nation address that the local econ- previous one that produced 150 000 MT. NRZ US$400m deal in limbo John Kachembere dled to less than 4 600. Assistant Editor Neglect, lack of spare parts and obsolete equipment have led to a situation where only part HE National Railways of Zimbabwe of the railroad network is in good condition. (NRZ)'s US$400 million recapitalisation The company is sinking in debt, making it im- Tdeal is in limbo after Transport minister possible to get out of the quagmire without exter- Joel Biggie Matiza opened it to new investors. nal help. Freight declined from 18 million tonnes Government last year signed an exclusive in 1998 to 4 million tonnes in 2015. deal with the Diaspora Infrastructure Develop- Vandalism has paralysed the communications ment Group (DIDG) and South Africa’s railway system and the geographical spread of the net- giant Transnet to resuscitate NRZ. work made it almost impossible to adequately Although President Emmerson Mnangagwa protect and guard it. last week said he was happy with the US$420 Local think-tank Econometer Global Capital million raised by DIDG — through the Afrex- (Econometer) last week warned that continued imbank and other regional banks —Matiza threw delays in implementing the deal could jeopardise the cat among the pigeons when he unilaterally revival of the parastatal, which is key in econom- removed the exclusive clause on the deal ic revival. The Zanu PF legislator said government is “The NRZ deal reminds many of the failed still actively looking for other investors to rope resuscitation of Ziscosteel,” Econometer said. into the recapitalisation project. This is despite “There was pomp and fanfare when Indian the fact that DIDG has provided proof of funding investors were announced as saviours for the and the Martin Dinha-led NRZ board has also Joel Biggie Matiza yesteryear steel giant. The deal collapsed due to given its blessings to the deal, which has dragged ing the project with DIDG,” said a senior gov- disputes over concessions and bureaucratic red on for the past ernment official. tape. The chances of reviving Ziscosteel are al- 18 months due Financing term sheets seen by this publica- most remote.” to conflicted se- tion show that Standard Bank is ready to inject Indian firm Essar Africa Holdings in 2011 nior government US$317 million, Absa US$200 million, Nedbank promised to inject $750 million into Ziscosteel, officials and ad- US$200 million and the Industrial Development but the deal collapsed in 2016 leading to Essar’s visors.