'New Zim Lockdown Will Retard Economy'

Scrap punitive Intermediate tax, says ZNCC: P3

News Worth Knowing Covid: More woes for tourism: P4

January 07-13 2021 ESTABLISHED 1969 @ FingazLive www.fingaz.co.zw Facebook: The Financial Gazette Z$260

ZSE Report THE ZSE All Share Index eased anoth- ‘New Zim er 46,34 points (1,76 percent) on Tues- day to close at 2 583,03 points. Hippo Valley Estates lost $5 to end at $85, while RioZim was down by $2,95 to trade at $12 and Delta was $2 weaker at $20,56. Innscor also decreased by $1,48 to close at $35,54.Trading in the lockdown positive; ZB rose by $4,80 to trade at $28,80, while TSL added $3,45 to close at $20,7 and NMB was $0,7 firmer at $4,7. Nampak also increased by $0,45 to close at $2,74 and Truworths traded $0,05 higher at $0,34. There were no will retard trades on the VFEX. Currencies (Bloomberg) % change USD:ZAR 14,9126 0,02 ◀ ◀ EUR:USD 1,2283 0,25 ◀ GBP:USD 1,3421 0,32 USD: JPY 103,2301 1,23 ◀ Stock Markets 2,583.03 1,76 economy’ ZSE All Share ◀ Top 10 1,601.23 3.22 ◀ JSE 59,234.26 0,05 ◀ ◀ Tendai Kamhungira saving livelihoods” — including protecting FTSE 100 6,612.54 1,14 ◀ and Omega Ukama jobs and the country’s fragile economy. Dow 30,934.21 1.13

Staff Writers With the previous lockdown measures Commodities ◀ having resulted in massive supply chain dis- Gold 1,845.23 0,45 ◀ HE potential damage to business and ruptions and a precipitous drop in demand Platinum 1,234.56 0,83 ◀ the recovering economy of the sec- in most sectors, local businesses were hit Brent Oil 51,60 0,67 ond hard national coronavirus lock- hard by the economic fall-out of the global Grains (Grain SA) ◀ T White Maize ZAR 3,298.32 0.12 down could be “immense”, especially if this pandemic. ◀ were to be extended, experts have warned. The fears, particularly given the continu- Soya ZAR 8,854.43 1.23 ◀ This comes after the government re-im- ing financial fragility of many businesses in Wheat ZAR 4,921,32 1.34 posed harsh pandemic regulation measures the country, were that many small business- at the weekend — which were first enact- es would again close down permanently — PDL for one at ed with hugely negative economic conse- as they did not have enough cash on hand to quences when the disease first hit Zimba- sustain themselves during this second hard bwe’s shores last year — to curb resurgent lockdown. $4 426: Zimstat Covid-19 deaths and infections in the coun- Effie Ncube, the spokesperson of the Na- ZIMBABWE's total consumption poverty datum line (PDL) for one try. tional Consumer Rights Association, was person stood at $4 426 in November Among other things, the hard lockdown among the experts who said the lockdown 2020, data released by the Zimbabwe includes a dusk-to-dawn curfew for con- would have an “immense impact on busi- National Statistics Agency (Zimstat) sumers, the total closure of “non-essential” ness and the economy in general”. shows. and informal businesses for at least 30 days “Business, like the rest of the econo- The PDL is the minimum amount from this week, and sharply reduced work- my, relies on consumption to drive sales, of money that an individual requires ing hours for the retail sector in particular. growth and profitability. A lockdown natu- for food and other essential require- The experts who spoke to The Financial rally takes away consumers and income that ments for them not to be deemed poor. Gazette this week said while they under- businesses need. According to Zimstat, the food stood the need to save lives, the new lock- “In the meantime, operational costs, as poverty line (FPL) for one person in down was inopportune as it had come just a percentage of overall costs, on the other November 2020 stood at $3 279. The as the economy was beginning to recover. hand, will not go down. This may lead to Marjorie Mayida, Old Mutual Investment Group (OMIG) Zimba- impact of the Covid-19 outbreak and bwe’s managing director at the launch of Zimbabwe’s first Exchange In that regard, they added, the govern- some businesses retrenching workers in or- hyperinflation have eroded incomes, Traded Fund (ETF). The diversified financial services group says it leaving at least four million Zimba- ment needed to make sure that it struck the der to stay afloat,” he said. will provide initial seed capital for the newly-introduced publicly trad- “right balance between saving lives and To Page 2 bweans at risk of hunger over the ed ETF, which started trading on the local bourse this week. next six months. Page 2 | January 07-13 2021 The Financial Gazette News ‘New Zim lockdown will retard economy’ From Page 1 for business. The ZNCC has also been one of the major restaurants had stocked up on food which they will now not To that extent, Ncube added, there was need “Lockdown measures must come with both proponents for the scrapping of the two percent be able to sell. This is going to affect people’s incomes and for the government to avoid a long and complete a sunset clause, as well as mitigatory measures. Intermediated Money Transfer Tax on both lo- purchasing power. lockdown, as this had the potential to “kill busi- Business requires certainty, and the chances of cal and foreign currency electronic transactions “It’s a sad situation for many Zimbabweans. But I think nesses”. a managed exchange rate due to this imposed — arguing that the levy amounted to double we are still luckier than people in say South Africa and Eu- “Stricter enforcements of rules may also al- lockdown remain high — which might mean taxation. rope,” Robertson said. low for a lockdown to be relaxed and allow busi- pressure for businesses once we lift the lock- John Robertson, an economist, said the cur- With the latest strict lockdown coming with the poten- nesses to run nearly as normal as possible. down. rent situation was difficult, as there was a need to tial to sabotage business again, Confederation of Zimba- “The key drivers and super spreaders of “We don’t see the exchange rate depreciat- strike a balance between the interests of business bwe Industries (CZI) chief executive, Sekai Kuvarika, said Covid-19 are not businesses, but social gather- ing during the lockdown. In fact, the appetite to and curbing the spread of the pandemic in the her organisation would reach out to its members with a ings and carelessness among people in their day fix or manage it remains high, which therefore, country — which had affected millions of people view of coming up with mitigatory plans — just in case the to day activities. means continuous shortages of forex,” he said. globally. restrictions were extended. “Government must, therefore, focus its en- Mugaga also observed that the situation had “One of the difficulties (of the second na- CZI would also be engaging with the Industry and Com- ergy on clamping down on the real coronavirus been worsened by a “plethora” of tax heads that tional lockdown) is that the announcement was merce ministry, to get further clarity on the modalities and drivers, while relaxing controls to allow busi- had been mooted by Finance minister Mthuli made when a number of people were away and implementation of the lockdown. nesses to operate,” Ncube told The Financial Ncube in his last budget statement looking forward to starting work. “We are basically seeking a smooth implementation Gazette. “Those tax heads, notably the presumptive “The government could have given people at of the lockdown by way of effective communication and Chris Mugaga, the Zimbabwe National tax, can only help to empower an informal econ- least a week to prepare. There was need for a bit alignment across all stakeholders,” she said. Chamber of Commerce (ZNCC) chief execu- omy while appetising businesses to evade and of time for people to gain the momentum. Denford Mutashu, the Confederation of Zimbabwe Re- tive, also said the hard lockdown was not ideal avoid paying taxes,” he added. “You can imagine, for example, how many tailers (CZR) president, said while not pleasant, the lockdown was necessary “to stop a looming catastrophe” amid rising cases of Covid-19 in the country. “We are in an extraordinary situation which calls for extraordinary measures, including the discarding of the business-as-usual approach. “CZR calls upon its members to adhere to the new measures, which means opening and closing shops within the set timelines. CZR believes we will flatten the curve if we have all hands on deck,” he said. See also Pages 4 and 8 [email protected] UK offers firms £4,6 billion ritain offered a £4,6 billion support package for businesses on Tuesday to soften an expected reces- Bsion caused by a surge in Covid-19 cases that has triggered a third national lockdown. Prime Minister Boris Johnson announced the lockdown on Monday, saying a highly contagious coronavirus variant risked overwhelming the health service within 21 days. Most people must work from home and schools have closed for almost all pupils. Hospitality venues must stay shut, as well as non-essential shops. Britain’s economy looks likely to tip back into recession — shrinking in the final quarter of 2020 and the first quarter of 2021 — following a record 25 percent fall in output in the first two months of lockdown in 2020. The new downturn is expected to be far softer, with most businesses now much better adapted to working remotely and construction sites and factories expected to stay open. But economists at JP Morgan still predicted a 2,5 percent fall in output for the first three months of 2021. Finance minister Rishi Sunak has previously announced emergency help for the economy worth 280 billion pounds, including a massive job protection scheme that will run until the end of April. Under Tuesday’s additional measures, retail, hospitality and leisure companies will be able to claim one-off grants worth up to £9 000 to get them through the coming months, costing up to £4 billion in total, along with £600 million of grants for other businesses. “This will help businesses to get through the months ahead — and crucially it will help sustain jobs, so workers can be ready to return when they are able to reopen,” Sunak said. Government forecasters in November predicted almost £400 billion of borrowing this financial year, equivalent to 19 percent of GDP — a peacetime record but one that, at least for now, can be financed at record-low interest rates. The Bank of England is buying government debt and in November ramped up its asset purchase programme to almost 900 billion pounds with the intention of using it throughout 2021. However, the British Chambers of Commerce said Su- nak’s “drip-feed approach” to support for businesses would see many go to the wall as they would not qualify for sufficient assistance. “While this immediate cashflow support for business is welcome, it is not going to be enough to save many firms,” Adam Marshall, BCC director general said. The opposition Labour Party said millions of people had been let down by Sunak’s announcement. “Instead of delivering the support that Britain needed, he’s ploughing on with plans to hit people in their pock- ets with pay cuts, benefits cuts and tax rises,” its finance spokeswoman Anneliese Dodds said. The Organisation for Economic Cooperation and Development has estimated Britain’s economic recovery by the end of this year will be the slow- est of all its member countries except Argentina. — Reuters The Financial Gazette January 07-13 2021 | Page 3 National News Africa heralds onset of free-trade pact he first goods will begin to flow under an Africa-wide tion to 22 percent, and commerce within the con- free-trade pact on Friday, the culmination of more than tinent could rise to more than $231 billion even if Tfive years of negotiations on cutting cross-border tar- all other conditions remained unchanged, the Af- iffs. rican Export-Import Bank said in report published The accord comes to fruition at a time when trade ten- on December 15. sions are rising across much of the rest of the world. Internal shipments accounted for 52 percent of The 55-nation Africa Union marked the occasion in a cer- total trade in Asia and 72 percent in Europe, ac- emony that came just hours after the UK left the European cording to Afreximbank data. Union’s single market and a new post-Brexit trade agree- All but one of the 55 nations recognised by the ment entered into force. African Union have signed to join the area and It’s “a day in which we take Africa a step closer to a vision more than half have ratified the accord. of an integrated Africa, a vision of an integrated market on Eritrea, which has a largely closed economy, is the African continent,” Wamkele Mene, the secretary general the sole holdout. of the African Continental Free Trade Area, said during the The pact will help Africa to industrialise on event. a big scale, said President Nana Akufo-Addo of The treaty seeks to lower or eliminate cross-border tariffs Ghana, the host country of the bloc’s secretariat. on most goods, facilitate the movement of capital and people, The treaty seeks to lower or eliminate cross-border tariffs on most goods. All outstanding issues relating to the bloc’s promote investment and pave the way for a continent-wide various operation instruments, such as an on- customs union. The accord will assist the continent to recover ship. line platform for tariff negotiations and a digital The bloc has a potential market of 1,2 billion people with from the “devastating impact” of the coronavirus Intra-African trade fell to 14,5 percent of the payment and settlement system, would be final- a combined gross domestic product of $2,5 trillion, and could pandemic, said South Africa President Cyril Ra- total in 2019, from 15 percent the year before. ised and made operational by the end of March, be the world’s biggest free-trade zone by area when the treaty maphosa, who holds the AU’s rotating chairman- The free-trade pact could bolster the propor- Akufo-Addo said. becomes fully operational by 2030. [email protected] Scrap punitive tax — ZNCC Tendai Kamhungira Senior Staff Writer

HE Zimbabwe National Chamber of Com- merce (ZNCC) has demanded the scrapping Tof punitive taxes on business, as opposed to offering a stimulus package, saying it was evident that the government had no funds to bail out ailing companies. This comes as officials recently announced a strict 30-day lockdown aimed at curbing the spread of the Covid-19 pandemic, in a development economists have said will further negatively impact on businesses still struggling to get a piece of the $18 billion stimulus package promised by the government last year. “The stimulus cannot be expected when we know the fiscal status of the government is not healthy. The best stimulus at the moment must come from tax relief through reversing a number of tax measures in Finance minister Mthuli Ncube’s 2021 budget. We all know there is no fund to support ailing businesses. “This is also the best time to take heed of what business has been saying regarding the punitive two percent Intermediated Money Transfer Tax. "We insist it must be income deductible and not be applied the way it’s happening right now,” Chris Mugaga, ZNCC chief executive, said. The government recently introduced a two percent tax on foreign currency transactions backdated to August 1, 2020 under the new Finance Act on top of another controversial 2018 two percent levy on RTGS transactions, which was aimed at bringing the informal sector into the tax system. With business raising concerns over the punitive levy, which it claims amounts to double taxation, the situation was made worse by the pandemic, forcing the government to offer a stimulus package. However, business leaders recently told The Fi- nancial Gazette that the package was being sabotaged by the stringent access conditions attached to it. Although the government had released $2,5 billion for last year’s winter wheat, while further notify- ing the Bankers Association of Zimbabwe that it was ready to provide more guarantees for the recovery plan, business says Treasury’s obsession with balanc- ing its books and keeping money supply in check was inhibiting an optimal roll-out of the programme and faster resuscitation of the economy. Mugaga said there was need to put in place mitigatory measures to maintain stability, as the lockdown was going to hit business hard. He said a number of people were going to lose their jobs, as the lockdown will also negatively affect a number of companies’ export capacity. “It’s important for the government to consult before introducing such a Statutory Instrument giving effect to the recent lockdown measures. "If a friendly business climate is to be achieved, we need to nip in the bud this culture of guerilla an- nouncements where even the victims will only learn about their fate through pressers with no input from them whatsoever,” he said. [email protected] Page 4 | January 07-13 2021 The Financial Gazette National News Address land tenure: World Bank Farai Mabeza a need for a modern land registry. Zimbabwe Staff Writer currently uses a manual land administration system with high transaction costs and outdat- HE World Bank says Zimbabwe must ed procedures and has no comprehensive ca- urgently address its longstanding land daster in place. Ttenure challenges to attract investment A cadaster shows details of ownership, into the country’s agriculture sector. boundaries, and value of property. Surveying In a report titled Public Expenditure Review of A2 farms, which comprise the commercial with a Focus on Agriculture, the bank together farming sector, has been sporadic, resulting in with the government noted that improving se- high survey costs. curity of tenure would drive effi ciency in allo- “Improving the cadaster system by inte- cating land and improve credit markets. grating cost and effi cient systems for thorough “The decline in tenure security has led to land surveying and registering all types of ten- underutilisation of land, which has translat- ures is key,” the World Bank said. ed into reduced agricultural output, reduced “The government should adopt a digital supply of industrial feedstock, a decline in land information system that allows online agricultural exports, and fewer investments in access to records, maps, and other services. farm land. Again, although the Deeds Registry has high “Agriculture is likely to continue contrib- standards, it too is limited by an ineffi cient op- uting to severe macroeconomic dislocations erating system, as it is run manually without a unless the legacy of the early 2000s is ad- digital link to the cadaster”. dressed,” the report says. The report was prepared while Zimbabwe At the turn of the new millennium, Zim- was still working on the global compensation babwe conducted a fast-track land reform agreement with displaced commercial farmers programme, which saw white farmers being which was later agreed at US$3,5 billion to- kicked out from the country’s prime agricul- wards the end of last year. tural land. The new crop of indigenous black The World Bank report said resolving the farmers was then issued with 99-year leases in The report also pointed out that there was a need for a modern land registry. question of valuation and compensation would place of title deeds. reinstate security of tenure and give landhold- “Weak tenure security also means that ers the confi dence needed to make long-term banks are unwilling to lend to many farmers. World Bank noted. eral for loans from commercial banks…,” the investments and banks the confi dence to ac- Credit is important for agricultural productivi- “…there is need to allow the 99-year lease report says. cept 99-year leases. ty and is an important source of resilience,” the that has been introduced to be used as collat- The report also pointed out that there was newsdesk@fi ngaz.co.zw Atlas Mara secures new financing Covid-19: Second wave casts TLAS Mara has secured a US$26 million facility from a fund managed by UBS O'Connor LLC to fi nance its op- dark cloud over tourism A Farai Mabeza lus package but the Haz chief says his organisa- erating expenses and working capital requirements. Staff Writer tion’s membership has not been able to derive The group also entered into a standstill much joy from it. NCERTAINTY once again clouds the “Unfortunately, there has been a lack of agreement with some creditors in respect of tourism sector as the renewed Covid-19 clarity on the part of the process as to how our ABC Holdings (ABCH) fi nancing arrange- threat, characterised by a new variant membership can access the funding from their ments. U strain of the disease, has resulted in the return banks,” he said. This comes after the group is said to be in of strict travel restrictions locally and interna- Many people have already lost employment talks with Access Bank, which is interested in tionally. in the sector and analyst Tapiwanashe Mang- Atlas Mara’s businesses in Botswana, Zimba- Many countries, including Zimbabwe, are wiro said the government should help prevent bwe and Zambia. reintroducing tough movement restrictions fol- more job losses. Michael Wilkerson, Atlas Mara’s execu- lowing a spike in infections and deaths which “Occupancy rates will remain low. Govern- tive chair, said the facility was secured against have been attributed to the new strain of the ment needs to put in place measures to fi nan- shares and other assets owned by Atlas Mara virus. cially help the industry from further retrench- and its subsidiaries for a duration of 18 months. “The year 2021 remains shrouded in uncer- ing staff,” Mangwiro said. “The new fi nancing will be used to fund tainty as the world yet again grapples with the However, tourism retains hope for long-term Michael Wilkerson resurgence in Covid-19 and the fact that there revival and views the outbreak of Covid-19 as near-term operating expenses and working is also a new strain which is said to be more the ushering in of a new normal. capital requirements. It also will be used to Currency depreciation across African mar- contagious than the fi rst. “Covid-19 has caused fundamental chang- buy back from the lender 26,4 million shares kets in 2020 resulted in a US$150 million re- “While the fact that a vaccine is now in the es in the way people travel, meet and perceive at US$0,40 per share. duction in the US$ value of the group’s assets offi ng, it's generally accepted that its wide- health and safety issues and as such, the new “Amid the current challenging operating and thus a reduction in its debt-carrying capac- spread availability will take time,” Hospitali- normal is a reality that we have to live with as environment, we are pleased to have secured ity, while the economic challenges related to ty Association of Zimbabwe (Haz) president, a sector. new funding and obtained such high levels of the Covid-19 pandemic resulted in delays in Clive Chinwada, told The Financial Gazette. “There are, however, elements that will re- support from our convertible bondholders and the strategic fundraising initiative, which was Although local tourism sites and air travel main irreplaceable such as the yearning to visit bilateral lenders. paused as a result of tightening global liquid- remain open, domestic travel has been limited. and see new places as well as the desire and “The new facility and standstill agreement ity. The new restrictions come at a time the need to meet physically. will provide the time and stability necessary to “While the company has made signifi cant country’s tourism recovery plan, introduced af- "As such, once the vaccines become avail- enable the company to continue to pursue its progress in asset disposals as previously an- ter the easing of the initial lockdown, is still in able on a global scale, travel will surely re- its infancy. Chinwada expects the short to me- sume,” Chinwada said as he refl ected on the strategic options, including further asset sales, nounced, and continues to explore other po- dium term to be tough on hospitality services. year 2020. as well as a broader debt restructuring to re- tential transactions, the economic challenges “With the reintroduction of lockdown mea- “It was a very tough year. The industry align the balance sheet to prospects for value,” related to the Covid-19 pandemic resulted in sures and the increase in Covid-19 cases na- spent a big chunk of the year unable to trade Wilkerson said. delays in the strategic fundraising initiative, tionally, travel will once again be threatened due to lockdowns and restrictions in travel. In 2019, Atlas Mara traded off its opera- which was paused as a result of tightening and with travel limited, hotel occupancies "As a result, revenue surpassing US$1 bil- tions in Rwanda, Zambia and Mozambique to global liquidity,” Wilkerson said. and uptake of hospitality services will be con- lion has been lost. Jobs and household incomes Kenya’s Equity Bank, saying operations in the The company remains in discussion with strained in the short to medium-term,” Chin- suffered subsequently”. four markets contributed under two percent of some creditors not currently part of the stand- wada said. In 2019, Zimbabwe received US$1,25 bil- total group net income. But Atlas Mara kept still including other holders of the company's In its recovery plan, the government set up lion in tourism receipts, a 10 percent drop from the Zimbabwe operation, which it said re- convertible bonds and bilateral lenders to the a tourism relief fund in the form of a $500 mil- US$1,39 billion in tourism receipts generated mained solid despite a tough market. company and ABCH, in order to obtain their lion credit guarantee under the Covid-19 stimu- in 2018. newsdesk@fi ngaz.co.zw The new investment is expected to result in support. suffi cient net proceeds for the company's oper- “The agreements will support near-term ational liquidity needs through the target date stability to enable the company to continue for a comprehensive restructuring of the com- engagement with creditors, to achieve a company's and ABCH's debt obligations. prehensive recapitalisation or restructuring of The company expects to generate additional debt, to enable long-term stability and growth. liquidity from asset disposals to support me- "The company continues to carry out its dium-term operations, subject to discussions cost reduction programme, and remains on between the company and its creditors. track with its strategic repositioning, includ- These disposals come from a 2019 strategic ing asset disposals and other transactions." review, which focused on the fi rm's scale and — Staff Writer returning to profi tability. newsdesk@fi ngaz.co.zw The Financial Gazette January 07-13 2021 | Page 5 Page 6 | January 07-13 2021 The Financial Gazette National News ‘Zim needs more skilled personnel to fight graft’

Tendai Kamhungira Zimbabwe was “endemic and this ism minister, who was arrested in Senior Staff Writer poses challenges to the commission, July 2019 over a US$95 million which is arguably not independent”. National Social Security Authori- ACK of skilled investigators “Moreso, it should be noted that ty scandal, Obadiah Moyo, former and slow turnaround time of Zacc is not adequately resourced Health minister, who is accused of Lcorruption cases in the courts both financially and in terms of corruption involving US$60 million has reversed the Zimbabwe An- human resources. There are no for Covid-19 PPE procurement as ti-Corruption Commission (Zacc)’s skilled investigators within Zacc to well as Herbert Gomba, the former efforts to curb graft, despite regis- lead high levels of investigations Harare mayor, who is accused of tering fairly positive developments on complex issues such as money taking part in illegal land deals. in the past year, anti-corruption ex- laundering and fraud. The capacity Under her supervision, Zacc also perts have said. and the availability of resources and arrested former principal director of The anti-graft body — fighting independence of Zacc remain a let- State Residence Douglas Tapfuma to dispel a catch-and-release tag — down in the institutional response on criminal abuse of office allega- has been making strides in the right against corruption,” Mundopa said. tions, leading to his subsequent con- direction, arresting a sizeable num- The Judicial Service Commis- viction and jailing for four years. ber of notable figures, since the ap- sion (JSC) has established anti-cor- The commission also arrested pointment of the High Court judge ruption courts around the country’s Joram Gumbo, the Presidential Af- Loice Matanda-Moyo-led commis- provinces in a bid to ensure efficient fairs and Monitoring Implementa- sion in May 2019. and timeous handling of graft cases, tion of Government Programmes “The commission has attempted a development analysts have said minister in November 2019 on to investigate and respond to issues though positive, has failed to sig- criminal abuse of office charges. of corruption. Of concern howev- nificantly improve the situation. Gumbo was, however, immediate- er, has been the turnaround time of Corruption has become en- ly let go, with Zacc claiming to be concluding cases and reports of se- graved in the Zimbabwean soci- carrying out further investigations. lective investigation. ety, with the Financial Intelligence While trying hard to make a “To date the commission has in- Unit (FIU)’s 2019 report indicating mark, Zacc has been accused of be- vestigated over 70 high level cases, that nearly $1 billion per year was ing captured by certain individuals, most have not been concluded or laundered between 2014 and 2018, a claim the organisation vehemently they are still waiting for prosecu- while the African Forum and Net- denies. tion. The failure of the commission work on Debt and Development According to a recent opinion to register results is indicative of its estimated that between 2009 and paper by Gorden Moyo, the Pub- He said the TRACE Bribery Risk Ma- It further stated that it had filed High capacity in responding to corrup- 2013, the country lost US$2,83 bil- lic Policy and Research Institute of trix also placed Zimbabwe in the "high Court applications with a view to forfeit tion,” Muchaneta Mundopa, Trans- lion through illicit financial flows. Zimbabwe advisor, Zimbabwe is risk category", ranking it 180 out of 200 properties that are products of criminal parency International Zimbabwe Since Matanda-Moyo took of- viewed as one of the most corrupt surveyed countries, while the Financial activities, at the same time going after (TiZ) executive director, told The fice — to her credit — some offi- countries in Africa after it ranked Crime News ranked it 37 out of 100. judges and churches involved in illicit Financial Gazette. cials have tasted prison, including 158 out of 180 in the TiZ 2019 cor- Moyo said while corruption has deep- financial deals. Mundopa said that corruption in Prisca Mupfumira, the former Tour- ruption index. ened over the years, the general belief is Though credited with making mag- that prosecutions are politically-motivat- nificent strides, experts are still adamant ed and meant to please individuals in the that the major undoing of these efforts president Emmerson Mnangagwa-led has been a lack of experts in Zacc to administration. handle complicated cases of corruption, “For example, upon assuming pow- with a number of its investigators having er in November 2017, the ruling exec- no forensic expertise. utive-military alliance moved swiftly Last Mapuranga, a forensic expert, to arrest its political opponents, includ- said while Zacc has been moving in the ing former Finance minister Ignatius right direction, it needed to deal with a Chombo, former Mines minister Walter number of issues to achieve a 100 per- Chidhakwa, and the former minister of cent success rate. Information and Communication Tech- “I think the current commission has nology minister Supa Mandiwanzira, shown some tremendous achievements all of who were arrested on allegations compared to the previous commission. of criminal abuse of office while former "The previous commission did not Energy minister Samuel Undenge was have any meaningful conviction or any accused of prejudicing the Zimbabwe meaningful arrests, so they have moved Power Company (ZPC) of $12 650,” from zero to 10 … though it is not Moyo said, adding that similar prosecu- enough. Considering the rate of corrup- tions on Mnangagwa’s perceived allies, tion in this country, we should be having Mupfumira and Gumbo, are dragging convictions on a monthly or weekly ba- with “no indication that they will ever sis,” Mapuranga said. be punished and compelled to return the The Global Forensic Services found- stolen assets”. er said dealing with corruption required He said the main problem was the all hands on deck, especially from key lack of coordination and collaboration corruption busting institutions. between crime-busting organisations “There is supposed to be capacity such as the National Prosecuting Author- building of all judicial actors … these ity, the Zimbabwe Republic Police, the people need to be capacitated to avoid Special Anti-Corruption Unit and Zacc any professional barriers. If the commis- itself. sion is capacitated and the judiciary and Moyo said going forward, there will the NPA are not capacitated, it’s a recipe be a need for transparency and account- for disaster. ability on the government’s part, as well "Forensics is a multi-faceted disci- as putting in place mechanisms allowing pline, it involves law, accounting, audit- public participation to ensure that funds ing, intelligence, digital aspects, so these are not misappropriated. people need to be educated in these fields “… the enactment of a Whistleblow- if we are to break any of the barriers lim- ers Protection Act would create a wider iting the rate of convictions,” he said. protection for whistleblowers, which Mapuranga further said that there would in turn encourage whistle blowing was need for serious budgetary support and curb corruption and financial crime to revamp all the judicial actors’ syllabus in Zimbabwe. It is recommended that a and align it to the current technological bill is drafted and tabled in Parliament advancements and incorporate 21st cen- for consideration. Such an enactment tury criminal busting techniques, as well would be a noteworthy step in the fight as employ experts in certain complicated against corruption in the country,” he fields. said. He also said that there was a need for Early last year, Zacc said it had iden- a professional supervision mechanism tified US$7 billion worth of properties to weed out corrupt officials within the stashed outside the country, while re- rank and file of all key judicial institu- cently stating that it had also recovered tions. property worth US$5 million and 501 [email protected] cars. The Financial Gazette January 07-13 2021 | Page 7 News Top work-from-home trends of 2020

fter millions of Americans moved to work from resumes. As most companies moved online, telework- are a sufficient replacement for in-person con- the office to working remotely, working from home The transition from office attire, in-person ers have relied heavily on video conferencing tact. Ahas undergone the largest test trial to date. meetings and lengthy commutes to pajamas and and instant messaging to stay in touch with Not everyone can work from home Even though many employers are set to reopen offices Zoom conferences has been relatively seamless co-workers. Not all employed adults have the option of in 2021, it has been proven that telework is plausible, and for most employed adults. A forever poster child for 2020, Zoom quick- working from home, according to the Pew Sur- many companies will allow for a hybrid model of home According to the Pew survey, of those work- ly turned into not only the most downloaded Ap- vey. and office work moving forward. ing from home all or most of the time, nearly ple app of the year but also a verb. Even during the pandemic, a majority of The future of the workplace could be changed perma- three-quarters have been equipped with the ade- In fact, 81 percent of employed adults work- workers in industries like health care, retail and nently, molded by trends of the grand remote work experi- quate technology and resources to do their jobs, ing from home all or most of the time say that manufacturing cannot logistically be out of the ment amid the pandemic. meet project deadlines and feel motivated. they use video calling or platforms like Zoom at office. Here are some of the top work from home trends that Despite the cited perks of having flexibility, least some of the time, while over half, or 59 per- While a person’s ability to work from home have defined 2020: a majority of respondents say that they feel un- cent, say that they use these often. hinges on their vocation, a class divide also ex- More than half of employees say they comfortable returning to the office once employ- Another 57 percent of respondents use mes- ists. want remote work to stay ers start rolling out vaccination plans. saging platforms like Slack or Google Chat. Sixty-two percent of employees with a bach- A recent Pew survey found that most employees who Sixty-four percent of those working from The frequency of virtual meetings has even elor’s degree or higher say that their business are working from home had rarely or never teleworked pri- home now report that they would feel uncom- dubbed the new term “resting Zoom face.” cannot be done from home, compared with only or to the pandemic. In fact, only one-in-five worked from fortable returning to the office, with 31 percent However, more than half of those using video 23 percent of those without a four-year degree. home all or most of the time. of respondents saying they would feel very un- conferencing services, or 63 percent, often are Meanwhile, most employees with a While 71 percent of those employees have reported do- comfortable. not experiencing “Zoom fatigue.” higher level of education and earning lev- ing their job from home now, over half say that they would Slack, Zoom and video conferencing services Overall, the Pew Research data reveals that el are more likely to work from home. want to keep doing their job from home even as office life are top communication tools communication services like Zoom and Slack — foxnews

HCZ goes after Nssa's foreign assets OUSING Corporation Zimbabwe (HCZ) has de- cided to go after the National Social Security Au- Hthority (Nssa)’s offshore assets by making an application to freeze its US$20 million deposit in a Mauritian bank and as part of efforts to enforce its arbitral award. This comes as the compulsory pension fund has lost its High Court bid to overturn Peter Lloyd’s February 2019 award to the former and in a development is likely to present some headaches for the authority’s new general manager Arthur Manase — an ex-Reserve Bank of Zimbabwe senior staffer, and lawyer himself. “…the only asset that Nssa possesses in Mauritius con- stitute of deposit receipts of African Export Import Bank, which are valued at around US$20 million. These deposit receipts are traded on the Mauritius Stock Exchange and acquired through SBM," HCZ lawyer Dya Ghose Radha- keesoon said in a December 17 affidavit to the Mauritian Supreme Court and which document forms a set of papers served on Nssa this week. “However, Nssa has recently disposed of these shares. HCZ fears that Nssa is purposely rapidly disposing of its assets... in order to frustrate the rights of HCZ to enforce the awards against its assets..," she said. While Stephen Duggan's company has been bouyed by Justice Paul Msithu's February 2020 ruling the parastatal must pay the private developer US$22 million and its quest to register the arbitral award must succeed, the off-shore application was also motivated by the fact the real estate firm was 85 percent-owned by Mauritian-based Housing Corporation Africa. Further, HCZ says it was entitled to executing such an application under international law and specifically section 23 of the International Arbitration Act. “It is hereby ordered that an interim order ... prohibit- ing, the respondent (Nssa),.. from trading, transferring... and disposing... of its interest... in the depository receipts of US$20 million issued by African Export-Import Bank... and acquired through the co-respondent SBM Bank..,” read a December 22 injunction disposed by justice Aruna Devi Narain. "HCZ aver that there is a real risk that Nssa will dis- pose of these securities in Mauritius... or anywhere else so as to jeopardise the rights of HCZ in enforcing the awards against the assets of Nssa pending the appeal before the Supreme Court of Zimbabwe and... that order... rendering executory the awards in Mauritius," the urgent papers said. And in the recent order, the Mauritian Narain further barred Nssa from acting in any manner which may disrupt any stage of the arbitration proceedings to enforce and ex- ecute the award. According to Narain, the order will be in force until March 2 when the parties "are again expected to appear before a three-member judges panel to show cause why this interim directive should not be enlarged, dis- charged or otherwise dealt with after hearing both parties”. The interim order comes as Nssa recently filed a Su- preme Court appeal challenging Msithu's judgment di- recting it to pay billions to Duggan's company following a disputed US$300 million housing deal. And HCZ feels the compulsory pension fund is engaging in delaying tactics in its bid to frustrate the housing developer, whose associates have successfully launched another low-cost venture . The legal battles between Nssa, and the private firm arose after the two entered into an off-take agreement in 2017 under which the former was to acquire 8 000 housing units from the foreign-backed developer. But having disputed breaching their 2015- 17 agreements, Manase's firm lost the arbitration and court proceedings. — Staff Writer [email protected] Page 8 | January 07-13 2021 The Financial Gazette Leader Page

News Worth Knowing Covid-19: Govt must strike the right balance

N addition to Saturday's lockdown announcement, the year has started on a sad note with an increase in fuel prices, which Iwill certainly undermine government efforts to turn around the economy. But what could be comforting this time around is the fact that the price hikes are in line with the international price of crude oil, which is now above $50 a barrel. Even neighbouring South Africa has adjusted its pump price for the precious liquid. Prices ended 2020 about 20 percent below 2019's average, still recovering from the impact of global economic lockdown measures The new TN Asset Management’s head offices along Glenara Road in Highlands, Harare. Owned by businessman and imposed to battle Covid-19 that slashed fuel demand. top lawyer Tawanda Nyambirai, TN Asset Management is one of the top investment managers in the country. While fuel supply has remained largely stable over the past few months, there is no running away from the fact that the country’s economy is in a fragile state, and any such movement could have ripple effects. 2021 outlook — A quick recovery Thus, the latest policy moves risk undermining confidence in Harare's ability to maintain the current trend of exchange rate but a slew of new economic problems and inflation stability. s 2020 passes like a bad dream China tariffs in place — at least initial- the EU secured an eleventh-hour trade Apart from the numerous internal factors such as the propensity and Covid-19 vaccines are dis- ly. If Trump’s rise was fueled in part deal governing their future relationship; to spend beyond its means, corruption and flagrant wastefulness, Atributed en masse, many econ- by the income inequality that worsened the pact calls for no tariffs or quotas on the economy still has to deal with issues such as Covid-19 and ex- omists believe that the global economic after the last recession in 2008-2009, goods, and British Prime Minister Boris treme weather phenomenon. recovery in 2021 could prove the fastest when Wall Street was bailed out while Johnson declared it a big victory. in decades. middle-class homeowners were not, But the long-delayed Brexit agree- Just last week, the country escaped a potentially devastating But the pandemic, and associated then continued inability to fix those ment, which was approved overwhelm- Cyclone Chalane, which was eventually downgraded to a tropical lockdowns, will leave a grim legacy problems spells political trouble — es- ingly by Parliament on December 30, storm. We have barely recovered from Cyclone Idai — more than that could also take decades to over- pecially in the wake of unprecedented doesn’t appear to cover services such a year later, some roads are still impassable and thousands are still come, not least the worsening income economic turmoil during the pandemic. as finance, which account for the vast homeless. inequality that will likely only rein- “The pandemic and recent recession majority of Britain’s flagging economy flame populist politics in the United made the problem worse,” said Mark and most of its trade with the EU. Nor After taunting the pandemic that it had not done much damage, States and other major nations. Gertler, an economist at New York Uni- will British citizens enjoy their previous the second wave of the outbreak is proving to be more lethal and And even the election of Joe Biden versity. Those employed in white-collar rights to live and work in the EU. And highly contagious, and again like sitting ducks, we are caught with- as the next US president, an avowed in- jobs, like in the already high-paying the EU still has lingering trade and eco- out a comprehensive plan. ternationalist, won’t be enough to parry tech sector, made out fairly well, while nomic policy fights with Washington Again, the authorities in typical fashion have rushed to an- the structural threats that still plague the low-income workers, especially in ser- that won’t be solved by a magic wand economies of the US and other devel- vice industries, took the worst hits. from Biden. nounce another lockdown which clearly was not well thought-out. oped nations. The 74 million Ameri- Though department and food stores “It would be a far cry for either the The messaging would be very comical had the consequences not cans who voted for Donald Trump and remained open for the most part, other EU or the UK to think they have a very been disastrous. the protectionist, neonationalist policies retail, food services, hospitality, enter- special relationship with Biden,” said Since Monday, the police have issued separate conflicting state- they both embraced aren’t going away tainment, and leisure industries took the James, who specialises in trans-Atlantic ments regarding the lockdown measures no one really seems to — and neither are the serious social and biggest blow, affecting a much larger relations. Europeans who saw US pol- economic problems that underlay them. fraction of the already suffering middle icy upended in its entirety in Trump’s know how this will be implemented. The impact on business will After a dismal year in which nearly class, many of whom are also struggling first term now know how short-lived obviously be dire, yet the Treasury is still pussyfooting about its every major economy contracted— with higher health insurance costs. the promises of even a committed inter- stimulus package. with the apparent lone exception of In a recent report, the Massachusetts nationalist can be — and they have 74 While we value life, we urge authorities to go about this in a China — most economists expect 2021 Institute of Technology economists Da- million reminders of the possibility of measured and calculated manner which will also safeguard liveli- to bring growth back in spades. Ac- vid Autor and Elisabeth Reynolds con- more whiplash in the near future. And cording to the International Monetary clude that the Covid-19 crisis “will ex- no matter how much Biden wants to hoods. Fund, global growth is projected at 5,2 acerbate economic pain in the short and court, rather than clobber, Europe when percent this year. Other economists ex- medium terms for the least economical- it comes to trade disputes, Brussels sim- pect the strongest performers this year ly secure workers in our economy, par- ply has different priorities. to be those countries that did severe ticularly those in the rapidly growing And there’s another scary economic lockdowns in 2020, led by the United but never-highly-paid services sector.” legacy of the pandemic that could pose EDITORIAL MARKETING Kingdom and Spain. China, for its part, a huge challenge for Biden going for- already returned to economic growth ward. Months of virtual work during Advertising Manager last year and is forecast to enjoy a return Open Forum the pandemic have started to alter la- to moderately strong GDP growth this bour patterns, which will ultimately Deputy Editor Brand Executive Sales & Advertising year. with have a disproportionate impact on the Senior Assistant Editor In the US, after a devastating sum Senior Sales Consultant - already struggling working classes. mer, the projections are for a big re- Michael Hirsh “There are going to be some signifi- Markets Editor Senior Sales Executives bound. “I assume that if vaccination cant shifts in where the jobs are,” Wen- does not get screwed up or slowed dy Edelberg, a former chief economist Companies Editor down, we are going to have a substan- Thus, rather than promising a major at the Congressional Budget Office, Sales Representatives - Harare tial economic recovery,” said Andrei boom following the Covid-19 reces- said Group Digital Editor Shleifer, a leading economist at Har- sion, “the economy may be too side- “We’re not going to unlearn all the vard University. ways to fully recover,” Gertler said. new ways of doing business after the Chief Sub Editor Sales Representative - Bulawayo The fact is Biden likely won’t be “We’re still 10 million down in jobs and pandemic. There will be a lot more re- Clever Pedzisai: [email protected] able to do too much more — both be- without an immediate new stimulus.” mote work, a lot less business travel, Staff Writers Brand Executive - Events cause of the potential of Republican In Europe, the picture is much the and there will probably be much more obstructionism and the evolution in his same. Granted, the European Central automation in different sectors.” Brand Executive - Subscriptions own economic thinking since his days Bank and the European Union rushed Or as Oxford Economics wrote in Farai Mabeza: mabezaf@ﬁngaz.co.zw as Barack Obama’s vice president. to put together a massive rescue pack- another recent report: “The trauma of Senior Photographer Subscriptions Representatives But even if Biden has a relatively age early on, passing a hefty new EU lockdowns may encourage firms to free hand, the incoming administration budget that eased the immediate eco- adopt more labour-saving technologies Production Supervisor has already signaled that it is not going nomic threat and helped bridge the gap to limit any future disruption from so- to simply return to the centrist, un- between Northern and Southern Eu- cial distancing.” abashedly pro-free trade policies of past rope. But the second wave of the pan- That includes, for example, more Democratic presidents. A once highly demic, including a fresh round of lock- automatic checkout machines in stores regarded trade pact like the 12-nation downs, closed businesses, and growing and other retail businesses — expedit- Trans-Pacific Partnership, which many unemployment, spells similar problems ing the need for millions of workers to economists viewed as a much more as in the US. shift into new sectors. effective way to pressure China than “The EU has had a rather good That, in turn, will create the need Trump’s trade war, may no longer be year compared to the US Even so, the for big federally funded retraining pro- salvageable in the US. (It continues as second spike of the pandemic has not grams—just the thing that has been con- a smaller, 11-nation pact without Wash- been handled very well, with more spicuously missing in recent decades VOLUNTARY MEDIA COUNCIL OF ZIMBABWE ington’s involvement.) unrest and resentment,” said Harold when both Democrats and Republicans The Financial Gazette newspaper subscribes to a Code of Conduct that promotes truthful, accurate, fair and balanced news reporting. If we do not meet these standards, register your complaints with the Voluntary Media Council of And Biden has also indicated sup- James, a political economist at Princ- underestimated the devastating effects Zimbabwe at: port for protectionist measures like eton University. And that’s not even of globalisation and technological ad- No 34 Colenbrander Rd, Milton Park, Harare. Telephone: 04-778096 / 778006 24 Hr Complaints line: 0772 125 659 “Buy American” legislation and hinted counting the disruption from Brexit. As vances on the industrial working class. Email: [email protected] or [email protected] Twitter: @vmcz http://www.vmcz.co.zw | Facebook page: vmcz Zimbabwe he would be willing to keep Trump’s December came to a close, the UK and — foreignpolicy.com The Financial Gazette January 07-13 2021 | Page 9 Page 10 | January 07-13 2021 The Financial Gazette Advertorial IPMZ honours HR practitioners HE IPMZ Human Resources Excellence Awards serve the award. are meant to celebrate the profession by awarding Top three is then selected leading to this night. Tthose who would have excelled in the prior year. The awards night was held on December 11, 2020 at HR Excellence Awards celebrates excellency and in- Rainbow Towers Hotel. novation across the human resources function within the This year there were five categories in the individual business spectrum. cluster and eight categories in the organisational cluster. They recognise organisations and people who have Some of the awards include HR Director of the Year, pushed their business growth agenda through the suc- Upcoming HR practitioner of the year, People Develop- cessful implementation of their human capital. ment Award, CEO with an HR Orientation and Diversity This is the fourth edition of holding these awards. and Inclusion award. An independent research company is selected to con- Well done to those who have won this year. Continue duct the research using a mutually agreed set criteria. excelling. We also challenge those who have not won to A nationwide survey is done to all IPMZ members in keep pushing for excellence. good standing. IPMZ products Members chose both individuals and organisations IPMZ offer a Diploma in Human Resources Manage- that excelled in that year. ment (HRM), Diploma in Human Resources Develop- The five top shortlisted are then sent to an indepen- ment (HRD), Diploma in Labour Relations (LR) and a dent adjudication committee who also do their rigorous Higher Diploma in Human Resources Management with due diligence. a practical focus. This will include asking for citations from the short- Philemon Chitagu IPMZ president following proceedings at the HR These diplomas are accredited with the Ministry of listed candidates justifying why they believe they de- Excellence Awards recently. Higher and Tertiary Education. Each Diploma takes approximately 18 months of part-time study and also 6 months attachment. After successful completion of a series of assign- ments and three-hour examinations, candidates receive IPMZ Diplomas. The entry requirements are 5 “O”-Levels including English and graduates in HR are also encouraged to acquire this professional qualification and exemptions are granted subject to specific applications. SME’s, corporates, consultants can also take up the corporate membership with the institute and enjoy the many benefits in this category. Please contact [email protected] for more information. IPMZ also offers workshops and conferences for the purpose of continuing professional development, to re- fresh skills and update people on developments in the field of Human Resources. IPMZ also runs short courses to address HR training needs in different organisations. These include Industrial Relations, Discipline Man- agement, Supervisory Management, HR for non-HR, The Contract of Employment, Workers Committee Training and Compensation among others. These courses are run both as public workshops and in-house training. For training inquiries please contact bde@ipmz. co.zw Benefits of being an IPMZ member The Institute of People Management of Zimbabwe exists to ensure continuous learning and development of the HR profession. As the motto says, “The value of membership is priceless”. Among the benefits of being a member are: ●Professional affiliation and recognition- most employers recognize the IPMZ diplomas as a requisite qualification for HR people. ●Member discounts — on attending premier events like the conventions, workshops and other networking forums arranged or endorsed by the institute. ● Members benefit by getting the opportunity to learn from experts and share knowledge. ●Professional networking opportunities — the chance to exchange ideas and knowledge with peers in the industry. ●Attachment and mentoring — members get a chance to be mentored by experts in HR thereby expanding their professional development. Attachments are sought from a wide membership database. ●Personal development through continuous professional development. Contact IPMZ on 0242-700712/14/20; email informa- [email protected] or our website on www.ipmz.org. zw for more information. The National Office is at 15 Argyle road, Avondale, Harare.

Fortunate Sekeso, IPMZ executive director January 07-13 2021 Page 11 The Financial Gazette Companies&Markets BRIEFS ‘American dollar electricity ZSE posts record gains in 2020 HE Zimbabwe Stock Exchange (ZSE) posted record gains in 2020, with the benchmark All Share Index payments stir controversy’ Tclimbing 1 045,84 percent to close the year at 2 636,34 points. The market’s capitalisation grew by 968 percent to $317,9 HILE the Zimbabwe Electricity billion during the year. Transmission and Distribution This means the equities market, which was valued at WCompany’s (ZETDC) decision to US$1,77 billion using an official exchange rate of 16,77 at allow payment of bills in US dollars could the end of 2019, closed the year up 115,5 percent to US$3,88 improve its liquidity, it undermines the gov- billion using the current official exchange rate of 82. ernment’s efforts to promote the country’s Analysts, however, say there is room for more gains as the domestic currency, analysts have said. market is still “undervalued”. The state power utility recently intro- The gains seen on the exchange during the year were driv- duced a system that allows both pre-paid en mostly by the country’s high inflation, which reached 700 and postpaid customers to settle their bills in percent in June. — Staff Writer foreign currency at the prevailing exchange rate. Gift Mugano, a local economist, said the Gold nears eight-week high move, together with similar developments at other state entities including the Zimba- OLD this week traded near an eight-week high as a bwe National Roads Authority, “presents surge in global coronavirus cases and curbs stoked a dilemma for the government, which is demand for the haven, which has been supported by trying to promote the use of the Zimbabwe G lower US real yields, a weaker dollar, and slumping equities. dollar”. Bullion has made a strong start to the new year, with the “The government’s desired outcome is to variant strain of the coronavirus first identified in the UK now restore the local unit as the main currency found in New York State. because it makes it easier for the authorities UK Prime Minister Boris Johnson ordered a lockdown in and the country to operate. The Zimbabwe England starting from Monday night until mid-February. dollar is competitive and available, but we Global coronavirus infections climbed above 85 million, seem to be moving in the opposite direc- after daily cases in the US soared to a record of nearly 300 tion,” Mugano told The Financial Gazette 000. this week. Gold’s climb builds on the precious metal’s biggest annual “I would expect to see the private sector gain in a decade, as virus angst clouds the outlook for the leading the way in accepting the US$ and recovery. the government leading the way in accept- The spread of Covid-19 throughout the festive period and ing the Zimbabwe dollar,” he said. tighter restrictions will have a significant toll on the economy, From ZETDC’s perspective, Mugano, albeit one that’s consigned mostly to the first quarter thanks however, said the move could alleviate the to vaccines, according to Craig Erlam, senior market analyst power importation challenges that the com- at Oanda Corp. — Bloomberg pany has faced in the past. The southern African nation reintro- duced the local unit in June 2019 after a decade under a multicurrency system. Pula reconfigured for devaluation Authorities had banned the use of for- OTSWANA has set its pula currency to lose value at a fast- eign currencies in domestic transactions, but er rate this year, a senior official said Monday, as it seeks this was reversed in March last year when to boost export competitiveness after the Covid-19 pan- the Covid-19 pandemic hit. B demic has had a deep impact on diamond sales that are central to On his part, Prosper Chitambara, anoth- its economy. er economist, said the move could decision In the biggest shift for many years, the government has set ZETDC’s foreign currency challenges. LONDON’S financial sector started to feel the full effects of Brexit on the first the pula to lose 2,87 percent this year from 1,51 percent in 2020. “This can be a good way of mopping up trading day of 2021 as nearly €6 billion of European Union share dealing shift- Already in 2020, the rate marked a big change from previous the foreign currency that is widely available ed from the city to facilities in European capitals. For decades, trading systems years when the adjustment was less than one percent. in the market and it entrenches the dual cur- and big investment banks based in the English capital have been at the heart of Botswana uses a crawling band exchange rate regime under rency framework that we are in,” Chitam- cross-border share trading. Pic: Financial Times which the pula is pegged to a basket of currencies, including the bara said. South African rand. This comes as a number of companies, Its value is adjusted upwards or downwards at the beginning including British American Tobacco and facing. reported that it is owed about $5,6 billion in of each year using a rate of crawl that factors in the inflation dif- Delta Corporation, have said improved Since the weekly foreign currency auc- both local and foreign currency. ferential between Botswana and major trading partners. access to foreign currency through the Re- tions were introduced in June, the Zimbabwe This has seen the utility struggling to ser- The currency basket was kept at 45 percent to the rand and 55 serve Bank of Zimbabwe (RBZ)’s weekly dollar’s wild fluctuations have also marked- vice its debts, particularly with foreign utili- percent to the IMF’s special drawing right currencies. — Reuters auctions had eased challenges they were ly gone down. It also comes as ZETDC has ties. - Staff Writer [email protected] Page 12 | January 07-13 2021 The Financial Gazette Companies & Markets Cassava regains lost ground ASSAVA Smartech Zimbabwe (Cassava) says of the second wave,” the company said. a stable economic environment in Zimbabwe According to the trading update, active subscribers Cduring the third quarter of 2020 resulted in a declined by six percent between the second quarter and steady recovery across its operations. third quarter. The group’s trading update for the quarter ended No- During the period under review, the company also vember 30, 2020, shows that EcoCash’s revenues grew launched a self-registration USSD platform, which saw by 29 percent from the previous quarter on the back of a significant uptake in the number of new customer sub- a tariff review. scriptions. The group’s banking services revenue was up 81 per- Mobile banking customers increased by five percent, cent, underpinned by a 166 percent growth in interest “reflecting a comeback in customer activity”. earning assets, while insurtechs revenue increased by The company said the growth in the insurtech busi- 131 percent. ness was driven by an upsurge in short-term insurance, The company said it was optimistic that the positive which registered a 165 percent increase. economic trajectory will sustain the continued recovery “This was also driven by the company's high end of its operations into the near future. comprehensive diverse product portfolio which spans “The relaxation of Covid-19 lockdown conditions across all industry segments with a specific focus on locally and across the world saw relatively increased agriculture. activity across most sectors of the business.” “The life business recorded a decline in terms of EcoCash revenues grew 29 percent. The country has, however, seen an increase in new policies underwriting following the suspension of some and active cases, which has prompted government to down. from the first wave of the pandemic will EcoCash services for premium payments by community introduce tighter regulations under a phase four lock- “We are confident the lessons learnt assist us to better respond to the impact groups,” the company said. — Staff Writer

Muchadeyi Masunda BNC sales volumes dip Nelson Gahadza Staff Writer

INDURA Nickel Corporation (BNC)’s sales volumes declined by 15 percent to 2 566 tonnes Bduring the six months to September 30, 2020 after it suffered a temporary distribution stoppage. Muchadeyi Masunda, BNC’s board chairman, said the stoppage in sales was caused by the termination of the company’s off-take agreement with Glencore. “The 15 percent reduction in sales volume was main- ly due to the temporary stoppage in dispatches to the market during the period April to June 2020, a transition which the company had to go through while new marketing arrangements were being put in place following the termination of the Glencore off-take agreement,” he said. BNC in 2011, signed a nickel off-take agreement with Glencore, the world's biggest commodities trader, covering all the nickel concentrate that was to be produced following the restart of operations at Trojan mine in 2012. The company, however, has since secured a nickel in concentrate sales contract with ZOPCO. The total mate- rial dispatched to ZOPCO up to September 30, 2020 was 22 020 wet metric tonnes of concentrate. The group’s turnover for the period of US$25 million was 12 percent lower than the US$28 million realised in the prior comparative period. During the period under review, the London Metal Exchange (LME) nickel price averaged US$13 214 per tonne, compared to US$13 927 per tonne in the prior year. Masunda said the company has adopted a high volume, low grade operation strategy which enables the company to exploit the predominantly low-grade resource, subject to nickel prices remaining above US$13 000 per tonne. He said this will see the company fully utilising the installed processing capacity of the Trojan concentra- tor of one million tonnes per annum. The group spent US$1,6 million on capital expenditure. In terms of production, ore mined during the period under review was 207 747 tonnes compared to 215 338 tonnes mined in the prior comparative period. Ore milled was 209 153 tonnes compared to 215 728 tonnes in previous period. The company achieved a head grade of 1,62 percent, which was slightly higher than the 1,58 percent achieved in the same period last year. [email protected] The Financial Gazette January 07-13 2021 | Page 13 Companies & Markets BAT returns to ZSE top 10 Omega Ukama now turned its focus towards domestic tourism amid subdued Companies Editor bookings. CBZ Holdings, Cassava Smartech Zimbabwe, Delta, RITISH American Tobacco (BAT) has returned to Econet Wireless Zimbabwe, Fbc Holdings, Innscor Africa, the Zimbabwe Stock Exchange’s (ZSE) top 10 after OK Zimbabwe and Padenga Holdings complete the updated Bgaining 144 percent during the fourth quarter of 2020. list of the Top 10 Index’s constituents, which will be next re- The cigarettes manufacturer had fallen off the heavies list viewed on March 31. at the beginning of October, when the exchange last reviewed A stock market index is an aggregate value produced by the constituents of the Index. combining several counters and expressing their total values The latest review on January 01 has also seen Hippo Val- against a base value from a specifi c date. ley Estates (Hippo) joining the heavyweights, while SeedCo Market indexes are intended to represent a segment of the and Rainbow Tourism Group (RTG) have fallen off the list. market or an entire stock market and thus can help investors Hippo gained 536 percent during the fourth quarter of for the quarter, but since the weekly foreign Meanwhile, Hippo has lately seen in- track the market’s changes over time. 2020, while SeedCo gained only 29 percent and RTG lost currency auctions were introduced in June, creased exports buoyed by the growth of its The local bourse introduced the Top 10 Index at the begin- 15 percent. the Zimbabwe dollar’s wild fl uctuations market share in Kenya. The sugar processor ning of 2018 at a base of 100 points. As at close of trading on During the quarter, BAT said the Reserve Bank of Zim- have markedly gone down, while some ma- reported a 120 percent increase in export December 31, 2020, the index had reached 1 671,47 points. babwe (RBZ)’s currency auctions had eased some challenges It comes as the stock market has lately seen ral- jor enterprises that include Delta Corporation sales to 32 080 tonnes during the quarter end- The Financial Gazette @FingazLive it was facing and therefore, expected a decent performance (Delta) and United Refi neries, have also ed June 30, 2020. On the other hand, travel lies driven by infl ation, with investors seeking refuge in during the three-month period. reported that access to foreign currency has restrictions due to the Covid-19 pandemic real assets such as property and stocks. — Staff Writer The tobacco processor is yet to publish a trading update improved. Tahave negativelyx affectedR RTG, which hase T v a i x e newsdesk@fiRw ngaz.co.zwe view BreakfaBsrte 2a0k1f8ast 2018 Blanket Mine FINANCIAL FINANCIAL INVESTMENT/ GAZETTE INVESTMENT/ GAZETTE “Taxation under“T a axADMISSIONation FEE SUBSCRIBERSunder$900 a ADMISSION FEE SUBSCRIBERS $900 Caledonia $100 $85 TABLE $100 $85 TABLE New Dispensation”New DispensaPER PERSON PER PERSONtion” PER PERSON PER PERSON announces OF 10 OF 10 Guest Panelist Guest Panelist dividend Topic: Topic: Towards Towards Domestic Domestic increase Resource Resource Mobilization Mobilization IMBABWE-FOCUSED gold miner, Caledonia GUEST OF HONOUR GUEST OF HONOUR Mining Corporation (Caledonia), has declared an Faith Mazani Faith Mazani Zincreased quarterly dividend of US$0,11 follow- Zimra Commissioner General Zimra Commissioner General ing its continued strong fi nancial and operating performance. This marks a 10 percent increase from the previous quarterly dividend of US$0,10 paid in October 2020, and is a 60 percent cumulative increase from 6,87 cents since October 2019. The company, which operates a single asset — Blan- Tax Matrix REIZ President Tax Matrix REIZ President ket Mine — said increasing production, a high gold Marvellous Tapera Mike Juru Marvellous Tapera Mike Juru Topic: An overview of Property Industry tax Topic: An overview of Property Industry tax price and good cost controls have continued to result in Challenges and proposed reforms. Challenges and proposed reforms. increased cash generation, which has given the board confi dence that the business can sustain a higher level of dividend distributions before the benefi ts of central shaft are realised. “We are pleased to announce an additional 10 percent increase in our quarterly dividend, the fourth increase in the past 15 months representing a cumulative 60 percent Tax Partner Grant Thornton CZI Vice President Tax Partner Grant Thornton CZI Vice President rise in the dividend since the fi rst increase in October Christina Muzerengi Henry Ruzvidzo Christina Muzerengi Henry Ruzvidzo Topic: An overview of corporate tax Topic: An overview of Manufacturing Topic: An overview of corporate tax Topic: An overview of Manufacturing 2019. challenges and proposed reforms Industry tax challenges and proposed challenges and proposed reforms Industry tax challenges and proposed “The decision by the board to increase the dividend under a new dispensation. reforms under a new dispensation. under a new dispensation. reforms under a new dispensation. refl ects our continued and increasing confi dence in the outlook for our business. As we reported in our third quarter 2020 results, the business continues to perform well supported by strong production and a fi rm gold price,” Steve Curtis, Caledonia chief executive, said. - 11 October 2018- 11 - October 2018 - The mining company recorded a gross profi t of US$12,5 million in the third quarter of the year 2020, Venue: Rainbow Towers Hotel,V Hararenue: eRainbowEconomist Towers Hotel,Columbus Harar DDB e Economist Columbus DDB Dr Gift Mugano Barry Manandi Dr Gift Mugano Barry Manandi a 47 percent increase on the US$8,5 million gross profi t Topic: Implication of fiscal monetary Master of Ceremony (MC) Topic: Implication of fiscal monetary Master of Ceremony (MC) for the corresponding period of 2019 Time: 07:00 - 11:00hrs Time: measures07:00 on the economy - . 11:00hrs measures on the economy. “As we approach the end of the six-year investment Subscribe Now programme at Blanket Mine, we expect the combination of rising production and declining capital investment over the next two years will give us the scope to con- Event Partnership OpporEtunitiesvent Par Atnvailaershipble Opportunities Available sider further increases in the dividend in addition to providing funding for investment in new projects, including the exploration prospects at Glen Hume and Connemara #GetInvolved #GetInvolved North as announced on 10 and 17 December 2020, respectively.” For registration Contact - Kerina: 0777 489 645 or Email:F orkchiz regisemo@fingaz.tration Contactco.zw - Kerina: 0777 489 645 or Email: kchizemo@fingaz.co.zw The central shaft is scheduled to be commissioned T: +263 (242) 781 571/7 | 2nd Floor, Green Bridge SouthT :Eas +26tgat3 (2e42) Comple 781 5x,71/ Har7 ar | e2nd, Zimbab Floor,w Gre een Bridge South Eastgate Complex, Harare, Zimbabwe during the fi rst quarter of 2021, with production targets of 61 000 to 67 000 ounces of gold in 2021. www.fingaz.co.zw The Financial Gazette www@FingazLi.fingaz.co.zwve The Financial Gazette @FingazLive — Staff Writer newsdesk@fi ngaz.co.zw Page 14 | January 07-13 2021 The Financial Gazette Companies & Markets Foreigners sell off $5,4bln shares OREIGN investors were net starting in June — when the govern- omy remains in a tailspin. The allure nancial Gazette that there has been “a sellers of shares worth $5,43 ment introduced a currency auction of cheap assets is negated by escalat- flurry of selling activity” on the ZSE Fbillion on the Zimbabwe Stock system — there has been a marked ed volatility, which makes it difficult since it reopened after the “unprece- Exchange (ZSE) in 2020, official data increase in foreign sell-offs. to ascertain the turning point in Zim- dented closure”, with foreign inves- shows. “Since the restoration of the in- babwe’s economic fortunes,” Equity tors aggressively disposing of their Figures published by the exchange terbank market, foreign currency li- Axis said. equities. recently show that total foreign pur- quidity has improved, giving way for Experts have also warned that the He said the exodus could pile pres- chases during the year were $1,23 foreigners to exit the market,” Equity central bank’s recently introduced sure on the Reserve Bank of Zimba- billion, while sales were $6,66 billion. Axis, a local research firm, said in a foreign currency auction system will bwe to allocate the scarce foreign Significant net sales were recorded note recently. be overstretched by foreign investors currency to the divesting foreigners, in Bindura Nickel Corporation (BNC), Foreigners had for years encoun- stampeding to exit the ZSE in the af- thereby cutting injections to other sec- Delta and Innscor — $3,43 billion, tered difficulties moving their funds termath of its five-week-long closure, tors that would benefit had the govern- $708,56 million and $378,18 million out of the country due to foreign cur- which ended on August 03. ment not rushed to close the ZSE. respectively. rency liquidity challenges. Government closed the market on “The effect of that closure was that Foreign trades accounted for 22,77 “Sell-offs have also been stimu- the pretext that speculative activity we now had some form of dampened percent of total turnover on the ZSE lated by heightened uncertainty in the involving fungible stocks was driv- appetite for investment on the market for the year. economy. An unstable environment ing inflation, which at the time had particularly by foreign investors,” Due to Harare’s policy inconsis- poses escalated risks to foreign inves- Itai Chirume reached 700 percent. Chirume said during a recent Fingaz tencies, investor flight has plagued the tors, who have other alternatives with “It is likely that foreigners will re- Itai Chirume, the executive director Executive Dialogue. — Staff Writer ZSE for almost half a decade now, but positive risk adjusted returns. main net sellers as long as the econ- of MMC Capital, recently told The Fi- [email protected]

Sasol wraps up US$404m Gemini sale

OUTH African fuel and chemicals giant, Sasol’s sale of assets to rein in debt has progressed with Sthe finalisation of its US$404 million (R5,9 billion) disposal of its stake in the US-based Gemini polythene business. Sasol, which recently said it had raised US$3 billion, or nearly R44 billion, from asset sales — the biggest being the $2 billion divestment from its Lake Charles chemical project in the US — has flagged the possibility of a rights issue to reduce debt. The Lake Charles transaction alone cut Sasol’s debt to US$8 billion, while the success in making other di- vestments was lowering expectations that the company would have to raise US$2 billion by issuing shares. At the end of November, Sasol said it was selling its 50 percent stake in Gemini to its partner in the business, Ineos Olefins and Polymers, which operates the toll manufacturing facility in La Porte, Texas. The facility produces bimodal high-density polythene (HDPE) products, which are used in pipelines and film. Analysts said at the time that while the price might look cheap in the future if HDPE prices improved, this was a distress sale by Sasol, which ran up debt when its Lake Charles project in Louisiana ran US$4 billion over budget and was delayed. The Gemini transaction closed on December 31. “The consideration of US$404 million was satisfied through a combination of cash and release from debt obligations,” Sasol said on Monday. “The relevant debt facilities and security package have now been successfully restructured, releasing Sasol and its subsidiaries from any obligation to provide further security. The cash proceeds from the transaction were received on December 31, 2020 and will be used by Sasol to repay near-term debt obligations.” In the past year, Sasol shares have fallen by about 57 percent on the JSE. The company has a market capitalisation of R83,44 billion. — businesslive.co.za The Financial Gazette January 07-13 2021 | Page 15 Column Banking and insurance: Challenges, opportunities

Andrew Chirewo per middle-income countries. For example, the 2019 and 2020, inhibit the sector’s ability to meet follows: average insurance per person in Botswana is the demands of the National Financial Inclusion Digital transformation HE year 2020 marked the start of the fourth decade US$201,12, against Zimbabwe’s insurance cov- Strategy, particularly the need to be responsive The most cited opportunity was the need for since the first automated teller machine (ATM) — er of US$9,42. to stakeholder needs and facilitate access to us- players to move towards offering digital prod- Tthen a moneylink — was installed in Harare in 1990. These ratios, together with the relatively low age of quality and affordable financial services. ucts and services in line with the prevailing 4th Back then, this was such a wonder to the extent that folks pension coverage and penetration rate generally Respondents, thus, expressed hope that the au- Industrial Revolution “IR”. Moreover, present- would sacrifice their lunch hour to go and have a look at show the level of product and policy interven- thorities will address these challenges through ing at the 2020 Institute of Bankers of Zimbabwe the innovation. tions that is needed to catchup with other upper (IOBZ) summer school, P. Osero, group head of A look back also shows how the banking and insurance middle-income countries. sales and marketing at Fintech, further noted that sector has transitioned over the years. It is, therefore, hoped that the deepening of players needed to transition from conventional From the days we would log into the core banking sys- financial markets, e.g. through the recent launch banking of developing products to disruptive tem — then Equation 3, and continuously press the F5 (Re- of the Victoria Falls Exchange and the planned banking by developing solutions. fresh) button on the computer keyboard to check for new commodities exchange, among others, will un- Given that digital transformation is a broad deposits — to the modern day of SMS and email alerts. lock more opportunities for insurance companies field, which can be easily misunderstood, and From the days we would dash from the Midlands Hotel and pension funds to create more sustainable that about 80 percent of digital transformation to get across Main Street to withdraw some more cash at wealth for their members. initiatives are known to have failed, it is also the corner ATM — to the modern day of Near Field Com- Meanwhile, based on the survey of sector the forthcoming National Development Strategy important for players to develop clear and exe- munication “NFC”. expects, among them executives, senior manag- 1 (2020-25) and attendant annual fiscal policies, cutable digital transformation strategies. Stake- From the days my brothers at Coleen Bawn in Gwanda ers and clients, the banking and insurance sector the National Financial Inclusion Strategy (2021- holder buy-in, goal clarity, resource allocation would queue at the enquiries desk in the onsite Bank’s sub- currently faces several intertwined challenges. 25) as well as other policy interventions. and ecosystem development are some of the in- branch, during lunch hour on a Wednesday, just to check These challenges, most of which were com- Most importantly, survey respondents also gredients for a successful digital transformation their account balances — to the modern day of mobile pounded by the Covid-19 pandemic and the re- observed that these challenges could also be initiative. banking. forms induced double deep recession between solved by converting them into opportunities, as See full article on www.fingaz.co.zw From the days we would move around town with our local Church’s asset register looking for the best insurance quote — to the modern day of cell insurance. From the incorporation of Zimswitch with a partnership of just six banks in 1994 and the processing of its first ATM and point of sale transactions in 1995 and 1996, respectively, to its designation as the national switch in 2020. And of cause, from a handful of banks and insurance companies in the 1980s, to the liberalisation induced ex- pansion in the 1990s — which saw the birth of discount houses, finance houses, merchant banks, etc — and then to the modern day banking and insurance sector comprising 13 commercial banks, five building societies, 8 deposit taking microfinance banks, two development finance institutions, more than 200 microfinance entities, 12 direct life assurance companies, 18 short term insurance companies, one microinsurance company and eight funeral assurers. These institutions are well supported by a broader financial services sector comprising regulatory authorities, com- missions, agency networks, reinsurers, insurance brokers, two stock markets, pension funds and asset management companies, among other stakeholders. Indeed, global rat- ings company, Fitch, considers Zimbabwe’s banking and insurance sector to be more established than those in most of the country’s regional counterparts. Thus, as the government pursues Vision 2030, which, among other things, targets to attain an upper middle-income status for the economy by 2030, it is important to as- sess the preparedness of the banking and insurance sector to support this drive. This article utilises FinScope surveys, central bank bulletins, and insurance journals, among other publications, to benchmark Zimbabwe’s banking and insurance sector, particularly against other upper middle-income countries such as Botswana and South Africa. This helps in identifying gaps and proffering suitable solutions and policy interventions to close the same. A survey of banking and insurance executives, senior managers, key clients, and stakeholders was also undertak- en to establish the practical, day to day challenges as well as emerging opportunities that are attendant in the banking and insurance sector. This will also go a long way in in- forming policy direction, as well as solution development for players in the banking and insurance sector. Thus, in terms of findings from industry publications, the country’s banked population stood at 30 percent in 2014, up from 23 percent in 2012. This compared favourably to fellow lower middle-income country — Mozambique. However, it ranked below another lower middle-income country — Kenya (43,9 percent) and upper middle-income countries — Botswana (50 percent) and South Africa (92 percent). This indicates the additional effort that is still needed to attain the levels of other upper middle income countries. Additionally, the banking sector’s investment in man- ufactured capital yielded estimated ATM and branch den- sities of 6,4 and 3,8, respectively, as at the end of 2019 — according to the World Bank. FinMark Trust noted that the country’s bank branches and ATMs declined notably between 2014 and 2018 — and may decline further in 2020. The decline in ATMs reflected reduced relevance due to shortages of cash as well as the move towards digital platforms, whilst the decline in bank branches signified both the move towards a digital first economy as well as reduced economic activity and business viability in some of the country’s cities and towns. ATMs and branches are expected to continue losing relevance, as mobility takes centre stage. In the insurance and pensions industry the FinScope Survey (2014) noted that about 30 percent of the adult population used insurance products. Back then, the insurance penetration ratio averaged 3,4 percent. At the end of 2019, however, the country’s insurance penetration ratio fell considerably to just 0,8 percent, reflecting the adverse impact of currency weakness/depreciation and rising inflation on premiums growth and insurance uptake. Both the insurance penetration ratio and density generally show the low levels of money spend on insurance, compared to up- Page 16 | January 07-13 2021 The Financial Gazette Column When is income tax payable on HSP claims? HE settlement of medical claims al- rounding the performance of services or de- the income. The condition of payment cannot post- ways present a challenge for Health livery of goods which needs to be fulfilled pone the point of accrual. T Services Providers (HSP) with re- by either party to complete the transaction. Watermeyer J in the case of Lategan v CIR 1926 gard to cashflow and more so, the uncer- The commissioner-general does not CPD 202, while stressing this point had this to say tainty around the same regarding the tim- have to wait for the receipt which could “… He has not become entitled to a right to claim ing of taxation of income arising from such happen in future in order to tax income. payment in the year of assessment, but he has ac- claims. The time for taxing claims just like any quired a right to claim payment of the debt in future. Medical aid societies often take a long other income is embedded in the definition "This right has vested in him, has accrued to him time to settle the claims of HSPs, spanning of gross income which is defined in sec- in the year of assessment, and it is a valuable right in some cases into several months or years. tion 8 (1) of the Income Tax Act (Chapter which he could turn into money if he wishes to do The question then is whether the taxman 23:06). so”. must wait that long as well in order to be The point of accrual of income for HSPs It is therefore, important to note that even though settled his dues. can therefore, be a tricky concept and this a taxpayer has waived the right to receive the pay- Generally, income is brought to tax Tax Matters may affect their tax liability. ment or will receive the amount in installments, it when it is received or accrued, whichever Medical aid service providers usually does not defer the tax point. with occurs first. An accrual is distinguished have payment terms whereby the medical The courts have also emphasised that an accrual Marvellous Tapera from a receipt because it is based on a tax- aid service providers make payments to should be one that is unconditional. Another point of payer becoming entitled to an amount. HSPs over a period of time regardless of call for HSPs is therefore, to determine whether all It is largely determined by invoicing for amount contained in that invoice becomes the invoice being issued. The issue that may conditions precedent are satisfied before they can be the services provided or goods sold. an accrual i.e. becomes due and payable, come to the fore is whether these payment entitled to an amount. The moment an invoice is issued, the unless there are conditions precedent sur- arrangements affect the point of accrual of The key determinants of a liability are the price and quantity. The two enable the liability to be determined with reasonable accuracy. When any one of them cannot be ascertained with reasonable accura- The Financial Gazette @FingazLive cy, there is no accrual, hence no tax liability. In the South African case of ABC (Proprietary) Limited vs CSARS (case No: 12262), it was stated that the price and quantity are conditions precedent that should be fulfilled first before an accrual (invoice can be made) can take place. Applying this principle to medical claims, the “price” is the tariff and “quantity” the procedure/operation to be performed or drug to be supplied. These two are known in advance of the claim by the HSP. The tariffs are predetermined by the Health As- Develop financially sociation. This means the conditions precedents are satisfied at the point of completing the claim. Hence the moment a claim is completed by the patient, the literate business leaders HSP becomes liable to pay tax on income accruing under the claim notwithstanding the money will be recovered from a medical aid society at a later date. Subsequent rejection of the claim form by the medical aid society triggers a reversal of an accrual and this should be corrected through a credit note. HSPs are found in a position where they have to declare income for tax purposes, and pay taxes on amounts not yet received. This may give rise to cash flow problems as they are expected to settle their tax liabilities while no ac- tual cash has been received. It is expected that HSPs may want to seek recourse from the law so that such a problem be eliminated. The law is, however, clear on this matter and the amounts accrued by HSPs should be brought into their income. In the event that the HSP omits the income, the HSPs may face stiff penalties. The revenue authority may raise an assessment in terms of section 46 of the Income Tax Act for the understated income and request the HSP to settle the understated tax, this may also lead to a rise in interest and penalties. In conclusion, the HSP should take into account outstanding claims in their returns to avoid the penalties and interest. The law is continually changing to take into account the unusual economic environment that businesses are operating in. HSPs, may collectively approach the ministry of Finance so that the problems faced by the industry are taken into account at law. Meanwhile, the proposed law for 2021 will see self-employed health practitioners whose tax affairs Subscribe for your former are not in order, and not in possession of a tax clear- ance being required to pay presumptive tax which is as high as US$5 000 per month. & your child’s school Those wishing to trade legally and pay less taxes, should opt to register for income tax and pay income tax which is lesser punitive compared to presumptive tax. Contact our subscriptions team on: Income tax is payable only when one has made a [email protected] profit and is levied at an effective tax of 24,72 percent of self-employment income (net profit) earned during the relevant tax year of assessment. You will need to speak to a tax expert or chartered Subscribe Now accountant immediately to know more about the proposed presumptive tax and how to structure your affairs in order to minimise tax liability and optimise the value of your business. Meanwhile, Matrix Tax School (Pvt) Limited will be hosting a webinar seminar on “2021 Tax Develop- ments and December MTU” on January 20, 2021. Do not miss out on this very important event!!! ● Tapera is the Founder of Tax Matrix (Pvt) Ltd and the chief executive of Matrix Tax School. He writes in his personal capacity. The Financial Gazette January 07-13 2021 | Page 17 Column Big Brother and the year 2021

n his novel, Nineteen Eighty-Four (1984), English nov- Therefore, we see strong headroom for paral- to be risks related to excessive rainfalls and and this could lead to budget overruns that also elist George Orwell focuses on some of the extreme lel market rates to move northwards this year. floods. Like the impact of Cyclone Idai, the oc- exert pressure on the exchange rate; and Iconsequences of government overreach and repressive Morgan & Co Research contends that it currence of natural disasters may put pressure 5.Gold prices. Last year, Zimbabwe benefited control of all persons and behaviours within society. would make sense for businesses to move away on government coffers and the economy can slip from firm gold prices on the international mar- The story takes place in an imagined future, the year from using blended rates as this presents serious into another recession. The need to rehabilitate kets and this translated into improved foreign 1984, when much of the world has fallen victim to perpetual planning and forecasting risks. infrastructure and provide food security will also currency receipts. war and propaganda. Big Brother, the leader of the Party, Parallel market rates are more reflective of the put pressure on the exchange rate; Any downward movement in gold prices in exhibits omnipresent surveillance. In the setting, television true value of US$ balances. 3.Industrial actions. The deteriorating dispos- 2021 will have a negative impact on foreign cur- screens watch you and everyone spies on everyone else. Below are some of the key triggers or factors able incomes in the broader economy are set to rency flows in Zimbabwe thereby affecting the The government exercises an extremely high degree of to look out for as these impact the foreign ex- spark another round of strikes within the public foreign exchange market. control over the public while having absolute control over change market in Zimbabwe; service. In conclusion, the uncertainties in 2021 call the economy. While the novel was published in 1949, it has 1.Covid-19 related risks around the globe and We opine that such actions will force the gov- for investors on our markets to hedge against for- become very relevant in understanding modern-day klepto- in southern Africa. South Africa, Zimbabwe’s ernment to “print money’ thereby injecting more eign exchange risks. cratic political systems. largest trading partner has reverted to stringent Zim dollar liquidity in the economy. This will Parking Zim dollar balances in export-ori- Looking at the Zimbabwean context, Morgan & Co Re- lockdown measures. This could negatively im- then result in deteriorating exchange rates; ented firms and regional plays would provide search has observed “Big Brother” tendencies in as far as pact Zimbabwe through (i) reduced export re- 4.Unplanned government expenditures. investors with a cushion against the deteriorating monetary policy is concerned. ceipts and (ii) a slowdown in remittances out of While the 2021 National Budget indicates a shift exchange rate and inflation in Zimbabwe. Monetary authorities in Zimbabwe have always been South Africa. All in all, reduced foreign currency from Command to Smart agriculture, we cite ● Matsika is head of research at Morgan looking to “kill” the parallel grey market for foreign ex- into Zimbabwe will mount pressure on the paral- that there is scope for unplanned government & Co, and founder of piggybankadvisor.com. change trading. lel market exchange rates as the supply of US$ in expenditures this year, particularly as we move He can be reached on +263 78 358 4745 or The Reserve Bank of Zimbabwe (RBZ) has been put- the economy declines; towards the 2023 elections. [email protected] / batanai@piggy- ting in place a raft of measures, controls and directives 2.Risk of devasting cyclones. There appears Political interests will always take centre stage bankadvisor.com earmarked at having a full grip of the monetary system. An auction system is now in place, which is the official market to trade foreign currency in Zimbabwe. A major concern has been the growing spread between the parallel market rate (USD1:cZWL120) and the auction rate. Meanwhile, the RBZ has been publishing official exchange rates every Tuesday, but the rate has been static around the 80s against the greenback for some months now. Transparent in theory but “useless” in practice. Useless because no ordinary person ever gets to buy some greens at that level for day-to-day transactions.

Economics & Market Intelligence with BATANAI MATSIKA

Given the significant shortages of foreign currency (bearing in mind a highly import-dependent economy), the parallel market remains the main source for foreign currency for the ordinary citizen as well as some formal enterprises. It should also be highlighted that fears of value destruction of Zimbabwean dollar (ZWL) balances have re- emerged in 2021. This has been driven by a plethora of factors such as weak local economics and the re-emergence of Covid-19 related lockdown measures. As a result, economic agents are willing to pay huge premiums to convert ZWL bank balances to US dollars. This has an effect of putting pressure on parallel market rates that are currently at cZWL120. We have observed that most companies and economic agents in Zimbabwe make use of blended rates (average of the official and parallel rate) for planning and forecasting purposes. To evaluate the impact of the different exchange rate movements on blended rates, we have carried out a scenario analysis. Under Scenario A, the official exchange rate will hold at ZWL82 in Q1 2021 and move to ZWL90 in H2 2021. Under Scenario B, the official exchange rate will move to ZWL100 in Q1 2021 and ZWL120 in H2 2021. Our an- chor assumption is that the parallel market exchange rate will move to ZWL150 in Q1 2021 and then ZWL 200 in H2 2021. Based on our analysis, the gap between parallel market rates and the blended rate is expected to widen under both Scenario A and B on the back of the stickiness on the official auction rate. The RBZ has not hidden its desire to see the country utilising a crawling peg that will continue to lag parallel market rates. Generally, a crawling peg enables a central Bank to manage currency fluctuations and curb the probable devaluation of the local currency. Consequently, we have assigned a 75 percent probability that Scenario A will play out given the need to tame inflation to single digits and the heightened socio-economic risks. It is unlikely that Scenario B will play out (probability of 25 percent) since it moves away from the idea of a soft peg being implemented by the RBZ. All in all, the concern is that stringent lockdown measures are back and the economy remains fragile. There is also a heavy reliance on imports (crit- ical raw materials, spare parts and electronic consumables). Page 18 | January 07-13 2021 The Financial Gazette Companies Organisational culture a top priority for CEs

EFORE we go into how we can are at the heart of any culture change It is however, important to periodically gauge change organisational culture, programme. Organisational culture is your employee engagement. B it’s important to understand what poorly understood leading to culture If you discover persistent areas that are negative culture is and its key facets. Organisational initiatives that fail and waste money. you may want to dig deeper into the organisation’s culture according to Edgar Schein (2004) Others have mixed employee culture. is “the pattern of shared basic assumptions engagement with culture again creating As part of the change programme, you need to — invented, discovered, or developed by unnecessary wasteful confusion. understand what type of culture you have. The best a given group as it learns to cope with Organisational culture and employee approach to understanding culture incorporates both its problems of external adaptation and engagement are what environmental quantitative methods and qualitative methods. internal integration — that has worked climate is to weather. A word of caution though is that when using the well enough to be considered valid and, Like climate, organisational culture is quantitative approach use validated instruments, not therefore, to be taught to new members as more stable and very difficult to change. a questionnaire designed over a cup of coffee. the correct way to perceive, think, and feel Employee engagement is like weather Using instruments that are not validated is waste in relation to those problems.” HR Perspective which can change from minute to minute, your money and time and it leads to nothing tangible. According to Hofstede (1991), “culture with hour to hour. In the qualitative approach also use tried and tested is the collective programming of the human Memory Nguwi It is important to note that employee methodologies that have been validated. In both mind which distinguishes the members of engagement is heavily influenced by the approaches always measure the current culture and one organisation from another” (p180). organisational culture. If you want desired desired culture. It is evident from these definitions that mutual experience. lasting change, focus on organisational Before you start the culture is built through shared learning and This shared learning and experience culture instead of employee engagement. culture change you must be absolutely clear on Piecemeal what business problem changes to is being negatively the system impacted by the culture. without a The Financial Gazette @FingazLive There is no point in going through a culture shared learning change programme experience will designed as a “joy ride” without targeting a not work. business problem. Once the business problem is identified and commonly understood by the leadership, the whole How to receive process assessing your current and desired culture can start. This should enable you to establish the gap between the Financial Gazette current and desired culture. In your assessment, you may discover that in the same organisation there are various subcultures supporting different business and personal agendas. The level of change planning and initiatives will e-NEWSPAPER via email depend on the size of the gap between the current and desired culture, and the number of subcultures operating within the organisation. When starting the culture change programme, remember no change will happen as long as it does Dial not have a shared learning and mutual experience component. Any culture change programme that does not incorporate this important element is 185# unlikely to succeed. * The biggest hurdle to changing culture lies in first having a clear understanding of your current culture to enable you initiate changes that will take you to your desired culture. to register & After understanding your current culture and where you want to go the next step is to come up with a solid change programme that takes into consideration the shared learning and mutual Subscribe Now experience. Piecemeal changes to the system without a shared learning experience will not work. Team building & get FULL access! and other peripheral activities such as training based on lecturing people on culture lead to failures in culture change programmes. (Available to Econet Subscribers only). The culture change process should be largely be made up of a programme that incorporates experiential learning led by the executive team. Do not stick religiously to a culture change programme when new dynamics emerge. For any enquiries, contact our Remember culture change involves very fluid subscriptions team: dynamics in human interactions. New relationships and partnerships are forged as you are going through the change programme. Taka: +263 773 327 978 Redirect these to support your bigger business agenda as per your change plan. Elizabeth: +263 784 038 392 You must also remember that every business system or policy must be reviewed and checked for alignment to the desired culture. Ronald: +263 784 929 187 This includes basically everything; how things are done, how people are managed, how financial Email: [email protected] resources are managed and accounted for. Realign your leadership team and check if their management styles are in line with the desired culture. Once you have implemented this initiative, do your review after 12 months. However, remember culture change can be very painful and it takes time. Do not expect immediate change but if you are doing it well the positive signs show early.  Nguwi is the managing consultant of Industrial Psychology Consultants (Pvt) Ltd. He writes in his personal capacity. The Financial Gazette January 07-13 2021 | Page 19 Column Guerilla marketing: How Coca-Cola has stayed well ahead hen one hears the term "guerrilla mar- and one a kind. remains top of mind during and after the Delta has managed to build a reputation keting", immediately the mind assumes A brand that evokes emotions that make events have taken place. for hosting successful events, and through W the concept is related to a combative form people feel good, unique, special and val- As a brand, Coca-Cola has offered effective marketing, the masses look for- of marketing, one which is disruptive, unrelenting ued is a brand that is able to stand the test something more than its competitors ward to the next installment of these an- and endeavours for success or market share by any of time as Coca-Cola has managed to real- through selling “happiness” in a bottle. nual events. means necessary. ise for over 128 years. When a brand sponsors events of such To succeed in guerrilla marketing The term guerrilla marketing may be considered Delta offered the exact same facility to magnitude, the benefits are plenty and one should endeavour to: ugly, however this is not the case. In an environ- Zimbabwean consumers, and it was an ex- competitors have very little room to be vis- 1. Not overthink the idea or strategy. ment where marketing budgets are being trimmed, citing time when names ible making the sponsor’s mar- The silliest ideas are usually the most im- and skimmed, guerrilla marketing is a strategy more of local origin were visi- ket share, advertising coverage pactful. companies, especially in Zimbabwe, need to em- ble in all major retail, fast and visibility unparalleled. 2. Remember that the tactics can be ap- ploy. food, and supermarket Locally, Delta has hosted plied to for and not for profit campaigns. It requires creativity, but to implement such cre- fridges. excited musical shows under 3. Being sensitive or sentimental in a ativity does not warrant a large expense. Event guerrilla mar- Varayidzo Michelle Dube the Castle Lager brand. campaign is not a bad thing. Guerrilla marketing is a concept which can be keting The shows which are held in 4. Remember successful campaigns applied to a large number of brands across product The Coca-Cola strat- open stadiums and sports clubs need not be expensive, mostly creative. lines, and is most effective for consumer goods. egy continues to be one targeting events are well-organised and those who drink 5. Ensure the campaign encompasses as When employing guerrilla marketing techniques, which are for the mass market, and evoke beer buy it at a heavily discounted draft many aspects of the marketing mix, ideally organisations need to ensure that the approach is a various emotions when the events are tak- price. all of them. 360 degree one, as will be highlighted in the Co- ing place. With ample catering, clean ablution fa- n Dube is the marketing, public re- ca-Cola Company examples to follow. Coca-Cola has sponsored the Olympic cilities, and secure parking, these are open lations and tenant coordinator for Joi- Delta Beverages (Delta), the local brand custo- Games, Nascar and American Idols for to families and groups across age and so- na City since 2013. She is a member of dian of Coca-Cola, has been successful in ensuring years and this has built the brand in that cial status. the Marketers Association of Zimbabwe that the product, price, place, promotion, people, such sponsorships ensure that Coca-Cola Through event guerrilla marketing, and writes in her personal capacity. and physical evidence are all taken into consideration when applying guerrilla marketing tactics to their brands. Guerrilla marketing encompasses outdoor, indoor, event and experiential marketing tactics. Coca-Cola has successfully remained innovative while maintaining simple principles, both key aspects of guerrilla marketing initiatives. Outdoor guerrilla marketing Outdoor campaigns have been used by Coca-Co- la internationally in train stations, airports, park benches, bus shelters, buses, trains, bus stops, and other outdoor “public spaces”. Outdoor guerrilla marketing is effective in that consumers get to interact with the brand as they go about their day to day activities. Outdoor guerrilla marketing tactics need to remain fresh, fun, impact- ful yet simple. In Zimbabwe, Delta has done well to brand local public spaces and sponsor signage and branding for bars, bottle stores, and entertainment areas which carry their products. When one is driving along Zimbabwe’s high- ways, oftentimes stop overs, and growth point general dealers, bars and restaurants will carry the Coca-Cola, Castle Lager, Zambezi Beer, Golden Pil- sner and the Chibuku opaque beer signage branding. Indoor guerrilla marketing Coca-Cola has contracts for mall advertising in over 25 countries around the world. Through indoor guerrilla marketing, the Coca-Cola brand is visible on public surfaces such as indoor wall murals, floor murals, escalator wraps, movie screens, elevator doors, escalator stairs and rails, in mall food court tables, and vending machines to mention a few. By doing this, Coca-Cola ensure that the majority of the mall advertising sites carry their brand and this ensures that competitor brands are “drowned in a sea of Coke”. This is an effective strategy as competitor brands are no longer a part of the mall visitors’ experience. By being visually everywhere in the building, Co- ca-Cola encourages purchase of their products at various touch points including combo deals with fast food and entertainment retailers. The likelihood of a consumer buckling under the “pressure” of seeing the brand is much higher when it is visible throughout the mall and entertainment facilities. When one is at the Robert Mugabe International Airport, the brand they will see is the Econet brand, from the billboards in the jet bridge as one disem- barks the plane, to branding around the carousels while waiting for luggage, and Econet branded luggage trolleys. What this does is encourage purchase of Econet sim cards for visitors and returning residents to Zimbabwe. Through effective guerrilla marketing, Econet has realised the highest subscriber base in the country, increased revenue generation, unmatched product uptake, and top of mind positioning in the mobile network markets. Experiential guerrilla marketing An example of experiential guerrilla marketing employed by Coca-Cola was its “Share a Coke campaign” launched in 2016 where consumers could have their names printed onto their Coca-Cola cans while they waited, and they could also pick out a can with their names in retail outlets. This campaign created a global phenomenon where adults and children alike connected with the brand and felt special because they could consume a drink which carried their very own name, something no other brand had done, or has done since. In 2014, Coca-Cola personalised over two million diet coke bottle designs in an effort to highlight to their consumers that each consumer was unique Page 20 | January 07-13 2021 The Financial Gazette Motoring The ups and downs of car sales How brands are faring in the UK

TOP GEAR with Richard Wiley EW will mourn the passing of the year 2020 no thanks to that Fwretched virus that halted travel, mangled businesses and claimed lives the world over. Hopefully, the pattern won’t be repeated in 2021, but the early signs are not good as additional restrictions are being introduced across much of Europe and all of Mzansi where an er- rant population has foolishly ignored basic preventative measures to ensure that even buying a beer is no longer possible in the early days of 2021. Closer to the subject matter of this column, viewing a new car on a show- room fl oor in my vicinity is no walk in the park either. Access to those fl oors is restricted, temperatures have to be taken, personal details recorded and then staff have to be called to open each car on dis- Taycan Turbo: The Porsche Taycan is the UK’s best-selling luxury car play. And before the locks are re-activat- ed, some poor soul has to re-sanitise the interior and the door handles too. No wonder car sales are down in RSA by around 30 percent. The much-bigger UK market mirrors this stat with uncan- ny precision as predictions suggest total sales of 1,56 million units which represents a drop of 32,5 percent on 2019. More alarmingly, that total will be the worst since 1982 and is over one million short of the 2016 record of 2,69 million units. I’ve always expressed the view that the UK market is unusually sophisti- cated and is an accurate barometer of what’s good and not so good as far as new cars are concerned. Brand loyalty is not nearly as entrenched as it is in RSA where, to be a tad unkind, I feel a herd instinct plays a part. So, when the chips are down, the UK market tends to exercise more discretion when it comes to unloading Shekels, and for me, that makes the UK’s latest sales fi gures all the more interesting. I’ve Tesla: The Tesla Model 3 is responsible for the brand’s sales upturn in the UK avoided mention of peripheral brands as they simply are not relevant in our part Martin, Ferrari, Lotus and Maserati se- Unsurprisingly, Fiat continues to while Renault is also on a positive tra- 2,95 percent. I could not establish a de- of the world, but having said that, some cured just 0,19 percent between them. struggle at a mere 1,37 percent even if jectory at 2,73 percent thanks in part to fi nitive reason for this negative trend, but brands that were once mainstream are Talking of Audi, the brand with the the latest 500 versions hold out much a positive reaction to the new Zoe. Re- I’ve stated in other articles that Hyundai rapidly becoming peripheral. four rings is on the ascent following sup- promise. What has raised eyebrows, nault’s early move into EVs is also antic- no longer enjoys a cost advantage which In the dim and distant past when car ply problems occasioned by diffi culties well mine at least, is that Mazda has de- ipated to add momentum. it was once able to exploit. Most alarm- assembly was once a common practice in homologating models in accordance clined to a disappointing 1,43 percent, Vauxhall, under PSA ownership, has ingly, word on the high street is that UK’s in Zimbabwe, brands such as Alfa-Ro- with new emissions regulations, record- reportedly as a result of its tardiness in lost 15 percent market share in 2020 to Hyundai dealers are among the country’s meo, Peugeot and Citroen were seen in ing a fi gure of 6,7 percent. Arch-rival introducing EVs, but I also suspect that record 5,89 percent. Pundits suspect that unhappiest which suggests their margins signifi cant numbers, so I’ve included BMW fell away slightly to 7,02 percent the company’s rather lacklustre naturally the axing of former GM platforms has are being pulled in. Close relation Kia, them in the latest UK market share stats. with 2, 4 and 5-Series dropping behind aspirated petrol engines haven’t helped. caused the hiccup but the new Corsa and by contrast, has breached a 4,47 percent Alfa Romeo, sadly, found the fewest overall market trends while the 3-Series Ironically, their best engine in my book Mokka models provide hope for a resur- market share and is now the UK’s eighth number of buyers since the 1960s with a continued its dominance as the top-sell- is the 2.2 turbo D but the Brits are shell- gence. My personal, unscientifi c obser- biggest brand. market share of just 0,12 percent. Incred- ing compact executive. ing diesels like peas as the mass media vations suggest that corporate sales were Sadly, Mitsubishi is throwing in the ibly, the journalists’ favourite, the Stelvio Mercedes also failed to arrest a 2-year continues to espouse politically driven crucial to Vauxhall’s well-being and that towel with a market share of just 0,57 SUV, was rooted fi rmly at the bottom of decline at 6,9 percent, albeit that the lat- drivel about the ill-effects of diesel com- Covid-19 has had an unduly negative percent to look back on, but Volvo is its class which tells you quite clearly that est A-Class remains fi rmly entrenched bustion. effect. gaining ground with a 2,79 percent mar- dynamic ability is not the only factor in as a top-5 overall best seller. Reduced Suzuki sales in the UK have been Volkswagen is hot on the heels of ket share driven largely by the XC40 sealing sales. C-Class sales probably refl ect the ex- most disappointing with a sharp drop-off Ford as the market leader at 8,86 percent, which sits atop the premium compact At 1,76 percent, Citroen is relatively pected arrival in 2021 of a new model. to just 1,24 percent “led by” the Vitara cutting the latter’s lead in half, and with SUV segment. Jeep meanwhile, is hold- better off but that fi gure hides the fact Over in the Midlands, Jaguar Land which declined by 57 percent in 2020. the Golf 8 in full supply in 2021 along ing station at a paltry 0,27 percent. that the brand has lost half its market Rover has endured mixed results with Diffi culty in meeting fl eet average CO2 with the well-received electric ID.3, the Tesla too is on a charge (excuse the share in the last ten years. Maybe the fact Jaguar declining to a disappointing 1,48 targets that killed off the Jimny, may be money is on the German brand to ascend deliberate pun) increasing its share from that Citroen has shed its eccentric side percent partly because the XE compact a factor. Toyota face no such issues and the sales throne this year. 0,57 percent to 1,26 percent with the has eroded brand loyalty? Blood-brother exec simply hasn’t set the cash tills after years of lacklustre sales in the UK, VW’s blood brother Skoda continues Model 3 sitting in second place in its Peugeot does much better at 3,46 percent alight, being outsold 12 to 1 by that seg- the brand now commands a healthy 5,74 to fi nd wide acceptance in the UK. Now class behind Beemer’s 3-Series. but this fi gure hides a continual decline ment stalwart, the BMW 3-Series. Land percent share which I’m sure refl ects the commanding a 3,6 percent share, models And fi nally, Ford remains top of the as well as the fact that its lauded 208 sits Rover, by contrast, showed an upward introduction of more interesting design such as the Superb, Octavia, Enyaq and pile but by a slender margin from VW, down in seventh place in the supermini trend to 3,6 % percent thanks to early interpretations led by the Corolla and Fabia are widely expected to maintain no thanks to a decline from 10,22 per- class. This drop is hard to explain, espe- market acceptance of the new Defender, RAV4. Sub-brand Subaru though, is all momentum. Cousin SEAT, by contrast, cent to 9,43 percent. Apparently, the cially as Peugeot currently crafts some a trend which could see the demise of the at sea and with a paltry 0,05 percent mar- declined marginally to 2,75 percent but long-time best seller, the Fiesta, is strug- of the best-wrought interiors in the busi- struggling Discovery. ket share, its future in UK is uncertain. this small drop is expected to be tempo- gling to shake off an increasingly hungry ness. A little surprisingly perhaps, BMW Nissan, which relies heavily on the rary as the revitalised model range which pack of superminis and a reduced range Elsewhere, Porsche continued its is battling to arrest a steady two-year Qashqai in the UK, is on a mild upward has lifted company fortunes across Eu- generally is giving Ford fewer tools with ascent as a UK star brand with a 0,81 decline at 7,02 percent market share but trajectory at 4,33 percent, but market ob- rope will provide positive movement. which to defend its crown. percent overall share, a fi gure that fails the evergreen 3-Series sustained its reign servers caution that the new Juke has not Lexus gained a little ground in 2020 So, while car manufacturers face the to reveal the extraordinary fact that the at the top of the compact exec segment been as well-received as anticipated. For to 0,87 percent, thanks apparently to the added burden of dealing with peripher- Taycan EV is the UK’s best-selling lux- and partly made up for declining sales in perspective, note that Nissan once com- new UX crossover but the brand remains al issues such as Covid-19, and on-line ury saloon, seeing off the Merc S-Class, the 2, 4 and 5-Series ranges. I’m also of fortably outsold Toyota in this market. rooted to the foot of the premium brand trading is becoming more common, Audi A8 and BMW 7-Series in the pro- the view that the latest 1-Series iterations Mini is holding station at a mean- sales charts. may I wish all readers of this column a cess. To put that overall Porsche fi gure will fi nd increased favour and most espe- ingful 2,8 percent with hopes raised by By contrast, Hyundai lost signifi cant much-improved 2021 marked by safe into perspective, consider that Aston cially, the upcoming 128ti. the introduction of a new electric model, ground, declining from 3,6 percent to motoring and good health. The Financial Gazette January 07-13 2021 | Page 21 Companies & Markets Econet 2020 top CSR company

Econet Wireless Social Mention Award situation in Zimbabwe was compounded by the victims who were either trapped or unreachable Over and above the group's concerted ef- Best exhibition of corporate social responsi- impact of Cyclone Idai in the eastern part of due to the destruction of infrastructure. The op- forts, Econet created a crowdfunding initiative bility a friend in need is a friend indeed. Zimbabwe. eration was facilitated by the provision of heli- which mobilised donations from its mobile sub- Many lives were lost and hundreds remain copters which airlifted victims to safety. scribers, hence facilitating country wide partic- his award is based on the judges' de- unaccounted for. Thousands of families re- Econet went on to set up camps which be- ipation. cision to recognise a category that may quired emergency shelter and the livelihoods came temporary holding shelters for evacuees. Overall, the company made sure their efforts Tnot necessarily have been captured in the of at least 270 000 people were affected. Infra- The group also set up a medical evacuation were aligned with that of the government and framework of the main model. Usually the na- structure damage was very significant. centre for the injured and mobilised a team of worked hand in hand with the Civil Protection ture of this category is largely influenced by Cyclone Idai hit the highly impoverished doctors to treat the same. Mutare Bottling Com- Unit as well as several government ministries in topical issues in the operating environment. For part of the country on March 15 and 16, 2019, pany opened up its warehouses to allow logis- rescue missions. example, in a year where most companies are with Chimanimani and Chipinge districts in tics support for humanitarian aid coming from The ministry of Energy confirmed that in- recapitalising through either debt or equity we Manicaland Province the hardest-hit. The cy- Econet subscribers. deed Econet was part of the first responders and may choose to reward the best recapitalisation clone came during a particularly challenging Econet mobilised earthmoving equipment to the government appreciated the example which turnaround. time for the country, which was emerging from clear destroyed roads. Approximately 55 kilo- the group set for corporates in being part of the This award rewards exceptional perfor- a drought and metres of road solution to such disasters. mance in other softer issues which do not nor- grappling were cleared Many other Zimbabwean corporates came mally form part of our model for performance with econom- along the together for a cause to reduce the impact of the review. ic challenges Hwengezi-Sky- disaster, but what stood out for Econet was the Last year, Econet Wireless (Econet) was in- that exacer- line route and ability to mobilise all its group companies and strumental in assuming the corporate social re- bated human- another 65 ki- respond timeously and aggressively to a nation- sponsibility role in a crisis. itarian condi- lometres along al disaster. Corporate social responsibility (CSR) is a tions across the Chikuk- Econet displayed the true meaning of the self-enforced workplace initiative that ensures the country. wa-Chimani- saying "a friend in need is a friend indeed". businesses utilise their resources for positive Econet was mani route. Generally, Zimbabwean corporates treat change in their communities and around the very agile in Some areas CSR as an afterthought or something which is world. CSR means that a company takes steps responding were not badly generally a function of excess funds. to ensure there are positive social and environ- to the national disaster by mobilising all of its destroyed but road infrastructure was destroyed Econet challenged other corporates in the mental effects associated with the way the busi- business units to contribute accordingly to the thereby inhibiting accessibility to food and way they do business, to become more transpar- ness operates. cause. Each company in the group was pursuing healthcare, leaving many stranded. The clearing ent, and take an active role in addressing social, Businesses that engage in active CSR efforts coordinated initiatives based on its capabilities. of roads went a long way in increasing acces- cultural, and environmental issues. take stock of the way they operate in the world The disaster was dubbed the worst national sibility to essential services for many victims. With 2020 being highly-characterised by to incorporate cultural and social issues, with disaster in the southern part of Africa in two Helicopters were already delivering food the Covid-19 global pandemic, Econet has ef- the aim of benefiting both in the process. Not decades, with floods wiping out roads, bridges and clothing to the stranded victims. Econet's fortlessly gravitated towards its nature of be- only can CSR models increase business and and dams. security and controls portfolio did 55 trips ing a first responder and has been instrumental revenue, they promote change and progress The United Nations estimated that across the from Harare to the affected areas, delivering 68 in raising awareness as well as providing free throughout the world, which often involves affected countries about US$1billion worth of tonnes of food and clothing to the affected. testing facilities and personal protective equip- helping people with few or no resources. infrastructure was damaged together with crops The funeral portfolio of the group through ment. During the year 2019 Zimbabwe experi- worth US$1 million. Specifically to Zimbabwe, Ecolife was instrumental in providing free as- Corporate social investment can help com- enced significant misfortunes which largely the damage was estimated to be US$16 million. sistance with funeral services such as coffins, panies build a reputation as a responsible busi- required everyone and every entity to stretch a Nonetheless, Econet spearheaded the oper- transport and food to each bereaved family with ness, which can, in turn, lead to competitive helping hand. An already fragile humanitarian ation search, evacuate and recover for stranded no cover. advantage.

For the week ending 06 January 2020 Page 22 | January 07-13 2021 The Financial Gazette The Financial Gazette January 07-13 2021 | Page 23 SERENA Williams' husband Alexis Ohanian has accused Madrid Open owner Ion Tiriac of being 'racist News Worth Knowing and sexist' after telling the American legend to retire. Former Olympic tennis ace Tiriac recently urged Sport Serena, 39, to retire based on her 'age and weight'. Page 24 January 07-13 2021 SPORT SHORTS Who is the EPL’s F1 season-opener could be postponed THE season-opening Australian Grand Prix could be postponed because of Covid-19 restrictions in Australia. It is due to take place in Melbourne from 19-21 March. The Australian Grand Prix Corporation, the Australian gov- most valuable player? ernment and Formula 1 bosses are in talks over the Albert Park race. ew will be expecting there to "The government will continue to prioritise public health be many big money transfers considerations while protecting our major events calendar," a Fthis January. Victoria spokesman said. In the current climate, Premier "Discussions between the Australian Grand Prix Corpora- League clubs have seen their fi - tion, the government and F1 management about the F1 calendar nances decimated. for 2021 are ongoing." On top of that, the best deals The Australian Grand Prix Corporation said it would pro- rarely seem to happen midway vide "further detail upon fi nalisation of arrangements with all through the season - though Man- parties in the coming weeks". — supersport.com chester United and Bruno Fer- nandes might have something to say about that. EPL sees number of At any rate, with the calendar pages fi nally turning their backs on positive covid tests double 2020 (thank heavens) and ushering THE English Premier League says 40 players and club staff in a New Year, we've still got one have tested positive for coronavirus over the past week - eye on the summer. more than double the previous weekly high. After previously testing once a week, the Premier League conducted 2,295 tests across two rounds over the past week. 19. Richarlison Between December 28 and 31, there were 28 new posi- Harry Kane Kai Havertz Paul Pogba tive tests and 12 more found between January 1 and 3. (£54m) | Everton The previous high was 18 positive results from Decem- 19. Phil Foden ber 21 to 27. (£54m) | Manchester City "With low numbers of positive tests across the over- 18. Rodri whelming majority of clubs, the league continues to have (£57.6m) | Manchester City confi dence in its Covid-19 protocols, fully backed by the government, to enable fi xtures to be played as scheduled," 17. Paul Pogba said the Premier League. — bbc.com (£58.5m) | Manchester United 16. Timo Werner (£63m) | Chelsea SA beat Sri Lanka in three days 15. Bernardo Silva MARK Boucher won his fi rst Test series as South Africa coach as the Proteas thrashed England's next opponents Sri (£63m) | Manchester City Lanka within three days in the second Test. 14. Roberto Firmino Dimuth Karunaratne moved to his fi rst overseas century (£64.8m) | Liverpool since 2017, before Sri Lanka lost their fi nal six second-in- 13. Andy Robertson nings wickets for 35 runs, Lungi Ngidi taking 4-44. (£67.5m) | Liverpool That left South Africa needing just 67 to win and Dean Elgar and Aiden Markram wrapped up the 10-wicket win in 10. Alisson Becker just 13.2 overs. (£72m) | Liverpool Sri Lanka's two-Test series against England starts on 14 10. Virgil van Dijk Marcus Rashford Sadio Mane Kevin de Bruyne January. (£72m) | Liverpool Former wicketkeeper-batsman Boucher took over as 10. Marcus Rashford (£72m) South Africa head coach in December 2019 and lost his only previous Test series against England 3-1. | Manchester United Sri Lanka, who were ranked fi fth in the world - above 9. Kai Havertz South Africa - before the series, have suffered two heavy de- (£72.9m) | Chelsea feats on this tour after losing the fi rst Test by an innings and 7. Heung-min Son 45 runs in Centurion last week. — bbc.com (£81m) | Tottenham Hotspur 7. Bruno Fernandes Djokovic & Nadal lead field (£81m) | Manchester United TENNIS stars Novak Djokovic 5. Raheem Sterling and Rafael Nadal will head the (£99m) | Manchester City fi eld at next month's ATP Cup, 5. Trent Alexander-Arnold which has been reduced to 12 countries because of the corona- (£99m) | Liverpool virus pandemic. 1. Kevin de Bruyne World number one Djokovic (£108m) | Manchester City leads Serbia as they look to de- 1. Harry Kane fend the title between February 1-5 in Melbourne. (£108m) | Tottenham Hotspur Nadal, ranked second, represents a Spain side aiming to avenge their defeat by Serbia in last year's fi nal. 1. Mohamed Salah Mohamed Salah Raheem Sterling Heung-min Son US Open champion Dominic Thiem leads Austria, while (£108m) | Liverpool ATP Finals champion Daniil Medvedev plays for Russia. 1. Sadio Mane The rumour mill isn't quite in Transfermarkt have us covered. much fanfare but their price tags Great Britain, who agonisingly missed out on the semi-fi - (£108m) | Liverpool overdrive just yet, but we're starting There are only four players who could dwindle unless they improve nals last year, have not qualifi ed for the 2021 event. to hear reports of high-profi le play- trip into nine fi gure transfer fees - upon their fi rst halves of the season. Qualifi cation is based on the ATP ranking of each coun- ers on the move, whether that's Har- but luckily, none of them are likely Pogba's fee (£58.5m) is argu- try's top-ranked singles player, while hosts Australia have ry Kane being linked with Man- to be going anywhere soon. ably the most signifi cant. been given a wildcard. chester City or the eternal prospect In fact, Liverpool have no fewer While the French midfi elder Last year's tournament featured 24 nations and Britain of Paul Pogba leaving Manchester than seven players in the top 20. shone in the win over Aston Villa qualifi ed through Andy Murray's protected ranking. They United. Yet there's still plenty of time for on New Year's Day, Mino Raiola's miss out this year, though, because Dan Evans is their high- It certainly begs the question of the above values to change dramat- admission that his time at United is est-ranked player at world number 30. The draw will take the most valuable players in En- ically between now and the sum- "over" is still ringing fresh in every- place on January 20, when the 12 teams will be divided into gland's top fl ight ahead of any such mer. Chelsea's big money duo Timo one at the club's ears. four groups of three. The group winners will advance to the moves. Luckily, on that front, Werner and Kai Havertz arrived to — givemesport.com semi-fi nals. — reuters.com