Return of Indigenisation Act Spooks Investors’: P3

‘RETuRn oF InDIGEnISATIon AcT SpookS InvESToRS’: p3

News Worth Knowing 'Scrap forex duty payments': P5

January 28-February 03 2021 ESTABLISHED 1969 @ FingazLive www.fingaz.co.zw Facebook: The Financial Gazette Z$260

ZSE Report TRADING on the Zimbabwe Stock Exchange (ZSE) closed lower on Wednesday with market breadth Treasury weakening amid 19 stocks retreating due to profit taking and 17 advancing. Big trades in Econet valued at $289,4 million pushed market turnover to $323,6 million from a total volume of 27,3 million shares. The major indices closed in the red with the benchmark The mining Index closed 124,08 points lower. There were no trades on marshals the VFEX. Currencies (Bloomberg) % change ◀ USD:ZAR 15,1178 0,33 EUR:USD 1,2124 0,30 ◀ ◀ GBP:USD 1,3735 0,01 ◀ USD: JPY 103,7900 0,16

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vaccines ◀ nelson Gahadza and vaccines, among other initiatives. Tendai kamhungira “We are pursuing three options. We, as a Soya ZAR 9,015.00 0 Wheat ZAR 5,230,20 14,80 Staff Writers government, have some funding set aside to ◀ purchase the vaccine. The second source is the HE government is exploring a number private sector. Zim’s January of options to fund an expanded roll-out “We are engaging private companies and Tof much-needed Covid-19 vaccines in also having a conversation with the donor com- inflation up the country, as Zimbabweans and the economy munity,” he said. ZIMBABWE'S month-on-month in- continue to reel from the global pandemic. President Emmerson Mnangagwa has al- flation measured by the blended con- This comes as Harare is party to the World ready met with some business leaders who sumer price index in January 2021 Health Organisation-led Global Access Facil- have offered to help finance vaccines. was 2,76 percent, gaining marginally ity, Covax, under which Zimbabwe is set to Meanwhile, economic commentator on the December 2020 rate of 2,75 get three million doses of vaccines, at a cost Gorden Moyo — a former minister of State percent, the statistics agency has said. According to Zimstat the year- of US$25 million — from the 270 million jabs Enterprises has warned against any further on-year inflation for the month of available to Africa. borrowings by the government, or “knee jerk January 2021 as measured by the all- Speaking to The Financial Gazette this decisions” including increasing taxes to fund items blended Consumer Price Index week, Finance minister Mthuli Ncube said the the roll-out of vaccines in the country — as has stood at 191,52 percent. Zimstat ad- African Export-Import Bank (Afreximbank) been mooted in some circles. opted a blended inflation reporting would fund this facility. “I will caution against both increasing taxes system which tracks price changes in In addition, the Treasury boss said, the gov- and borrowing at this time. Borrowing will fur- Solomon nyanhongo, Stanbic Bank Zimbabwe’s new chief executive both the local currency unit and the US$, the country’s two main trading ernment would also utilise its own resources, ther hurt the economy that is currently in deep says the bank plans to continuously increase the number of digital currencies. while also looking at roping in the private sec- pain ... increasing taxes will choke struggling channels for its clients to minimise travel or physical contact. nyanhongo takes over from Joshua Tapambwa, who had been at the helm The Reserve Bank of Zimbabwe, tor and partnering with donors to procure more taxpayers,” he said. To page 2 of the financial institution for the past 12 years. is forecasting annual inflation to fall to a single digit by year end. Page 2 | January 28-February 03 2021 The Financial Gazette News Treasury marshals funds for vaccines From Page 1 of Zimbabwe (RBZ) governor John Man- Rather, Moyo advised, the government gudya was among those who said the ris- should instead seek to urgently plug the ing coronavirus deaths in the country — leakages in the extractive sector of the including that of key managers in both the economy, which would allow it to mobil- private and public sectors — was “quite ise resources to contain the raging corona- devastating on the economy”. virus. “While it’s too early to quantify the “It is common cause that the govern- economic impact of the second wave of ment is losing approximately US$1,8 Covid-19 on the national economy at this billion per year from the gold sub-sector point, given that most of the firms were alone through outbound illicit financial still on their industrial shutdowns and have flows. only just opened, what is true though is that “If you add the figures from diamonds the pandemic has been very severe over the and other precious stones, you will have past few weeks — as the country has lost enough to vaccinate the entire population.” human capital essential to drive the econ- “This should be augmented by the two omy. percent inter-mediated money transfer tax, “It is, therefore, critical that we all con- which should be ring-fenced for this pur- tinue to observe the Covid-19 protocols to pose,” Moyo added. protect ourselves against the virus. Kipson Gundani, an economist and “Human resource is a very critical fac- head of the CEO Africa Roundtable, also tor of production. The loss of human capi- said the government needed to reprioritise tal, of precious life, is thus quite devastat- its expenditure to fund the vaccines rolling on the economy,” Mangudya said. out. “It takes time to train or recruit business “Take money from military votes and executives or professional experts. Apart put it to health. As a people, we are already from the adverse impact on the loss of life, highly taxed ... Any attempt to increase tax the pandemic has also had a fundamen- will dwarf consumer power and seriously tal negative psychological impact on the suppress aggregate demand,” he said. economy, as it is inducing fear in people. Chris Mugaga, the chief executive of “We, therefore, all need to work hard the Zimbabwe National Chamber of Com- to minimise its impact on society and the merce, also said the government could economy. consider using the IMTT tax to help fund “Obviously, the necessary extension of the purchase of vaccines. the lockdown will mean that some busi- “It is a dire situation we are in. Gov- nesses will not be able to operate as nor- ernment finances alone will not be able to mal, and this will thus negatively affect procure the vaccine, given that a number production in some sectors of the economy. of necessities cannot even be funded by the “Our prayers are, therefore, that the meagre available forex. positive impact of the good rainy season “This is also confirming the debate we on the economy will be able to count- have already had that the surplus Ncube er-balance the loss of production due to always boasts about is only of academic the pandemic,” Mangudya further told The relevance. We remain on a fiscal cliff edge. Financial Gazette. “The solution lies in a strong and wide In the meantime, Russia and China public-private partnership, where the gov- have approached Harare about supplying ernment has to partner corporates and vaccines, to help curb the country’s es- introduce a heavily subsidised scheme calating Covid-19 outbreak — and amid to allow for affordability of vaccines by concerns about Zimbabwe’s ability to af- citizens, of which the majority are unem- ford the shots. ployed,” Mugaga said. This comes as local infections have With Zimbabwe’s second wave doubled in the past few weeks, with four Covid-19 deaths and infections soaring ministers and several captains of industry alarmingly in recent weeks, experts have among the more than 1 000 people who expressed serious concerns about the im- have lost their lives to the lethal respirato- pact of the pandemic on the country’s key ry disease since it was first reported in the human capital and the economy. country in March 2020. Speaking in an interview with The Fi- [email protected] nancial Gazette last week, Reserve Bank Zim plans to buy virus shots for two-thirds of population

IMBABWE plans to buy suf- Businesses offered to procure dou- ficient coronavirus vaccines to ble the number of vaccines they need Z inoculate about two-thirds of its for their employees and make half that population, amid a surge in infections amount available to the government and deaths. for use in high-priority individuals The shots will be jointly acquired in the public sector, according to the by the government and private compa- proposal seen by Bloomberg and con- nies, according to a proposal presented firmed by Mangwana. during a meeting between President The Southern African nation plans Emmerson Mnangagwa and business to rely on an immunisation programme leaders in the capital, Harare, on Tues- already in place to roll-out the shots, day. in addition to companies setting aside It didn’t provide details on how spaces at their facilities that will be the purchases will be funded or which used to inoculate staff and their fam- companies will contribute. ilies. The authorities have the capacity A technical team is being assem- to inoculate about 10 million people, bled to identify vaccine options from government spokesperson Nick Mang- the US, Europe, China and India to wana said by text message. “assess the ones most suited for the “Any support goes a long way to infrastructure available in rural and make sure resources are not diverted urban Zimbabwe,” according to the from other sectors,” he said. proposal. — Bloomberg The Financial Gazette January 28-February 03 2021 | Page 3 National News Indigenisation Act return dents confidence ‘China largest FDI Adelaide Moyo against a future which it can only dimly perceive. negative perception about the country as an invest- Staff Writer This places an onus on the regulatory authorities to ment destination that has hurt investment. recipient in 2020’ provide as much certainty as possible within the lim- “This entrenches government control and pos- hE government’s decision to revert to a prej- its they control,” the law firm said. sible undue political interference in the commercial hiNa’s $163 billion in inflows last udicial indigenisation policy on mining has “Foreign direct investment in the mining sector extraction of the country's valuable minerals. ideally, year, compared to $134 billion at- Tsparked panic among investors, with analysts primarily requires a stable, predictable and transpar- the government needs to set up efficient tax collection Ctracted by the United States, the Unit- warning that the move could deter foreign investment ent fiscal and legislative framework that will survive systems, fund exploration and encourage optimum ed Nations Conference on Trade and Devel- into the sector. the life of the investor’s business plan and financial utilisation of all mining claims for the benefit of the opment (UNCTaD) said in a report released President Emmerson Mnangagwa’s government model. economy than to have clauses that scare away free on Sunday. recently amended the indigenisation and Empower- “The regulatory framework must be certain and enterprise,” Bhoroma said. in 2019, the United States had received ment act in Section 36 of the Finance act (No. 2) consistent from one year to the next, because mining he said predictably a number of investors have $251 billion in inflows and China received of 2020, empowering the minister of Finance to indi- is a long-term business in our view, Section 36 does taken a wait and see approach on Zimbabwe as evi- $140 billion. genise any designated mineral that he or she feels in not provide this much needed regulatory certainty.” denced by the sharp decline in foreign direct invest- China’s economy picked up speed in the consultation with the parent ministry. John Robertson, an economist, said the amendment inflows to below US$100 million in 2020. fourth quarter, with growth beating expecta- isaac Kwesu, the Chamber of Mines of Zimba- ment is a serious contradiction to the open for busi- The southern african nation has ambitious plans tions as it ended a rough coronavirus-strik- bwe chief executive, said the amendment — which ness agenda. to improve the business climate which are premised en 2020 in remarkably good shape and re- marks the departure of Finance act No. 1 of 2018 “The message to foreign investors will be that the on improving laws and reforming state enterprises mained poised to expand further this year which restricted a 51:49 shareholding threshold in government cannot be trusted to keep its word. The and parastatals’ but the process has stuttered because favour of locals — had created a lot of confusion in government would do well to forget about the mining of an apparent lack of political will from authorities. even as the global pandemic rages unabated. the industry. sector becoming a US$12 billion industry in the next Resultantly, the burdensome rules have driven China’s gross domestic product grew 2.3 “The industry is taken aback and we are engag- two years, or ever,” he told The Financial Gazette. businesses away from the oversight of regulators and percent in 2020, official data showed last ing the government on this new development. it is “By demanding 51 percent shareholding in ev- tax collectors into the shadows of the informal sector week, making China the only major econo- our hope that we find each other as this has raised ery mine in the country, government will be asking while foreign investors have stayed at bay. my in the world to avoid a contraction last alarm in the investment community. We have been mining investors to inject 100 percent of the needed The indigenisation and Economic Empower- year. inundated with calls to explain whether the provision capital, provide 100 percent of the needed geological, ment act has in the past discouraged and alienated The world’s second-largest economy has is now law and it is our hope that the engagement we technical, and managerial skills, take 100 percent of much-needed foreign direct investment. surprised many with the speed of its recov- are currently doing with the government will bring the risk and forfeit control over the company, all for around 2013, the indigenisation programme ery from the coronavirus jolt, especially as sanity and clarity on this provision,” Kwesu told The only 49 percent of the dividends,” he said. threatened a lawfully and morally binding agreement policymakers have also had to navigate tense Financial Gazette. he added that the act will amount to an act of eco- between the country’s largest platinum producer, US-China relations on trade and other fronts. “We are still trying to work on a common under- nomic sabotage. Zimbabwe Platinum holdings (Zimplats) and gov- Overall, global FDi had collapsed in standing with the government because this has creat- “This casts a deep shadow of uncertainty over ernment. 2020, falling by 42 percent to an estimated ed panic. There is uncertainty among investors,” he a company that is deciding whether or not to invest The miner refused to foot a US$17 million con- $859 billion, from $1,5 trillion in 2019, ac- added. what might be hundreds of millions of dollars in a sultancy bill levied by Brainworks Capital who were cording to the UNCTaD report. according to the amendment, Section 3(1) of new venture. as so much uncertainty already affects contracted by the now-dissolved National indigenisa- “FDI finished 2020 more than 30 percent the indigenisation and Empowerment act [Chapter mining — nobody knows what prices will be like tion and Economic Empowerment Board to structure below the trough after the global financial 14:33] is amended — (a) by the insertion after “ex- when the mine starts working and nobody can be sure and facilitate the empowerment deal. crisis in 2009”, the UNCTaD said on Sun- traction of” of ‘such mineral as may be prescribed of future mining costs — that adding to uncertainty in the National Development Strategy, the gov- day. by the minister in consultation with the minister re- with this amendment might be enough to force proj- ernment aims to move the economy up the value sponsible for mines and the minister responsible for ect cancellations,” he said. chain and domesticating these value chains depend- FDI flows fell by 37 percent in Latin Finance;(b) by the repeal of paragraphs (a) and (b). “No mention is made of whether the government ing on the availability of throughput from sectors american and the Caribbean, by 18 percent Commenting on the development, Manokore at- will pay for shares transferred to it, or contribute to- such as agriculture and mining. in africa, and by 4 percent in developing torneys said the new rules create risk of compulsory wards the costs of expansions that might be needed in The mining sector remains a key driver of Zimba- asia, the report added. surrender of majority shareholding of foreign mining future, so even more uncertainty and risk is generated bwe’s economic development, typically contributing East asia accounted for a third of operations in Zimbabwe. by the amendment.” circa 10 percent to the country’s gross domestic prod- global FDI in 2020, while FDI flows to “Mining is perhaps the most inherently uncer- Victor Bhoroma, another economist said the uct and around 60 percent to exports. developed countries fell by 69 percent. tain of all industries which has to continually hedge move would only add to the policy inconsistency and [email protected] — Reuters Page 4 | January 28-Februay 03 2021 The Financial Gazette News

Zim-UK trade under spotlight Farai Mabeza 8th among 190 economies on the ease of Staff Writer doing business index, according to the latest World Bank annual ratings. IMTRADE says local companies “This is, therefore, a lucrative market should consider widening their which Zimbabwean exporters can target,” Zproduct range of exports into the the ZimTrade chief said. United Kingdom as the two countries en- “With improved access as a result of ter a new trade era after Britain completed the current trade agreement with the EU, its exit from the European Union. we are expecting to see growth in exports Trade between the two countries is to the UK of produce such as avocados, still dominated by commodities such as citrus fruits, stone fruits, pineapples, ap- diamonds which constituted 75 percent of ples, and blueberries. total exports in 2019 but ZimTrade chief “We are already known for producing executive offi cer, Allan Majuru told The quality products that taste better than our Financial Gazette that diversifying would competition and we encourage local ex- give the country a competitive advantage. porters to ride on this reputation, which “Zimbabwe is already renowned for should boost their exports.” quality processed foods such as Mazoe There is also growing demand for and Tanganda Tea, which could be used superfoods both in the UK and EU. Su- to introduce more products into the UK perfoods are products that are considered market,” said Majuru. to have immune boosting properties and “Of interest to farmers is the need to are usually high in protein and vitamins consider organic produce as demand is whilst low in calories. growing rapidly in the UK. There are “... successful product campaigns some small-scale farmers who are al- in the UK have the potential to spiral in ready producing organic products such as EU markets, hence the preferential trade bananas and pineapples. To harness the agreement could be a gateway to EU mar- potential, farmers will need to attain inter- kets,” Majuru said. national certifi cation, which will improve The UK is already one of the largest their penetration in UK.” markets for Zimbabwe’s fresh produce According to the British embassy in and fl owers and expectations are that lo- Harare, trade relations with the UK will cal exporters will continue servicing the not be disrupted as a result of Brexit. They market. will continue under the East and Southern However, disruptions are likely to be Africa (ESA)-UK agreement which cur- experienced by Zimbabwean exporters rently also involves Mauritius and Sey- who were using other EU markets such chelles. as the Netherlands as gateways to the UK. This agreement replicates the intended “Such arrangements will likely affect effects of the ESA-EU interim Economic exports to the UK. This is, however, an Partnership Agreement that was signed opportunity for Zimbabwean exporters to between the ESA States and the EU. create direct links and trade routes to the “…tariff preferences applied by the UK,” Majuru said. UK to goods from Zimbabwe will remain There are also issues to do with gradu- the same as those applied by the EU un- al reduction of duties in ESA countries for der the existing agreement, and likewise, goods originating in the UK. Zimbabwe Zimbabwe will continue to apply the has liberalised 80 percent of its imports same preferences to goods from the UK and excludes products such as cereals, that they are currently applying to goods beverages, paper, plastics and rubber, from the EU,” Majuru said. clothing and textiles, footwear, glass, and The UK market has a population of 67 ceramics as well as consumer electronics million with a GDP of US$2,8 trillion, a and vehicles. GDP capita of US$42 330 and is ranked newsdesk@fi ngaz.co.zw The Financial Gazette January 28-February 03 2021 | Page 5 News ‘Scrap payment of duty in forex’ Tendai Kamhungira eign currency on the Reserve Bank of said. While there has been increased use Senior Staff Writer Zimbabwe’s (RBZ) auction since June 23 The use of the dollar is gaining ground, of the dollar, the government has insist- last year, the parallel market has as people shun the local currency, ed that the economy will not re-dollarise, he government should gradually phase out continued to exist. which was reintroduced in June even though other government depart- payment of duty in foreign currency to boost “Of paramount impor- 2019 as the sole currency of ments, now accept payments in US$. T confidence in the local currency, the Confed- tance is the need for the trade after a 10-year hiatus. With Zimbabwe being a net importer eration of Zimbabwe Industries (CZI) has said. auction to deliver on sus- Barely a year after this of a number of items including defective CZI said fiscal authorities should take seriously tained stability of the ex- decision, the RBZ allowed cars, it has also been losing hundreds of the need to increase the demand for local currency change rate, market de- the use of the US$ as legal millions of dollars of the much-needed by gradually phasing out payment of duties and tax- termined price discovery, tender alongside the local foreign currency. es in foreign currency. exchange rate convergence, currency as a way of cush- Auditor-General Mildred Chiri in a “This would also reduce unnecessary demand for efficiency, and availability ioning businesses against the report recently tabled in Parliament re- foreign currency in the economy, as currently some of foreign currency on the for- global Covid-19 pandemic. vealed that the country imported 239 individuals and companies resort to the parallel mal market. Henry Ruzvidzo The ZWL$ had been aban- 042 second-hand vehicles between Jan- market to get foreign currency to meet their fiscal "This way, it ensures long- doned in February 2009 after it uary 2015 and September 2018, show- obligations and other day to day needs,” the henry term sustainability in the markets. A mar- had become worthless due to hyperinfla- ing that the country gobbled nearly Ruzvidzo-led industry body said in its inflation and ket determined foreign exchange also tion which, according to the International US$200 million during the period. currency developments update for December 2020. ensures efficient allocation of foreign cur- Monetary Fund, had scaled past 500 bil- Although companies have been accessing for- rency,” the business member organisation lion percent. [email protected]

Slow vaccine roll-outs delay economic recovery

he world economy is facing a tougher start to 2021 than expected as coronavirus infections surge and it Ttakes time to roll-out vaccinations. While global growth is still on course to rebound quickly from the recession of last year at some point, it may take longer to ignite and not be as healthy as previously forecast. The World Bank already this month trimmed its prediction to 4 percent in 2021 and the International Monetary Fund will this week update its own outlook. Double-dip recessions are now expected in Japan, the euro area and UK as restrictions to curb the virus’s spread are enforced. Record cases in the US are dragging on retail spending and hiring, prompting President Joe Biden’s new administration to seek an extra $1,9 trillion worth of fiscal stimulus. Only China has managed a V-shaped recovery after containing the disease early, but even there consumers remain wary with Beijing partly locked down. high frequen- cy indicators tracked by Bloomberg Economics point to a troubling start to the year with advanced economies beginning on a weak note and emerging economies diverging. “That’s a reflection of the hard reality that, ahead of widespread distribution of the vaccine, a return to normality is an unlikely prospect,” said Tom Orlik, chief economist at Bloomberg Economics. It’s a stark outlook facing policy makers after $12 trillion worth of fiscal support and trillions in central bank money printing failed to cement a recovery. Those from the Federal Reserve meet this week. even as the economic outlook has darkened as the weeks of 2021 ticked by, financial markets have continued to rally on optimism government stimulus and the vaccine roll out will drive a recovery. Global stocks hit an all-time high last week. The US, Britain and european Union are delivering vaccines, setting up a scenario where some parts of the world reach herd immunity while others lag, especially poorer economies. The World health Organisation (WhO) warned rich nations on Monday that their economies could be hurt unless they help developing countries speed up vaccination programs, the Financial Times reported, citing a study commissioned by the International Chamber of Commerce (ICC). If the roll-out of vaccines in poorer countries maintains its current trajectory, advanced economies faces an output loss of up to $2,4 trillion of their annual gross domestic product before the pandemic because of disruptions to trade and supply chains, the WhO will say based on the ICC research. “While there is light at the end of the tunnel, there is still a long and difficult road ahead before we are out,” said Erik Nielsen, group chief economist at Unicredit SpA. “So long as the pandemic terrorises part of the world, normality will not be restored anywhere.” The optimistic outlook rests on authorities getting the vaccine out on a material scale by mid-year and neutering the threat of more transmissible variants of the virus. The ongoing provision of easy monetary policy and hope that governments won’t pull back their support prematurely as some did after the financial crisis should also assist. Lockdowns and other restrictions on movement also appear to be having less of a detrimental economic impact this time than last year as consumers and business have found ways to adapt. And China’s lead in the global recovery shows what’s possible once the virus is controlled. “The first quarter will be worse than we had thought,” said Shaun Roache, Asia Pacific chief economist at S&P Global Ratings in Singapore. “But we see a delayed, not derailed recovery.” — Bloomberg Page 6 | January 28-February 03 2021 The Financial Gazette National News NRZ misses 2020 targets Adelaide Moyo This lack of capacity really hit us hard Staff Writer in our performance,” Maravanyika said. “While business is plenty out there, HE National Railways of Zim- we also came short on satisfying our cus- babwe (NRZ) says it moved 2,5 tomers with adequate wagons. We need Tmillion tonnes of cargo during the wagons and this wagon gap definitely year ended December 2020, missing its affected us when it came to wagon turn- target by 27 percent, largely due to the over with customers.” detrimental impact of the Covid-19 pan- He said NRZ — which has a design demic. capacity to move 18 million tonnes of The struggling state-owned firm freight a year — needs at least 40 loco- which transported 2,8 million tonnes motives, 300 wagons and 300 coaches in 2019 had set a target of 3,4 million to realise its first steps in turning around tonnes. operations. Nyasha Maravanyika, NRZ public re- “NRZ is in a turnaround stage which lations manager said the rail carrier, just seeks to steer the rail giant to the shores like most sectors, was heavily affected by of breaking even. For us to achieve this the global Covid-19 pandemic. we need to shore up our rolling stock of “Besides affecting our routine work locomotives and wagons,” he said. and schedules, the pandemic also affected NRZ is targeting to move a minimum most of our freight customers especially of 4,5 million tonnes in freight this year. the chrome players in the Midlands. “We want to increase our volumes "With the government declaring the from the current 2,5 million tonnes to pandemic a disaster then announcing over 4,5 million tonnes. Our aim is to a raft of lockdown measures in March break even by improving our volumes to 2020, which only got relaxed around at least 4,5 million tonnes,” he said. July, that meant these chrome miners In 2019, the rail entity missed its could not resume their operations till target 4,2 million tonnes of cargo, only June and July thereabout,” he said. managing to transport 2,8 million tonnes, Traditionally, chrome customers give which again was 17,6 percent less com- significant volumes of business to NRZ. pared with the 2018’s achievement of 3,4 The parastatal has also been affected million tonnes. by dilapidated rail infrastructure and ob- The NRZ board is expected to con- solete equipment, which includes loco- vene a crisis meeting to map the way motives, coaches and wagons. forward in terms of the parastatal’s re- “We also have capacity issues when structuring following the demise of the it comes to traction power (our locomo- entity's acting general manager, Joesph tives). We need to enhance our traction Mashika. power. We need more locomotives. Cur- The meeting will also focus on strat- rently we have old locomotives which egising operations to improve perfor- are past their prime in terms of efficiency. mance. [email protected]

NRZ needs at least 40 locomotives, 300 wagons and 300 coaches to turnaround its waning fortunes. SA starts R12bln fund to help tourism industry OuTH Africa (SA)’s government virus variant in South Africa late last has started a R1,2 billion rand year only exacerbated the situation, S (uS$79,4 million) fund aimed at putting the country on many nations’ reviving its ailing tourism industry. lists of places to avoid. The Tourism Equity Fund will be under normal circumstances, tour- used in particular to help black entre- ism accounts for 2,9 percent of SA’s preneurs start businesses and projects economy and about 1,5 million jobs, in the sector, Tourism minister Mma- President Cyril Ramaphosa said at the moloko Kubayi-Ngubane said Tues- launch. day. “This is a sector that is labour-in- The cash will come from govern- tensive, and therefore, has immense ment, lenders and the Pretoria-based job creation potential,” he said. Small Enterprise Finance Agency, she “It generates foreign-direct invest- said. ment and significant export earnings. Tourism-dependent businesses have It stimulates and supports the develop- been particularly hard hit during the ment of small businesses.” Covid-19 pandemic as border closures The focus on black businesses is and travel restrictions prevent the usu- part of the government’s efforts to im- al flow of holidaymakers from Europe prove economic opportunities to those and elsewhere. discriminated against during apartheid. The identification of a new corona- — Bloomberg The Financial Gazette January 28-February 03 2021 | Page 7 National News AU passport excites tour operators Farai Mabeza travel. The concerns which always existed travellers. Staff Writer on the periphery were on security issues but The African passport is the flagship proj- even with visa travel, there are always is- ect of AU’s Agenda 2063 and aims to re- IMBABWE’s tourism sector is hopeful that sues to do with porosity. move restrictions on Africans ability to trav- the expected rollout of the African Union pass- “Free movement which is supported by el, work and live within their own continent. Zport this year will act as a stimulus for new the necessary regulatory framework will some individual African countries have markets for the country. stand the test of time. It will pass the test. been making improvements on political The initiative which had been stalled by the out- Africa is a big market,” Fundira said. integration within the continent in recent break of the Covid-19 pandemic, was mooted and is AfCFTA aims to bring together 1,3 bil- years. being rolled out as part of the African Continental lion people in a Us$3,4 trillion economic Nigeria, for instance, no longer requires Free Trade Area (AfCFTA). bloc, creating a single market for goods and Africans traveling to the country to apply It is seen as crucial to the AfCFTA’s success as it services in addition to a customs union with for a visa beforehand. will ease travel within the continent and so far, only free movement of both capital and business Winnie Muchanyuka [email protected] government leaders, diplomats, and AU officials have been issued with the passports. “The single Africa passport would be a welcome development for tourism in general as it would do away with restrictions that might have been in place due to visa requirements for certain countries to visit Zimbabwe," Tourism Business Council of Zimbabwe (TBCZ) president, Winnie Muchanyuka told The Fi- nancial Gazette. “The advent of a single African passport would allow fluidity across the continent. This will definitely boost the tourism industry in Zimbabwe as we will begin to explore markets that probably didn’t visit Zim- babwe much because of the labour they would have had to go through to get visas,” she added. Muchanyuka believes that there are many people across the African continent who would love to visit various sites in Zimbabwe such as the iconic Victoria Falls, and believes the new passport, just like what its European Union counterpart did when it was introduced, would make citizens more mobile. The EU passport opened up some European desti- nations to more traffic than what was the norm before it was issued. The TBCZ boss predicted that new direct routes would be established between African countries as a result of this development. “I would envisage that connectivity in Africa would greatly improve as they would be a stimulus for traffic between points that didn’t exist prior to this development. “so, if there is a need for Ghanaians to travel to Zimbabwe to see the Victoria Falls, we would see the opening up of direct flight as opposed to traffic that has been going through the main hubs such as OR Tambo, Nairobi and Addis Ababa. "so, we might see new routes develop because of the flexibility in travel arrangements that would arise...,” Muchanyuka said. safari Operators Association of Zimbabwe president, Emmanuel Fundira, said the move was long overdue. “It will invariably promote a lot of intra-regional Zim seeks Kuvimba listing IMBABWE, banking on mining to end two decades of economic stagnation, plans to list the Zcompany in which it has placed state mining assets to raise cash to meet government obligations, the nation’s finance minister said. Late last year, the government created Kuvimba Mining House, in which the state pension fund and sovereign wealth fund hold 65 percent, to house its holdings in platinum, gold and nickel. It intends to use revenue from the company to meet a laundry list of requirements ranging from compen- sating white farmers for infrastructure on farms that were seized two decades ago to improving pensions. “In the next two years, it will be a highly profitable group,” Finance minister Mthuli Ncube said in an interview last week. “When we eventually list, the government will off- load some of its shareholding.” The creation of Kuvimba, which means trust in the shona, is the latest attempt by the Hara- re administration to kickstart its mining industry. — Bloomberg Page 8 | January 28-February 03 2021 The Financial Gazette Leader Page

News Worth Knowing Covid vaccines: Gvt should break the bank THe global race to secure Covid-19 vaccines is in full swing with the developed nation states acting in typical realist fashion to safeguard their own survival. There are clear indications of hoarding and “vaccine national- ism” despite warnings that the world needs a unified approach. A study commissioned by the International Chamber of Com- merce estimates that the global economy stands to lose as much as $9,2 trillion if governments fail to ensure developing economy access to the vaccines, as much as half of which would fall on advanced economies. While the case for global cooperation is genuine, we too in the developing world should step up to the plate and endeavour to save our people. If ever there was any reason to beg, borrow or steal then this is it. The government should do whatever it takes to get the vaccines. Admittedly, Zimbabwe’s coffers are obviously — dry and — thin to buy sufficient amounts or quantities of the vaccine, but this is the time for our leaders to be seen as going out of their way to ensure every possible option to secure the much-needed medicines. In the past, Harare has borrowed and even gone to the extent of mortgaging future mineral revenues for far less important HEALTH TIME-BOMB: A heap of uncollected garbage near Mupedzanhamo Market in Mbare, Harare. The city council things needs. As we speak, the government is being sued be- said it was already struggling to make payments to service providers to ensure adequate water provision as well as fore the courts to publish all loans and guarantees contracted by refuse collection after Zimra garnished $115 million from its bank accounts over unpaid tax arrears. President Emmerson Mnangagwa’s administration since 2017. And the actual extent of that debt still remains a mystery with authorities giving conflicting positions. While there is cautious optimism on the government’s engagement prospects with the private sector on ways of funding that Now is the time for vaccination programme, the state is pointedly pinning its hopes on an insufficient African Union Covax facility Under the continental initiative, only World Health Oorgan- isation (WHO)-approved vaccines can be bought. So far, only Pfizer's has been listed for emergency use by the WHO. The pro- US-Zim relations reset cess to approve Moderna and Astrazeneza vaccines is ongoing. HERE is no better time for the tance by the West. Lack of dialogue indigenisation policy by opening all More developed countries, including America and the Eu- United States to reset relations risks pushing Zimbabwe further into sectors of the economy to foreign in- ropean EU states have regulatory agencies that "complement" Twith a foreign country than at China and Russia’s sphere of influ- vestors. The local monopoly of invest- WHO's work and could therefore roll out vaccines without the the change of an administration. ence. ment in the mining of platinum, gold body's approval but the rest of us in the developing world rely While the new president, Joe It would be a mistake for the Biden and diamonds has ended. on the WHO to do the due diligence. Biden, will no doubt have a busy administration to overlook Zimbabwe Second, approximately US$3,5 And indeed, the private sector and Mnangagwa engagements agenda, a key priority should be how as a partner in the region, not least be- billion is set to be paid in compensa- are not only heartening, but a commendable effort considering to re-engage with sub-Saharan Afri- cause of the strategic and economic tion to white farmers whose land was ca. The good news is that it’s already opportunities available to American expropriated by the government to the impact the disease has had on earnings and human capital. something about which the president companies. Zimbabwe has all the in- resettle black families, moving much Apart from this, the pledges by western counties such as Brit- has given a great deal of thought. gredients to prosper; untapped human closer to resolving one the most divi- ain are giving us a bit of hope! “Helping Africa capitalise on the capital with one of Africa’s highest sive policies of the Mugabe era. opportunities and manage the chal- literacy rates, a rich mineral base and These positive steps, along with lenges of a burgeoning population is some of the best conditions for farm- several others, bode well for the fu- in our shared interest (and) provides ing on the continent. ture but have been unrewarded and opportunities for American businesses unrecognised internationally. The to access new markets and consumers, good news is that the Biden foreign EDITORIAL MARKETING including in Africa’s growing cities,” Open Forum policy team will have experienced Advertising Manager said Biden, speaking in 2019 at the professionals such as Secretary of Council of Foreign Relations, a US with State-nominee Antony Blinken and Deputy Editor Brand Executive Sales & Advertising think-tank. Linda Thomas-Greenfield, the new Africa’s role in global affairs is US ambassador-designee to the Unit- Senior Assistant Editor Marc Holtzman Senior Sales Consultant only going to grow in the coming de- ed Nations. cades, given that by 2050, Africa will They know Africa well. It would Markets Editor Senior Sales Executives account for 25 percent of the world’s Zimbabwe is said to be among be an extremely positive step if the Companies Editor population. In a report last year, McK- the most richly mineralised countries new president’s team re-engages with insey predicted US$5,6 trillion in Af- on the planet. It is among the top 10 Zimbabwe to make clear what is ex- Sales Representatives - Harare Group Digital Editor rican business opportunities by 2025. producers of lithium, the essential pected so that the tremendous poten- While risks remain, statistics such ingredient in the batteries that power tial of its people can be realized. Chief Sub Editor Sales Representative - Bulawayo as these highlight the major opportu- the technology of the new industrial This would also remove some of Clever Pedzisai: [email protected] nities awaiting potential investors in revolution. the uncertainty for investors. For ex- Staff Writers Brand Executive - Events Africa. No African country is in more More conventionally, it has some ample, the sanctions that exist today need of a reset with the United States of the world’s largest platinum and are on individuals, not on Zimbabwe Brand Executive - Subscriptions than Zimbabwe. Zimbabwe-US rela- chromium reserves. The true scale of as a country, though at present they Farai Mabeza: mabezaf@ﬁngaz.co.zw tions have been strained ever since the Zimbabwe’s mineral wealth is one act as a general deterrent to all foreign Senior Photographer Subscriptions Representatives administration of George W. Bush im- of the last great unknowns in the ex- investors who fear falling foul of any posed sanctions on former President tractive sector, with large deposits of regulations. Production Supervisor Robert Mugabe and members of his gold, chromium, coal, tin, copper and A productive US-Zimbabwe re- inner circle nearly 20 years ago. natural gas yet to be fully explored. lationship makes sense on all levels. Sanctions were extended in March For adventurous investors who get Zimbabwe currently is the US’s 174th 2020, with the US accusing President in early, Zimbabwe promises to be a largest trading partner with US$87 Emmerson Mnangagwa’s govern- highly lucrative market. million in total goods traded during ment of cracking down on opposition In more than 30 years of working 2019. This is a fraction of the vast figures and failing to implement the in places as diverse as Russia, China, economic opportunities to be realized reforms promised when he came to Kazakhstan, Rwanda and Ghana, I be- and enjoyed by the United States and power in late 2017. lieve Zimbabwe is one of the greatest Zimbabwe. But missing the opportunity to emerging market opportunities I’ve n Holtzman is chairman of VOLUNTARY MEDIA COUNCIL OF ZIMBABWE re-engage with Zimbabwe would be ever seen. CBZ Holdings, Zimbabwe’s largest e Financial Gazette newspaper subscribes to a Code of Conduct that promotes truthful, accurate, fair and balanced a mistake at both the diplomatic and At a political level too, some of the financial institution. He is a former news reporting. If we do not meet these standards, register your complaints with the Voluntary Media Council of Zimbabwe at: economic level. The country’s leaders long called for economic reforms have vice chairman of Barclays and for- No 34 Colenbrander Rd, Milton Park, Harare. Telephone: 04-778096 / 778006 24 Hr Complaints line: 0772 125 659 are frustrated that there are no clear taken place. First, the Zimbabwean mer president of the University of Email: [email protected] or [email protected] Twitter: @vmcz http://www.vmcz.co.zw | Facebook page: vmcz Zimbabwe targets for it to meet to gain accep- government has reformed Mugabe’s Denver. The Financial Gazette January 28-February 03 2021 | Page 9 National News Restrictive trading hours impact NTS sales

Adelaide Moyo Staff Writer

ATIONAL Tyre Services Old Mutual in profit warning (NTS)'s sales volumes declined by 21 percent to $189,8 Nelson Gahadza ed December 31, 2020 were R188 bil- N Staff Writer lion, 10 percent up on the prior year. million during the half year to Septem- ber 30, 2020 after restrictive lockdown Positive net client cash fl ow of measures impacted production and LD Mutual Limited (OML) an- R10,1 billion was R7 billion higher trading hours as well as access to sup- ticipates earnings for the year than the prior year, driven by strong pliers. Oended December 31, 2020 to investment fl ows across the group in James Moyo, NTS chairperson, be more than 20 percent lower com- the second half of the period, which said despite the challenges, the tyre pared to prior year due to the signif- were partially offset by higher out- distributor and retailer recorded a 17 icant impact of Covid-19 on business fl ows in Old Mutual Corporate as a percent increase in new tyre unit sales The tyre distributor recorded improved profi t margins on all product operations. result of the deteriorating economic compared to last year. service lines. OML primary share listing is on the environment. “The current Covid-19 pandemic gain released during the period under He said developments coupled with Johannesburg Stock Exchange (JSE) “We have also seen continued im- brought unprecedented challenges to review. The tyre distributor recorded support from the company’s bankers and a secondary listing on the Zimba- provement in adviser productivity the company’s retail and production improved profi t margins on all product resulted in increased inventories which bwe Stock Exchange (ZSE), Malawi with sales trending towards historic operations. Retail branches closed in service lines. in turn drove sales up. and Namibia. It also has a standard levels.” April and May 2020 following the Moyo said capital expenditure was He, however, said the outlook re- listing on the London Stock Exchange. OML noted that while there are en- government's directive to curtail the contained during the period as part of mains challenging. “We expect headline earnings per couraging signs of recovery in sales spread of coronavirus. Once opened, the overall efforts to preserve cash “The outlook remains challenging share (HEPS) and earnings per share metrics, it is concerned about the business was affected by the restrictive resources. NTS bank borrowings de- although we are encouraged by the (EPS) for the year to be more than 20 rapidly increasing rate of Covid-19 lockdown measures, which impacted creased by 65 percent compared to the momentum from the relative stability percent lower than the reported HEPS infections in key geographies and the production and trading hours as well as beginning of the period which is most- in the operating environment. We ex- of 236,1 cents in 2019 and EPS of impact that the pandemic could have access to suppliers,” Moyo said in an ly attributable to the effects of infl ation. pect infl ation to gradually decline and 208,3 cents due to the signifi cant im- on customers, economic recovery, and update this week. Moyo said while the operating en- the stability in prices witnessed in the pact Covid-19 has had on our business mortality rates. Retreading operations were nega- vironment remains challenging, some past six months to sustain the remain- operations and results,” the group said “We are currently in the process tively affected by lockdown closures key changes in economic fundamentals der of the trading period,” Moyo said. in its preliminary operating update. of fi nalising our life reserves, con- as the fi rm's largest customers, the fl eet resulted in an improvement in NTS’ “The agricultural season has also The group noted that operating sidering the global experience of the operators, struggled to return to nor- fortunes. started positively and bodes well for conditions across its business re- impact of the pandemic and the poten- mal business during the period under “In particular, we had increased the nation in general. This and the pro- mained challenging during the second tial of a more sustained spread of the review. cost-effective production uptime due to jected positive growth in the economy half of 2020. virus,” the group said. NTS recorded a profi t of $35,2 mil- more frequent availability of electrici- in 2021 is expected to increase the de- “Despite the tough economic and It added that there remains a large lion during the half year to September ty and fuel over the fi rst half of the fi - mand for our products.” operating environment many of our degree of variability in the data and 30, 2020 compared to a loss of $16,9 nancial year. The company’s access to The company did not declare volume related key performance indi- is monitoring infection and mortality million recorded in the comparable foreign currency through the Reserve a dividend during the half year in cators have shown recovery in the sec- related claims data on a weekly basis period. Other income, made up large- Bank of Zimbabwe auction system view of the need to conserve work- ond half, demonstrating the resilience and expects to communicate the out- ly of rental income and foreign cur- which was introduced in June 2020 ing capital and reinvest in build- of our franchise,” the group said. come in the near term. rency exchange gain, at $14,2 million also improved and resulted in stable ing inventories for the peak period. Gross fl ows for the 12 months end- newsdesk@fi ngaz.co.zw was spurred by the foreign exchange prices,” he said. newsdesk@fi ngaz.co.zw Page 10 | January 28-February 03 2021 The Financial Gazette News Zim among worst affected by extreme weather Farai Mabeza Staff Writer Covid-19 hammers property sector IMBABWE, Mozambique and IMBABWE’S property sector took and lead the economic recovery in 2021. the Bahamas were the countries a severe beating last year due the “Covid-19 pandemic, hyperinflation as Zmost affected by the impacts of Covid-19 pandemic, which resulted well as the 2019/20 poor agricultural sea- extreme weather events in 2019 fol- Z in high voids and rental arrears, a research son constrained the country’s economic lowed by Japan, Malawi and Afghan- firm has said. prospects for 2021,” the firm said. istan, a new report shows. In its portfolio manager’s digest for “...Annual inflation breached the 800 According to the Global Climate 2020, Old Mutual Securities (Omsec) said percent mark in July 2020 and later sub- Risk Index 2021, Zimbabwe lost 4,26 the country’s commercial and residential sided to 401,79 percent in November as the percent of its Gross Domestic Prod- property sector reeled from the double economy is starved of the local currency,” uct (GDP) in 2019 when Cyclone Idai Cyclone Idai left a trail of destruction in the eastern parts of the country. whammy of a long-standing econom- Omsec said. ripped through the eastern parts of the and many others missing and caused nities that have been hit by cyclones are ic crisis and the worsening effects of the During the year under review, the Re- country causing widespread destruc- as much as US$622 million worth of often left more vulnerable to other haz- Covid-19 pandemic. serve Bank of Zimbabwe’s (RBZ) foreign tion to infrastructure, property, crops damage. The storm left the country in ards and the impacts of climate change. “This saw both sales and rentals plum- currency auction, stabilised the exchange and loss of life. need of US$1,1 billion to “build back “In order to ensure better protection meting precipitously, as hard-pressed busi- rate around US$1:ZW$81. nesses and consumers became increasingly RBZ took measures to curtail forex Mozambique lost 12,16 percent better”, according to the World Bank. of the affected populations, adaptation unable to afford rentals or buy building ma- trading on the parallel market, particularly while the Bahamas lost 31,59 percent. The cyclone pummelled Chimani- measures and integrated risk manage- terials for construction. restrictions placed on trading through Eco- “In March 2019, the intense tropical mani and parts of Chipinge at night, ment strategies are required that in- “Reduced economic activity due to the cash and liquidating 20 percent of foreign Cyclone Idai hit Mozambique, Zimba- finding both the local communities and clude the key steps of risk assessment, bwe and Malawi, causing catastrophic Covid-19 pandemic and higher voids cou- currency revenues in companies’ nostro government totally unprepared. risk reduction, risk retention and trans- pled by rental arrears has seen property accounts. damage and a humanitarian crisis in The road infrastructure was grossly fer, preparedness, as well as response all three countries quickly becoming yields remaining depressed. High financing “The local currency’s performance damaged with more than 90 percent of and recovery,” the index said. costs as well as the high cost of building trend on the interbank market has been one the deadliest and costliest tropical cy- the road networks in Chimanimani and Bahamas was hit by Hurricane materials for new property developments of depreciation, trading at ZW$16,80:US$1 clone in the South-West Indian Ocean, Chipinge being negatively affected, Dorian in September 2019. The catego- will see property prices remaining relative- on January 1, 2020 and closing on Decem- Idai was labelled as one of the worst including 584 km of the roads being ry five hurricane was the most power- ly high when compared to regional peers. ber 31, 2020 at ZW$81,79. This represents weather-related catastrophes in the his- damaged by landslides. ful hurricane on record to hit the island In the outlook we expect a nascent recovery a currency depreciation of 388 percent, tory of Africa by United Nations sec- Overall, 50 000 households were state. It caused damage worth US$3,4 in this sector that will be linked to the level raising the risk associated with trying to use retary-general António Guterres,” the affected and over 60 000 people were billion and damaged or destroyed 13 of economic activity,” Omsec said. the local currency as a store of value or me- report said. displaced in the country. 000 houses. Going forward, Omsec said the property dium of exchange,” Omsec said. The torrential rains and destructive “The impact of the tropical cyclones The Global Climate Risk Index and equity sectors would remain attractive The firm said the Covid-19 second wave winds with top speeds of 195 kilome- in 2019 again sends a stark signal that 2021 analyses and ranks to what ex- in the short to intermediate term, while coupled with high inflation threatened the tres per hour caused flash floods and knowledge about and pre-hazard re- tent countries and regions have been money market investments are constrained stability and all the macro-economic gains landslides, which caused economic sponses to existing vulnerabilities and affected by impacts of climate related by current inflationary concerns. that were achieved towards the end of 2020. losses amounting to US$ 2,2 billion in risk exposure remains a critical issue extreme weather events such as storms, “Money market interest rates are likely “Unless this is resolved through the three southern African neighbours — even more so with climate change floods, and heatwaves. to be revised upwards in order to promote confidence building monetary re- while affecting three million people playing an increasing role in the inten- The most recent data available for savings and provide the liquidity necessary forms, the business outlook for 2021 and causing over 1 000 fatalities. sity of tropical cyclones,” the Global 2019 and from 2000 to 2019 was taken for investments.” remains one of uncertainty and a depre- In Zimbabwe it affected more than Climate Risk Index 2021 said. into account in the latest index. The firm said Zimbabwe needs to pro- ciation of the local currency,” it said. 270 000 people, leaving over 340 dead Experts say countries and commu- [email protected] duce competitively priced goods and val- — Staff Writer. ue-added products in order to spur exports [email protected] January 28-February 03 2021 Page 11 The Financial Gazette Companies&Markets BRIEFS Madzikanda leads Zera board Afsun threatens NERGY minister Zhemu Soda says the new Zim- babwe Energy Regulatory Authority (Zera) board’s Emandate is to “ensure a stable energy pricing and management policy regime”, which bolsters the country’s current macroeconomic stability. This comes as the Muzarabani North legislator has recently announced a seven-member board led by strate- legal action gic management consultant and electrical engineer David Madzikanda. “We expect the new board to ensure that issues of corporate governance are upheld, considering it’s a regulatory organisation. We also expect the board to unlock ... as Dawn minorities hold up takeover value... in power production,” Soda said. “If it is issues to do with power purchase agreements, we need... proper advice... At the moment, power is in- Nelson Gahadza adequate because we have investors who are not doing Staff Writer anything. We also want them to advance green, solar output,” he said. FRICAN Sun (Afsun) this week The other members of the new Zera board include vice threatened to drag minority share- chairperson Farai Mavhiya, ex-Total and petroleum sec- holders in Dawn Properties (Dawn) tor executive Masimba Kambarami, Tambudzai Madzi- A vire, Thembelani Ncube, Sosten Ziuku and recently ap- to court if they refuse to accept an offer to sell their stock in a takeover of the company. pointed chief executive Eddington Mazambani. Already, Afsun has acquired a 91 percent A current dean of the University of Zimbabwe (UZ) stake in the real estate company, but a sec- faculty of commerce, Madzikanda is a corporate gover- tion of shareholders representing a combined nance guru and former Zesa Holdings head of its systems planning department, chairman of the Southern African 8,94 percent ownership is still resisting the Power Pool and Kuwait Maastricht Business School lec- deal. turer. “Holders of the remaining shares are In his glittering career, the 61-year old project manag- hereby notified of Afsun’s intention to, with- er, researcher and chartered electrical engineer has also in a period of 120 days… squeeze out any distinguished himself as an advisor, and consultant for such remaining shares whose holders shall regional energy investments worth US$10 million under not have accepted the original offer,” the hos- the World Bank group and other global organisations. pitality group said in a statement. An entrepreneurship guru, Madzikanda has also “In this regard, Afsun shall apply to the lectured at the University of Wales’ Cardiff Business Harare Magistrates Court for an order whose School and served as the UZ’s business review journal. ultimate effect would be to entitle Afsun to — Staff Writer acquire all such remaining shares,” read the statement. ICONIC British bootmaker Dr. Martens is expected to begin an initial share Afsun is offering one share for every sale on Monday that could value it in excess of 3 billion pounds (US$4,1 billion), Covid-19: Edgars goes online 3,988075946 Dawn shares, and has said it Bloomberg reported this week. Picture:Bloomberg intends to eventually delist the company. DGARS Stores (Edgars)’ retail operations, Ed- Afsun’s plan to acquire the entire share gars and Jet, are trading via their online shops and capital of Dawn in exchange for its own 3,89 percent opposed it. phant Hills Hotel in Victoria Falls, Crowne WhatsApp business platforms in a bid to keep the shares was first announced in June last year, Excluding Arden, 86,15 percent were for Plaza Monomotapa Hotel in Harare, Express E business operational and serving customer needs during and subsequently approved by the property the deal, while 13,86 percent were against it. Holiday Inn in Beitbridge and Troutbeck Ho- the current Covid-19 lockdown. company’s shareholders in October. According to Lloyd Mhishi, Dawn’s tel in Nyanga. The clothing retailer closed its stores to walk-in cus- Minorities, however, opposed the deal board chairman, the consolidation is meant The hotels were in turn leased to Afsun tomers for the duration of the lockdown period that com- from the onset. to unlock cost savings through the rational- for 50 years. menced on January 5 in the wake of increased Covid-19 The Securities and Exchange Commis- isation of structural efficiencies, which he The relationship between the two com- infections and deaths, which have claimed over 1 000 sion Zimbabwe had also raised concerns over says will remove duplication, procurement panies would not be without spectacle as lives in Zimbabwe. the transaction, citing potential shareholder efficiencies and “constructive leveraging of Dawn at one point dragged ASL to court for The group also has a Bulawayo based manufacturing prejudice. capital permitting cheaper pricing of debt”. allegedly failing to pay its rentals on time and unit — Carousel— and a financial services unit which At the extraordinary general meeting in Afsun unbundled and separately listed other violations relating to maintenance of houses the retail chain credit facilities and Club Plus Mi- October, voting was split into two phases to Dawn as the first property counter on the the properties. cro Finance unit. show the effect of voting excluding Arden Zimbabwe Stock Exchange in 2003. In 2014 African Sun would dispose of its “These complimentary units will remain functional to Capital (Arden), which holds a 51,93 percent The 2003 unbundling saw Afsun retain stake in Dawn to Lengrah Investments, a sub- facilitate the online business transactions and to ensure stake in the company. a 19 percent stake in the new entity while sidiary of Brainworks Capital (later Arden). accounts are kept up to date for the Edgars and Jet retail In polling that included Arden, which is Dawn walked away with eight hotel prop- This was after Brainworks had acquired a chains as well as Club Plus,” Tjeludo Ndlovu, the group’s also a major shareholder in Afsun, 96,11 per- erties — Hwange Safari Lodge, Holiday Inn controlling stake in Afsun. chief executive said in a statement. — Staff Writer cent voted in favour of the transaction, while Mutare, Carribea Bay Sun in Kariba, Ele- [email protected] Page 12 | January 28-February 03 2021 The Financial Gazette Companies & Markets BNC ‘cautiously’ bullish on nickel prices Farai Mabeza by positive data from coronavirus vac- market recovered from the economic centrate sales following the termination of a local company, Kuvimba. Staff Writer cines drug trials, anticipated economic fallout caused by the virus. of its off-take agreement with Glencore Since that deal, there have been a recoveries and unprecedented stimulus Physical demand recovered due to resulting in a 12 percent decline in rev- number of director changes at the com- INDURA Nickel Corporation packages from central banks globally,” unprecedented stimulus packages rolled enue to US$25 million from US$28,3. pany, including the retirement of former (BNC) says it is optimistic that the Zimbabwe Stock Exchange-listed out by central banks globally in order to The company reported that it had managing director Batirai Manhando, Bthe current upward momentum nickel miner said, adding that the conta- resuscitate economies in their respec- continued to maintain overdraft facili- who was replaced by Thomas Lusiya- on prices will sustain despite geopo- gion, however, continues to have mixed tive countries. ties in order to finance its working capi- no. [email protected] litical tensions and surges in Covid-19 implications on the short-term outlook The Chinese government made tal requirements. cases. “with potential supply disruptions being funds available for local stockpiling of BNC has nickel resources across Nickel prices increased from an av- supportive of price increases whilst the metal and infrastructural development Zimbabwe under mining, processing “The nickel market erage of US$13 000 to US$17 000 per threat of a second wave of lockdowns projects. and exploration assets, including; Tro- is cautiously bullish tonne in 2020. that could dent demand cannot be dis- Speculative buying after statements jan Mine, Shangani Mine and Hunter’s with previous sensi- “The nickel market is cautious- counted”. from electric vehicle manufacturing Road. tivity to the macro-en- ly bullish with previous sensitivity to Prices of the base metal that is companies regarding potential nickel In 2019, Sotic — a Mauritius-based vironment, Sino-USA the macro-environment, Sino-USA used in batteries, which lately has seen shortages also saw prices rallying. company backed by an investment fund geopolitical tensions and surges in the heightened demand due to the rising BNC says the global nickel market in the Cayman Islands — bought 74,73 geopolitical tensions Covid-19 cases being outweighed by an eminence of electric vehicles, dipped remains well supplied as the global percent of BNC from Asa Resources for and surges in the increasingly positive sentiment,” BNC below US$12 000 in April after the economic recovery has been sluggish ZW$3,5 billion. Covid-19 cases being said in its results for the six months to global economy suffered initial shocks with the exception of the Chinese steel The transaction was completed in outweighed by an September 2020, which were published of the novel coronavirus pandemic. sector. September last year. Soon after, BNC increasingly positive recently. Price gains were, however, later ex- During the half year under review announced that Sotic would place the “This sentiment is being bolstered perienced as the Asian stainless-steel BNC saw a 15 percent reduction in con- 74,74 percent BNC shares in the hands sentiment”

‘Stock market volatility to persist in 2021’ OLATILITY on the Zimbabwe Stock Exchange (ZSE) is likely to persist in 2020 as investors are Vexpected to keep taking positions in equities as a currency hedge, a research firm has said. Over the past few years, the stock market has experienced wild swings on the back of a currency crisis that has seen the country’s inflation getting as high as 700 percent. In its portfolio managers’ digest for the full year to December 2020, Old Mutual Securities (Omsec) said share prices are expected to continue to rise in nominal terms, but will likely remain subdued in real terms. “Companies that have significant balance sheets and access to foreign currency are expected to fare better than the smaller companies in the outlook period,” Om- sec said. The market posted record gains in 2020 with the benchmark All Share Index climbing 1 045,84 percent to close the year at 2 636,34 points. Its capitalisation grew by 968 percent to $317,9 billion. This was despite a myriad challenge faced by most companies during the year, including foreign currency shortages and a Covid-19 induced national lockdown that significantly suppressed demand. “Business conditions have remained difficult owing to the Covid-19 induced lockdown, high inflation and reduced demand,” Omsec said. Financial results released last year revealed sales volume shrinkage for most consumer sector companies whose markets are largely local. However, significant improvements in earnings on a historical basis have been recorded due to inflation and a weakening local currency. “These trends are likely to persist in 2021. A key risk that has emerged for listed companies in general has been a weakening currency, which has put a strain on balance sheets as foreign liabilities are revalued upwards against assets denominated in local currency,” the firm said. The total value of shares that traded on the ZSE in 2020 was $ 17,3 billion. Foreign investors were net sellers of $5,42 billion worth of equities and accounted for 22,8 percent of all trades. CBZ Holdings led the pack with a return of 12 093,37 percent, followed by Masimba Holdings at 6 533,19 percent. Notable events on the local bourse in 2020 included a five-week suspension of trading, which was lifted on August 3, the suspension of trading in dually listed shares and the opening of a US dollar-based market, the Victoria Falls Stock Exchange. – Staff Writer The Financial Gazette January 28-February 03 2021 | Page 13 Companies & Markets Lockdown distresses retailers Nelson Gahadza services while compounding operating pacted on volumes. perienced a retreat of 32 percent for the Staff Writer costs against declined revenue and these “The reduced hours are making it ex- three months from April 1, 2020 to 30 are the pains and losses attributable to the tremely diffi cult to re-stock our outlets,” June 2020,” he said in emailed responses ETAILERS say they have seen Covid-19 pandemic,” Denford Mutashu, he said, adding that “increased diffi cul- to this publication. reduced volumes and increased the Confederation of Zimbabwe Retail- ties have led to greater expenses”. He said the company had seen more Roperating costs due to the current ers president, told The Financial Gazette “This will inevitably put upward signifi cant volume reduction at stores in national Covid-19 lockdown. this week. pressure on prices, if not immediately, business districts and major towns. Experts had warned that the potential He said the lockdown has led to in time.” “Business is however reasonable in damage to business and the recovering countrywide store closures, adding that He also confi rmed that stores in busi- suburban stores and country stores,” Si- economy of the second lockdown — a number of players in the sector were ness districts “have been hardest hit” and yavora said. meant to curb resurgent deaths and infec- now pivoting to expand onto the internet. “travel delays are slowing deliveries, He noted that there have also been tions — could be “immense”, especially “Most are going online and we urge therefore making distribution much less disruptions to distribution, mainly due to if this is to be extended. the small to medium sector to direct their effi cient and more costly”. the curfew and the limited trading hours. Under the 30-day lockdown, which business through the channel of electron- Going forward, he said the main ob- “In the short to medium term, Ok Alex Siyavora came into effect on January 5, retailers ic-commerce,” he said. jective will be to re-establish operational Zimbabwe’s plan is to protect the safety are only allowed to open stores from Mutashu noted that goods supplies “Most local suppliers have increased effi ciencies and service levels, which he and health of staff and customers by fol- 0800 hours to 1500 hours and there is a have also declined as only manufacturers prices by a signifi cant margin forcing warned might “take time”. lowing the World Health Organization dusk-to-dawn curfew, while movement and suppliers of essential goods and ser- retailers and wholesalers to adjust prices Alex Siyavora, Ok Zimbabwe’s chief precautions of wearing masks correctly, into business districts around the country vices are allowed to operate. In addition, upwards.” executive said while it was too early for sanitizing, social distancing, decontami- has been restricted. he said there has been upward pressures Hilton Macklin, the chairman of the the retail giant to quantify the losses, nating facilities and support systems for “Short trading hours naturally reduce on prices as a result of a “drastic” reduc- Retail Association of Zimbabwe, also “volumes have defi nitely dropped”. staff that fall sick from Covid-19,” he customer volume, uptake of goods and tion in imports of fi nished goods. said reduced hours had negatively im- “Going by the fi rst lockdown, we ex- said. newdesk@fi ngaz.co.zw New investor prospect excites FMH Nelson Gahadza Staff Writer

IRST Mutual Hold- ings (FMH) has wel- Fcomed a prospective share disposal by its majority owner, National Social Security Authority (Nssa), saying a new investor could bolster its growth prospects. In 2015, FMH aban- doned efforts to bring in a Arthur Manase “technical investor” after potential suitors from South Africa pulled out of discussions citing an uncertain economic environment in Zim- babwe. But now, Nssa intends to sell a 31,22 percent stake, from its 66,22 percent holding in the fi nancial services group, to a “strategic partner”. “This move will… bring in a strategic investor with solid fi nancial resources, synergistic, technical and strategic benefi ts that will enhance the growth prospects of the group,” FMH said last week in a statement. The size of Nssa’s current holding in FMH is in con- travention of local pension fund regulations and capital market rules, thus the partial divesture is primarily meant to deal with this long-standing compliance issue. “Nssa has been non-compliant since 2012 and now intends to be a responsible corporate entity in line with its new values of transparency, honesty and accountabil- ity. “Nssa also needs to share its investment risk in line with good corporate governance,” Arthur Manase, the pension fund’s chief executive said in a statement. The recently appointed chief executive, however, says Nssa is also taking the opportunity to bring in strategic investment with “benefi ts to catapult FMH into a regional insurance powerhouse”. Currently, the fund is looking for suitors to take up the shares it intends to sell. After the proposed transaction, Nssa will remain the single largest shareholder in FMH, which is an active counter on the Zimbabwe Stock Exchange (ZSE) and has a market capitalisation of about $6,6 billion. The group has diverse interests in real estate, insurance and other fi nancial services. According to a trading update for the nine months to September 30, 2020, FMH’s total income during the period was 14 percent higher than the prior comparable period, “refl ecting fair value gains on investment properties and positive returns on listed equity investments”. Last year, the group relocated its reinsurance business, First Mutual Reinsurance Company, to Botswana to escape the limitations of the local operating environment, which has been fouled by a chronic currency crisis. In 2017, NicozDiamond was merged into FMH through a disposal of Nssa’s stake in the short-term in- surer in exchange for shares in the latter. The transaction is said to have helped strengthen the group’s short-term insurance business and “solidifi ed its market standing as one of the leading insurers in the country”. newsdesk@fi ngaz.co.zw Page 14 | January 28-February 03 2021 The Financial Gazette Companies & Markets Delta steps up foreign debt repayment

Adelaide Moyo Delta said last week in a trading up- thorities had banned the use of for- infl ation adjusted terms, refl ecting a Staff Writer date for the nine months to December eign currencies in local transactions, signifi cant volume recovery across 2020, adding that it has made “steady but this was reversed in 2020 to cush- all its beverage categories as well as ELTA Corporation (Delta) progress” in the settlement of a loan ion the economy from shocks associ- “attention to replacement cost-based says improved access to for- for the acquisition of United National ated with the Covid-19 pandemic. pricing”. Deign currency from domestic Breweries, South Africa (UNB). And this, a number of companies The company’s lager beer volume sales has allowed it to make progress The company last year conclud- that include British American To- grew 48 percent for the quarter and in settling foreign obligations. ed a 100 percent acquisition of the bacco and United Refi neries, say to- 20 percent for the nine months com- Due to foreign currency shortages leading producer of traditional beer gether with the reserve bank’s weekly pared to the same period last year, in Zimbabwe, the beverages man- and allied products in South Africa, currency auctions – also introduced attributed to the competitive pricing ufacturer has in the past faced chal- for a consideration of R635 million in 2020 – has improved access to for- and consistent product supply, “ben- lenges expatriating funds, including (US$42 million). eign currency. efi ting from the injection of new re- dividend payments to foreign share- In 2019, when the government Delta said improvements in access turnable glass and fewer disruptions holders. reintroduced the ZW$, it committed, to foreign currency have also resulted to production operations”. “The group has benefi ted from the through the RBZ, to assuming private in stable pricing and consistent prod- The South African unit, UNB, re- improved access to foreign currency companies’ foreign legacy debt – uct supply “due to better access to corded a year-on-year decline of 19 through domestic Nostro sales. The longstanding due to foreign currency imported raw materials and spares”. percent for the quarter as the country foreign currency is being prioritised shortages – at a rate of 1:1 with the The company says it recorded a has implemented very strict restric- towards settlement of the legacy debts US$, but the execution of this pledge revenue increase of 77 percent during tions and bans on the sale and con- in line with the arrangements with the has delayed with industry expressing the quarter to December 2020, and sumption of alcohol. To support the domestic unit, au- Reserve Bank of Zimbabwe (RBZ),” concern over its uncertainty. 33 percent for the year-to-date, in newsdesk@fi ngaz.co.zw

AL R ION AP T I SeedCo merger: A D N Control

R E M S A P O T E block acquired MINISTRY OF TRANSPORT AND INFRASTRUCTURALN S E DEVELOPMENT Nelson Gahadza Creating an enabling environment for transport and infrastructural development in Zimbabwe Staff Writer

EEDCO International (SCI) this week announced its acquisition of shares representing Sa 35 percent ownership in SeedCo Zimbabwe DEEPEST CONDOLENCES (SeedCo) as part of an ongoing merger of the two companies. Earlier this month, SCI made an offer to acquire all shares in SeedCo to complete the merger, which is meant to strengthen its listing on the Victoria Falls Stock Exchange (VFEX), and was approved by shareholders on December 31, 2020. “SCI has secured 35 percent of the issued shares in SeedCo in acceptances of its primary offer,” the two companies said this week in a joint statement. “The control block was secured… based on a share-swap of one SCI share for every 0,98 shares held in SeedCo,” read the statement. In accordance with Zimbabwe Stock Exchange (ZSE) rules, any entity that acquires a “control block” in a listed company is obliged to inform the public and has the option to make an offer for the remaining shareholding. “SCI hereby notiﬁ es the remaining shareholders in SeedCo of its intention to acquire their shares. The acquisition of the remaining shares shall be done Dr. S.B. Moyo Dr. E. Gwaradzimba through a secondary offer on the same terms as those by which the control block was secured,” the statement said. The Permanent Secretary of Transport and Infrastructural This secondary offer will close on March 2, 2021. SCI has said it plans to delist and achieve full consolidation of SeedCo on successful completion of the Development, Engineer T.K. Chinyanga, Management, and the acquisition transaction. SCI was unbundled out of SeedCo and separately entire staff of the Ministry join His Excellency, the President listed on the Botswana Stock Exchange (BSE) and the ZSE in October 2018. of Zimbabwe, Emmerson Mnangagwa and the entire nation in SeedCo, which is a Zimbabwean domiciled company, has been the second largest shareholder in SCI, mourning the passing on of the Minister of Foreign Affairs and with a 27,3 percent stake. According to the two companies, the current structure of SCI has certain peculiarities likely to disad- International Trade, Dr. Sibusiso Busi Moyo and Manicaland vantage its performance on a BSE-comparable, off- shore type stock exchange such as the VFEX. Minister of State for Provincial Affairs and Devolution, The peculiarities, which the companies say are a result of the makeup of the entire group, are that SCI Dr. Ellen Gwaradzimba. only comprises operations outside Zimbabwe, unlike Zimbabwean dual listed counterparts which are made up of both international and local operations. “Therefore, the board believes having only one of As the Ministry of Transport and Infrastructural the entities, SCI, on the VFEX trading in US$ while leaving the other, SeedCo on the ZSE trading in Z$ will not protect value for shareholders.” Development, we salute Dr. Moyo and Dr. Gwaradzimba for Further, SCI has also noted that the provisions and incentives offered by authorities in relation to their commitment to the socio-economic transformation of the VFEX, have been designed to make the market a platform for mobilising fresh hard currency capital Zimbabwe. for deployment mainly into Zimbabwean operations. “These unfavorable prospects are likely to curtail the attractiveness of SCI’s secondary listing on the MAY THEIR SOULS REST IN PEACE! VFEX with a negative effect on liquidity and price discovery to the detriment of existing Zimbabwean investors, who include pension funds and private individuals,” the group noted. newsdesk@ﬁ ngaz.co.zw The Financial Gazette January 28-February 03 2021 | Page 15 Column Financing Zimbabwe’s infrastructure needs (I)

Phillip Chitsika from five percent in 1980, to 43 percent in cent for Lesotho and 72 percent for Swaziland peak of US$50 million in 2014 before declin- 2009. (UNICEF, 2018). ing to US$19 million in 2016, depicting a de- Introduction The challenges in the water sector man- Public sector investments in water, sanita- clining trend. T IS estimated that between US$130 and US$170 bil- ifested in the outbreak of cholera that have tion and sygiene (WASH) was 0,13 percent of One major contributor to the Zimbabwe lion a year is required to close infrastructure gap in been reported every year since 2008/9, with GDP and 0,4 percent of the total budget below water sector is the ZIMFund that managed to IAfrica (Jesse and Madden, 2019). cumulative cases amounting to 100,806 and the international benchmarks (UNICEF, 2018). mobilise US$145,9 million by December 2018. However, the African Development Bank (AfDB) es- 4,360 deaths (United Nations Children Funds Despite the importance of donor support in the The programme was expected to end in Oc- timates a financing gap of between US$68 and US$108 (UNICEF), 2018). WASH sector, sustainability requires new inno- tober 2020. AfDB (2019) estimated that water billion per year (AfDB, 2018). By 2019, about 78 percent of the of the Zim- and sanitation sector requires about US$1,09 The gap has since doubled compared to the one in babwean households had access to improved billion is required in the next ten years. 2008 as infrastructure continue to deteriorate further due water source and most these were concentrated It is proposed that money should be raised to limited maintenance and upgrading budget. in urban areas. from donors, multilateral and bilateral institu- Infrastructure development is a necessary though However, most urban areas don’t have tions, private sector, local authorities and gov- not sufficient condition for the modernisation of econo- enough money for the purchase of water treat- ernment. mies and enabling them to participate in the global value ment chemicals due to non-revenue water and Going forward the water sector should con- chains. suboptimal tariffs. With on going water ra- sider blended finance. Moreover, infrastructure contributes directly to gross tioning in most urban areas the effective access Zimbabwe’s road network has a total length domestic product (GDP) growth in addition to being a to water and sanitation services by households vative ways of domestic resource mobilization of 101 483 kilometres, of which; 50 percent are catalyst for development. Without adequate, reliable, af- can be as low as 29,7 percent. which will help in sustaining the gains realized tertiary roads, 19,35 percent urban roads and fordable, and sustainable infrastructure the development Comparatively, Zimbabwe lags behind with through donor support. 13,59 percent are secondary roads. path will be a bumpy road. regards to access to safe water which was esti- Over the period 2009 to 2016 development ●Chitsika is development economist. He Zimbabwe needs to mobilise investment for the devel- mated at 20 percent compared to 96 percent for partners have contributed a total of US$251,34 writes in his personal capacity. opment and rehabilitation of both social and economic in- Botswana, 93 percent for South Africa, 82 per- million towards the WASH sector, reaching a (To be continued next week) frastructure; expand and adapt irrigation infrastructure to the needs of small holder sector and expand and upgrade power generation, transport and ICT infrastructure to support the needs of medium and longer term growth. This is indispensable if the country is to achieve Vision 2030 and its sustainable development goals (SDGs) targets. In 2012 the World Bank estimated that the country requires about US$33 billion in the next two decades (World Bank, 2012). If the economy was to pick up and demand for infrastructure increases a total of US$40 billion investment in infrastructure would be required (Lim and Pommerenke, 2012). It was estimated that US$14,2 billion at 2009 constant prices was required between 2011-2020 for infrastructure rehabilitation, upgrading and development (AfDB, 2009). Over the years investment in infrastructure has been barely minimum, mainly from government leaving a huge chasm in the infrastructure stock. Government managed to disburse a total of about US$3,6 billion towards infrastructure development from 2009 to 2019 against an estimated requirement US$16,5 billion over the period. The government budget commitment over the period averaged 1,99 percent of GDP against other countries’ allocation of above 7,5 percent for the likes of Botswana, South Africa and Lesotho. The AfDB report estimated that about US$ 33.78 billion is required for infrastructure development between 2019 and 2030 including funds for capacity building and technical support. The bulk of investments are required in the roads sector which requires about US$ 27,92 billion over the period, rail — US$ 399 million, electric power — US$1,14 billion, water and sanitation US$3,67 billion, civil avia- tion US$ 238 million and communication US$412 million. Private sector is expected to contribute about US$7,91 billion while the national budget will contribute US$10,94 billion, state enterprises — US$11,19 billion, local authorities — US$51 million and donors — US$3,69 billion. Government has to improve the investment climate and stabilise the macroeconomic environment to attract investors in infrastructure financing. Players in the infrastructure sectors advocate for cost reflective tariffs to improve banakability of infrastructure projects. Zimbabwe’s infrastructure needs Since independence the country had managed to put decent infrastructure in all sectors which was quite comparable to other SSA countries (Briceno-Gamendia and Pushak, 2011). However, the basic infrastructure has suffered from lack of maintenance and rehabilitation since the economic decline set in the late 1990s. At independence in 1980, Zimbabwe embarked on the development of water supply and sanitation infrastructure, leading to very high levels of coverage by the late 1990’s (World Bank, 2008). It became a regional leader in innovation, and pro- gressive policy and strategy reform throughout the period. The gains hitherto realised in the water and sanitation sector since independence were reversed due to the paucity of new investments, coupled with inadequate revenues for operation and maintenance. Zimbabwe’s experience of water and sanitation sector lays bare the need for sustainable funding beyond state subsidies and donors (AMCOW, 2010). In Zimbabwe there are various estimates with regards to access to clean water, the optimistic scenario uses the lower targets and is based on WHO/ UNICEF Joint Mon- itoring Programme (JMP) figures. In 2008, JMP suggests that 82 percent of Zimbabwe- ans had access to safe water and 68 percent to an improved toilet. The water policy (2013) highlighted that the coverage of rural sanitation and hygiene improvements moved Page 16 | January 28-February 3 2021 The Financial Gazette Column Statutory rate for Z$ employer loans goes up NDER the current difficult eco- any of their relatives, is given a cheap or payrolls to effect this change to ensure they remain nomic environment, employers interest-free loan. tax compliant. U may wish to cushion their employ- The law has stipulated this advantage They may opt to revise loan agreements to en- ees by giving them loans where financial as the difference between interest at the sure the interest charged to employees matches the institutions are hesitant to do so because appropriate "official rate" (currently Libor new rate if they wish to have their employees ex- of the high default rate. + 5 percent) and the interest, if any, actu- empt on the benefit. A further advantage of employer pro- ally paid by the employee. The increase in the rate will result in additional vided loans is that they are cheaper than Such loans are called beneficial loans. income to the employer and an outflow to the em- the traditional bank loans. Libor stands for London Interbank Rate. ployee. Employer loans are also valuable to This rate applied equally to both the If the rate is not changed, the employer must some employees who may not qualify US$ and Zim$ denominated loans prior to account for tax on their benefit i.e. the difference for these traditional loans, making them January 1, 2021. between 15 percent and the lower interest rate paid a source of help when no other avenue is However, this has been revised through by the employee. available. Tax Matters Finance Act 2 of 2020 effective this date Both options impose financial burden on the em- Employees also like this benefit be- with in so far as the Zim$-denominated loans ployee but leaving the rate as it is may be cheaper, cause payments can be made through au- Marvellous Tapera is concerned. compared to adjusting it to the new official rate. tomatic payroll deductions, making them Therefore, effective this year, the offi- New loans, however, should be established at the simple and administration-efficient com- law, a tax charge will arise where a di- cial rate for the Zim$ loan has been in- new rate, if the policy is to afford employees tax pared to loans accessed through banks. rector or employee obtains a benefit by creased to 15 percent. fee loans. According to the strict letter of the reason of their employment when they, or Employers are advised to adjust their The interest rate for the US$ loans remain fixed at Libor plus 5 percent. Meanwhile, the threshold for Zim$ tax free loans has also been revised to ZWL$8 000 and the US$100 for US$-denominated loans remains the same. A pertinent issue that may arise is what determines whether the loan is in US$ or the local unit. This may particular arise in a situation where the employer advanced the loan to the employee in US$ but the employee makes the payment in ZWL$ or vice versa. This is a very likely scenario considering that a great number of businesses who receive their Therefore, revenue in both currencies may remunerate effective this their staff in one curren- year, the cy or a combination of official rate both. In our view, a foreign for the Zim$ currency loan means loan has been that you borrow in foreign currency and repay increased to in the same currency. 15 percent. What therefore determines the currency of the loan is the ultimate currency, which is used by the borrower to repay the loan. Thus, if an employee was advanced a loan by the employer in foreign currency and uses his/her Zimbabwe dollar remuneration to repay the loan, this may be deemed a Zim$ loan. This would be imperative in determining the prescribed interest rate to be used hence in the calcula- tion of the benefit We, however, implore employers to consult their legal experts on this matter. In conclusion, employers must always ensure that when they give an employee anything that saves him/her from taking out of his/her pocket, they must include this in the payroll as this consti- tutes a benefit in terms of the law. This may be for the benefit of the employee, his/ her spouse or child. Without limiting to the generality, an advantage or benefit can take a form of a board, occupation of quarters or residence, or the use of furniture or motor vehicle. It also includes the use of or enjoyment of any other property whatsoever, corporeal or incorpore- al, including a loan, an allowance, passage benefit and any other advantage or benefit whatsoever in lieu of remuneration. Most of these benefits are valued at cost to employer except those whose value is prescribed in terms of the law such as the motoring benefit, interest free or subsidised employer loans etc. The case of six private schools vs. the CG of Zimra (HH314-16) held that the term cost to the employer includes both the variable and fixed cost incurred by the employer to ensure the provision of the benefit to the employee. Lastly, the omission of benefits or miscalcula- tion may prejudice the revenue authority and may have serious ramifications on companies’ standing with the taxman. ● Tapera is the Founder of Tax Matrix (Pvt) Ltd and the chief executive of Matrix Tax School. He writes in his personal capacity. Matrix Tax School (Pvt) Limited hosts a webinar short course in Managing Tax Practice (Basic Theory & Practice) every Wednesday and Saturday. The Financial Gazette January 28-February 3 2021 | Page 17 Column Business and its role in society

NE great discussion topic and area of study has For example, companies like Delta Corpora- to do with defining exactly what a business is and tion and BAT Zimbabwe are affected by tax pol- Owhat its obligations are to society at large and to icies and regulations related to the marketing and the many stakeholders (customers, shareholders, employ- distribution of products, particularly in a Covid-19 ees, suppliers and policy makers) participating in the busi- environment. There is indeed a strategic logic in ness environment. maintaining a good relationship with the govern- For most businesses, the focus has been first and fore- ment. most on serving the customer. For others, the focus is on This, however, calls for a shift to long-term the shareholder. strategic thinking among business leaders. More recently, we have seen a broadening of the dis- As Morgan & Co Research, we have consis- cussion to recognise the importance of multiple stake- tently insisted investors on our market to gain ex- holders and the need to promote social, environmental posure in companies with solid business models and financial value. and proven management teams. In 1970, Milton Friedman argued that the only social Based on our assessments of the leadership, we responsibility of business was to maximise profits. Lev- remain long-term bulls on Delta, Old Mutual Zim- itt (1958) captured this perspective succinctly when he babwe Limited and NMBZ Holdings. wrote, “the business of business is profits.” ● Matsika is head of research at Morgan & However, in the real world, there is a lot of failure in Co, and founder of piggybankadvisor.com. He the delivery of public goods, schools, infrastructure and can be reached on +263 78 358 4745 or bata- healthcare. [email protected] / batanai@piggybankad- As a result, corporations are being required to partici- A comparison of case fatality rates. visor.com pate in broader societal advancement not only by regula- Source: Bloomberg tors but by investors and other stakeholders — employees, customers, communities. Most business leaders must navigate this line, making sure companies remain profitable enough to fund R&D, innovation and future proofing — while making the world a better place. A practical example has been the outbreak and spread of the Covid-19 pandemic. Globally, it has turned into a race between injections and infections as governments focus on vaccination programmes. Recent data from Bloomberg indicates that there are a total of 99 718 399 confirmed cases and 2 139 929 deaths worldwide.

Economics & Market Intelligence with BATANAI MATSIKA

In Zimbabwe, the government is ramping up preparations to roll out Covid-19 vaccines. Indications are that cabinet ministers, legislators and frontline health workers will be prioritised and get the first doses. Meanwhile, there are plans to engage business people in a bid to mobilise resources to acquire more vaccines to cover the entire country. The important question is whether there is any value for businesses in Zimbabwe to fund or support the vaccination programmes? While the business of business is indeed business, it appears that there are compelling reasons companies should seize the initiative to drive social and business benefits. In an interconnected world facing unprecedented environmental and social constraints, society will demand it. Increasingly, a basic expectation among customers, governments, and communities will be that the companies they do business with provide a significant net positive return for society at large, not just for investors. But can firms do well by doing good? There are numerous research papers that try to estimate the effect of corporate social responsibility (CSR) on financial performance. However, the results are mixed. The more recent work of Nyborg and Zhang (2013) shows that firms with a strong reputation for social responsibility pay 38 percent less than firms with a weak reputation for CSR. Hong and Kacperczyk (2009) contend that companies involved in the production of alcohol, tobacco and gam- ing have higher expected returns than otherwise comparable stocks, suggesting that investors pay a financial price for a higher social return. A meta-study by Margolis et al. (2007) covering 167 papers concludes that corporate social responsibility has a small, positive effect on financial performance. Overall, while CSR initiatives do not immediately affect a firm's profitability through higher product revenues or lower costs, there are other reasons why it might increase value. CSR can be a strategic asset that firms use to build a reputation with key stakeholders. Firms invest in CSR to purchase a form of insurance against negative firm events. The idea is that by engaging in CSR, firms create a reputation for behaving in line with other actors and this creates “moral capital" that the firm can draw upon in times of adversity. Page 18 | January 28-February 3 2021 The Financial Gazette Column How many people should report to the CEO? n organisational design, the first organisations you are benchmarking encourage you to have as many direct reports as structure every organisation must with. It is therefore, not advisable to the business requires. I put in place is the top structure. depend entirely on benchmarking when Your Exco is the executive decision-making This structure has the chief executive putting together your organisational board and not the CEO on their own. Other officer (CEO) and all the people who structures. factors to consider when reviewing your top report to them. The ideal number of direct reports to structures are the nature of work to be done by I know a lot of people have different the Managing Director is 8 to 12. direct reports, the complexity of that work and views regarding the above question In Zimbabwe from a survey, we did the risk of poor supervision. but there are certain basics we must in 2017 the average number of direct Which portfolios should report to the CEO understand as we put out structures reports to the CEO excluding the PA is 5. again is a function of the nature of the business together. The number is considered sub- being undertaken. I have heard the argument that the HR Perspective optimum for big organisations but Before we look at trends in terms of which CEO does not need a lot of people with optimum for small organisations. It is portfolios report to the CEO, let me dispel the reporting to them because it distracts Memory Nguwi reported for example that Tim Cook the myths that position reporting to the CEO must them from focusing on the big picture. CEO of Apple has 17 direct reports. be directors or at the same level or grade. That That is old fashioned and is not As you can see the number entirely notion is not correct. supported by both trends and facts on There is nothing wrong with this depends on the strategy of the business Portfolios and positions reporting to the CEO the ground. approach but you must remember that and to a large extent the size of the must be based on the strategy of your business Most organisations have resorted to structure follows strategy. organisation. and how those portfolios will assist your business benchmarking as they put their structures As you benchmark, remember If you are running your business to achieve its desired goals. together. your strategy is different from the properly and utilising your Exco, I would There are notable portfolios that some organisations have deliberately removed from the top structure in the name of going lean. The portfolios include Human Resources and ICT. It is a tragedy for the business and for The Financial Gazette @FingazLive any CEO to run a business without first-hand information on what is happening in these two areas. Look at any successful business in any modern economy; they are all driven by human resources and ICT. Above all, the CEO does not need to be an expert in any of the areas reporting into this role. The incumbents reporting to the CEO are the ones who must give expert advice to the CEO. Develop financially Other factors to consider as you look at your structures are Span of Control - Refers to the total number of people (here, subordinates or literate business leaders employees working under) whom a manager or an administrator can effectively control and supervise. The average span of control is measured using a ratio of the number of managerial nodes and the total population. Reporting Layers – This is the hierarchical arrangement of lines of authority, communications, rights and duties of an organisation. Organisational structure determines how the roles, power and responsibilities are assigned, controlled, and coordinated, and how information flows between the different levels of management. It is useful to test managerial structures against an "ideal" benchmark. We usually set this at a maximum span of eight, with an ‘ideal’ of not more than five layers – usually referred to as the ‘8 x 5 test’. Again this depends on the size and nature of business being managed. Please note that as outlined at the beginning, the number of direct reports to the CEO is increasing. Another notable trend in this area is that the role of the chief operating officer is disappearing as it is of very little value if there is a capable CEO. Manager to non-management ratio – This is a key performance indicator that shows the ratio between the total number of managers and supervisory employees and the total number of full-time and half-time non–managerial (non- supervisory) employees. Subscribe for your former One on One Reporting - One on one reporting is an effective barrier to proper oversight, & your child’s school communication and flow of information up and down the chain of command. It may block the main boss’ vision of the work being done or not Contact our subscriptions team on: being done All the above information taken together [email protected] must be able to guide the structuring of any organisational structure. The ultimate test of any structure is how well it is supporting the business in achieving its Subscribe Now desired goals. n Nguwi is an occupational psychologist, data scientist, speaker, & managing consultant at Industrial Psychology Consultants (Pvt) Ltd — a management and human resources consulting firm. Email:mnguwi@ ipcconsultants.com or visit our websites https://www.thehumancapitalhub.com/ and www.ipcconsultants.com The Financial Gazette January 28-February 3 2021 | Page 19 Column Disruptive Innovation: A force to reckon with hAnKs to the Covid-19 global crisis, firms have Uber used a simplified business model to dis- Take home points Make use of video conferencing tools to host been pushed to the precipice where there is only one rupt the taxi industry. From time to time, it takes a devastating event workshops, conferences, virtual boot camps etc. Tmantra: Innovate or Die! This then presents a dilem- The founders were able to create a service no to force change and modernisation as we have Think how your company can offer its services ma of unprecedented proportions. one knew they needed. Zimbabwe’s very own witnessed in the healthcare industry due to the ef- virtually via videos, eBooks, product guides or the If companies have been decimated by this crisis leaving Ecocash mobile money platform by Econet Wire- fects of the Covid-19 pandemic. creation of interactive websites. them incapacitated, how then can they innovate? Are they less, is also a disruptor in the banking sector and Both patients and healthcare providers have Rent pop-up offices for as long as you need then not just left with one option: to die? The prospects and it has moved in leaps and been forced to make them. Virtual office spaces are great for business- opportunities to make a transformation through thinking and bounds in a very short space use of telemedicine, es that obviously no longer require big corporate acting differently are existent, but only for the ingenious rap- of time. where they are forced offices. id thinkers and actors. Many African schools into live-video visits that Consulting firm McKinsey, say in their recent An innovation is a generation, admission and realisation and colleges, especially here have been surprisingly article Ready, set, go: Reinventing the organisa- of new things such as processes, ideas, products and services. in Zimbabwe have been us- effective. In your busi- tion for speed in the post Covid-19 era, compa- Innovation must include original invention and ingenious ing various online learning Rujeko Adlyne Bara ness, inclining into these nies must rapidly make decisions, continuously use. There are many different types of innovations found in platforms to ensure that stu- inevitable changes can be improve productivity and obviously use data and today’s world including service, incremental, sustainable, dents complete their curric- an effective way to stay technology in new ways so as to accelerate the supply and disruptive innovations. ulars and courses during this profitable. scope and scale of innovation. It seems sustainable innovation, also called Routine In- lockdown period. Communication and collaboration tools like n Bara is the sales and marketing manager novation, is what most companies, especially the very large These online platforms, like Zoom are dis- Zoom and Facebook are an integral part of the of Avant-Garde Steel and is a freelance writer. organisations, have been relying on for years. This kind of ruptive technologies. This indeed shows that this communication process especially during this She is a member of the Marketers Association innovation occurs on an incremental basis. This is usually wave of disruption has indeed covered the whole Covid-19 era where most people are working re- of Zimbabwe. a result of improvements in technology or as a response to globe. motely. market and consumer demands. Famous examples of sustainable innovations include integrated steel mills, main frames and mini computers, fixed line telephony, four-year colleges, full service department stores and doctors’ offices. The ever-present threat is that these businesses tend to innovate faster than their customer’s needs, thus ending up producing products that are eventually too sophisticated, expensive and complicated to many customers, potentially leading to their demise. In recent history, global trends have been pointing to a new innovation champion, more so now than ever before, because the pandemic has upended every aspect of our lives leading to a major economic shock. Businesses have closed, some are scaling down their operations, business activities have slowed down and some companies are seeing lower revenues. These harsh times have undoubtedly nurtured disruptive innovations. Forbes Business defines disruptive innovation as an innovation that aids in the creation of a new market, value system and ultimately goes on to disrupt an existing market system, dislodging an earlier technology. In this perspective, the term "disruptive" does not mean to cause disorder or to interrupt — it means to replace or to disrupt the status quo. At present, the term "disruption" validates any and every innovation coming out of the technology sector. The term disruptive innovation was popularised by professor Clay Christensen in his iconic book, The Innovator’s Dilemma. Potential disruptors begin by effectively targeting those ignored segments thereby acquiring a foothold by providing more suitable functionality at a lower price. These firms find a means to transform complicated and expensive products into simpler and more affordable ones, which appeal to consumers who hitherto lacked the money, and the expertise to own and use the incumbent’s products. Incumbents chasing higher profitability in more arduous segments tend not to re- spond robustly. This gives the entrants the chance to move upmarket, delivering the performance that incumbents’ mainstream customers require, while protecting the gains that drove their early success. When mainstream customers start adopting the entrants’ offerings in volume, disruption has occurred and it will be too late for the incumbents. A modern disruptive innovation example is the Internet. It meaningfully transformed the way companies do business and at the same time adversely impacted companies that were unwilling to adapt to it. Iconic examples of disruptive innovations include steel mini mills, video streaming, online encyclopaedia and references, smartphones, radios, personal computers, retail medical clinics and photography. Recent disruptive technology examples include online news sites and GPs systems and e-commerce. YouTube is a disruptive medium but what is more fas- cinating is that it has become a stage upon which other disruptions are launched. Zoom, with over 300 million active participants daily on their platform, has emerged as a story of huge disruptive innovation across the whole world. netflix is a disruptor that has changed how customers watch movies and TV shows. Amazon is a disruption marvel. It is seen as one of the world’s most disruptive companies, because people love it so much that they forget they are paying for the services. Dis- ruptive technologies include social media platforms, robotics and Big Data. not every new technology or innovation will alter the business landscape but some truly do have the potential to disrupt the status quo. Africa has neither been forgotten nor left behind. M-Pe- sa and Uber are riding the wave of disruption. M-Pesa is a mobile money transfer system operated by Kenya's largest cellular phone provider, safaricom. This simple and effective mobile payment service's strength lies in its simplicity and customer centrism, using affordable basic mobile phones rather and an extensive network of franchised M-Pesa agents where anyone can transfer money simply by texting. Page 20 | January 28-February 3 2021 The Financial Gazette Column Private arbitration as an alternative to formal courts itigation through the formal an agreement that is contrary to public poli- tractual or not, shall be submitted to arbitration. Such courts may at times be a tedious, cy is incapable of being arbitrated upon. an agreement may be in the form of an arbitration Ltime consuming process that may an example of such an agreement is clause in a contract or in the form of a separate agree- leave one’s pocket seriously eroded, par- where people agree to run a brothel and then ment. ticularly in instances where the court cases one of the parties attempts to sue for viola- this agreement must comply with certain formal- may drag on for years. tion of such an agreement. Certain disputes ities required in a contract and one such formality to avoid the hustles associated with for- are specifically prohibited by law from be- pertains to signature of the parties. the act provides mal courts, the law gives leeway to individ- ing arbitrated upon. that, an exchange of letters, telex, telegrams or other uals to litigate via private arbitration. the a criminal case is also exempted from means of telecommunication like emails, may pro- advantage of this process is that, it is swift. the process of arbitration. Similarly, a mat- vide a record of the agreement. However, the costs associated with pri- rimonial matter, as well as a matter affect- the parties are free to determine the number of vate arbitration may be much more than ing the interests of a minor, may not be arbi- arbitrators and in the event of disagreement, the max- those that one may have to pay when using Legal Matters trated upon unless the High Court has given imum number shall be three (3). if the parties are pre- formal courts. with specific leave for any issues arising to be dominantly domiciled in Zimbabwe, and in the event Whereas a judicial officer in the formal VOTE MUZA determined by arbitration. of a failure to determine the number of arbitrators, courts is not expected to be paid by the lit- arbitration can only arise through the then such arbitrators shall be limited to being one. igants directly, in an arbitration, the parties act”) governs all arbitrations. it is not ev- agreement of the parties. the agreement When settling for an arbitrator, it matters not that may have to jointly meet the arbitrator’s ery dispute that crops up between individu- must stipulate that certain disputes or a dis- the intended arbitrator is a foreigner. the arbitration fee. als that may end up being the subject of an pute which arises or may arise in respect of agreement must provide for a procedure of appoint- the arbitration act [Chapter 7:15] (“the arbitration process. a dispute arising from a defined legal relationship whether con- ing the arbitrator or arbitrators and in the event of disagreement, the parties may approach the High Court. it must be noted however, that such an unreason- able disagreement at such an early stage of the process tends to defeat or undermine the very purpose for which the arbitration may be intended and this is; an expedient, swift, settlement of the parties’ dispute. Whereas in the High Court, the parties are limited to procedures outlined in the court rules, in an arbitration, the parties are free to agree on the procedure to be followed when conducting the proceedings. in the event of a disagreement, the arbitral tribunal may subject to the provisions of the model law, conduct the arbitration in such manner as it considers appropriate. For purposes of enforcement, an arbitral award must be registered with the High Court. This entails filing a court application, attaching the arbitral award so that the award may be made an order of the High Court.

the parties are also free to agree on the place of arbitration and where parties fail to agree, the tribunal guided by the circumstances of the case, including the convenience of the parties, shall determine the venue. Language use is flexible and the parties are free to agree on the language or languages to be used. Parties also have a choice on whether to hold an oral hearing for the presentation of evidence or whether the proceedings shall be conducted on the basis of documents and other materials. an expert may be appointed by the tribunal to assist on any area that may require expert opinion. in proceedings with more than one arbitrator, for the decision to be valid and binding, it must be by majority of all its members. the award shall be in writing and shall be signed by the arbitrator or arbitrators. the process of arbitration shall be terminated by the granting of an award or where a claimant with- draws his claim. there are certain remedies available to the parties seeking to challenge the arbitral award. an offend- ed party may apply to the High Court for the setting aside of the arbitral award. in making such an application, the party seeking to challenge the arbitral award must establish any of the requirements provided under article 34 Rule 2. an illustration of such requirements that can jus- tify the setting aside of an award is that the subject matter was incapable of settlement by arbitration under the law of Zimbabwe or that the award is in con- flict with the public policy of Zimbabwe. For purposes of enforcement, an arbitral award must be registered with the High Court. this entails filing a court application, attaching the arbitral award so that the award may be made an order of the High Court. only through this process, can a successful party be able to instruct the Sheriff in order to get the rem- edy that he or she craves. n Muza is a Harare-based legal practitioner. He writes in his personal capacity. The Financial Gazette January 28-February 3 2021 | Page 21 Column Tips on avoiding the Founder’s trap either lacking or just patched together, mirror and pledge that they want to which leaves them in a place of chaos move past the trap. and overwhelm. i)Delegate: Against your will, start "They are trying to hold it all together with simple things such as approving at the expense of their time, their energy time sheets and in many cases their family.” ii)Develop a leadership team, either The trap is compounded by the wholly internal or with an outsourced concept of the entrepreneur myth that component such as a consultant. Involve businesses are formed by people who them in the decision-making process to are good at something or have a specifi c lighten your load. skill or interest and proceed to build a iii)Train the leadership team and Executives Only Corner business around it. implement an organisation structure with These “technicians” do not know which supports it. Identify the diffi cult Shepherd Shonhiwa how to run a business thus, chances aspect of the business that only you VERY business existing today of failure are high. To succeed they understand and compile a training was founded by one or more need to have three unique eyes of an programme for the team Epeople sometime ago. The thrust entrepreneur, namely; iv)Force yourself to take leave, of commercial activity is that businesses �Visionary eye: To be consistently starting with short periods to test the are established every day, mostly as looking forward for opportunities. To waters. Initially, put into place a fail- small start-ups. be the big ideas person, the dreamer and safe mechanism that prevents disastrous It takes a brave, hard-working innovator. results from bad decisions in your individual with a viable idea to start a This forward-thinking is critical for Developing a leadership team is key and it should be involved in the decision- absence business. entrepreneurial effort to succeed making process to lighten your load. The Founder’s trap is as common After fi nding the capital to start, they �The manager eye: This is the focus as business establishments so persevere with their business to realise on the here and now of the business the entrepreneur to understand the Each stage demands different entrepreneurs must learn to manage it success. to measure whether it is operating concept of the Sigmoid Curve or the management approaches, staffi ng effectively. When all is seemingly going well, successfully or not. They live in the business life-cycle. needs, capitalisation patterns and The above tips are not exhaustive you hire staff as business is growing, past and present, with preference for Every business owner must peculiar skill-set. and they impact people differently. that’s when the speed-hump of the consistency avoiding change and confi dently know whether they are still Failure to adapt accordingly confi rms However, generic solutions Founder’s trap or Entrepreneur’s trap creativity. at start-up stage; or they have weathered the trap and its negative results. include not being fi xated on the past hits you. �The technician eye: This is the the storm to the growth stage; or they To avoid the Founder’s trap or which prevents one from letting go of Tina Forsyth, an expert in the skill or idea that led the entrepreneur to are now at the maturity stage and lastly, mitigate its impact, the entrepreneur detrimental business aspects. fi eld observed the symptoms as: “... start the business in the fi rst place. if they are in the decline stage heading must undergo a mindset sea change to Maintaining healthy work-life entrepreneurs working way too hard. This is the “doer” who lives in the for sunset. inculcate the ability to “resist the urge balance is the best gift an entrepreneur "Working evenings and weekends, present trying to do everything but Ideally, one would like to get into to be involved in every aspect of their can give themselves in the long term. never taking time off or a real vacation. eventually gets overwhelmed by the growth phase quickly and prolong business, that no one knows it like they  Shonhiwa is a chartered director Their operations, systems and teams business demands. it as mush as possible to maximise do”. and has authored books on leadership. — all essential for their growth — are Fundamental to the solution is for profi tability. Therefore, they must look in the He writes in his personal capacity.

For the week ending 27 January 2021

For the week ending 06 January 2020 Page 22 | January 28-February 03 2021 The Financial Gazette Motoring Volkswagen T-Roc Has Wolfsburg really put

TOP GEAR with Richard Wiley style before practicality? AVING missed out on the me- 500 rpm, that’s of no consequence as dia launch of the T-Roc back the brilliant 7-speed DSG gearbox has Hin November, I was very keen enough ratios on offer to keep the en- to get my hands on an example to fi nd gine in its sweet spot. out just how Volkswagen’s surprisingly Gearshifts are ultra-rapid and al- compact SUV interpretation fi ts into most undetectable other than by watch- the brand’s ‘crossover’ line-up. ing the rev counter, but for those who Even if the ‘Roc’ is new to Mzansi, seek greater control, paddle shifters it’s far from new in other far-fl ung plac- are neatly integrated behind the leath- es as the model fi rst saw the light of day er-wrapped steering wheel complete more than three years ago. with numerous controls for Bluetooth, Just why there has been such a long cruise control and the digital displays. wait for the southern regions of the Af- For those in a hurry, real world tests rican continent is something for VWSA suggest that 100 km/h can be breached to answer, but of greater importance is in under 7 seconds – that’s a class-lead- the fact that the time schedule I have ing fi gure – and with the benefi t of enunciated upon means the T-Roc is 4Motion, traction is always assured on based on the Golf 7 platform and not almost any surface. that of the Golf 8 as some might have Top end is around the 216 km/h expected. mark while overall fuel consump- In my book, that’s no bad thing as tion came out at a very, very pleasing I rate the Golf 7 as the very best of all 8.3l/100km, a fi gure that confi rms how the derivatives of Wolfsburg’s one- easily the engine can deliver the goods time global best-seller and fl ag bearer without having its neck wrung. for VW since the mid-1970s. Yes, the R-Line T-Roc looks especially smart with duo-tone paint job. To me, it seems marginally incon- appeal of the hatchback concept, very gruous that an AWD crossover should sadly, is being eroded such that the be fi tted with 235/50R19 rubber, but Tiguan is now Wolfsburg’s global best the sport orientated suspension offers seller. of a Driver Profi le Selection which in- And now the T-Roc, which fi ts be- cludes ECO, Sport, Comfort and Off- tween the aforementioned Tiguan and road modes together with an AWD sys- the ‘entry level’ T-Cross, will make life tem that covers Auto, Snow, Off-road even harder for the Golf, unless interior and Individual settings. space is an important attribute of any The result is a dynamic level of per- vehicle you may purchase. formance that has a feel much akin to In the last year or so, I have made that of a GTI. a number of attempts to persuade my Grip, control and comfort make for UK-based son to gravitate towards a a great all-round driving experience T-Roc as it just looks so right, but he’s that sits more on the side of control always responded with the rider that than outright comfort, regardless of the T-Roc is too small – “it will never chosen mode, while roll in corners is accommodate us and all our camping very well contained. At low speeds, gear for Le Mans” he has insisted. the power steering is decently direct Little did I realise how right he and easy to twirl while greater speed is was as my tenure of the range-topping Seating is smartly trimmed but rear space is only Digital instrument displays and duo-tone seating are accompanied by more effort. 2.0TSI 4Motion R-Line model with average. standout features. Wind noise is very well restrained 7-speed DSG transmission has proved. million Rands. Nor for that matter is fl ush mounting of the touchscreen in- tional and conservative territory, VW as is road roar on smooth surfaces, but Rear space is seriously limited such that the use of a cheap metal rod to prop up fotainment/nav unit and integration of offers the Roc in a host of attractive coarser tar chippings do cause more there is no way half a Springbok pack the bonnet when a gas strut could be ambient lighting, add a touch of glitz paint shades and a good selection of commotion than might be anticipated could be accommodated in this cabin expected. This ‘cheap’ solution seems which the younger set is sure to appre- duo-tone offerings. The test unit sport- largely because the relatively stiff- without the two in the front compro- all the more incongruous when the ciate. ed a most attractive and beautifully walled tyres transmit noise through the mising fore/aft space to such an extent tailgate is provided with an auto open/ For me, the clincher comes in the applied Silver White metallic offset unibody structure into the relatively they would think they were in a scrum. close facility and keyless access/start is shape of wireless integration of Apple by a gloss black roof that blended re- large cabin area. So be aware that even regular-sized provided too. CarPlay and Android Auto, both of ally well with the thoroughly attractive As for braking performance, the adults simply will not have kneeroom If you think I’m being harsh, take a which provided fl awless functionality. 19-inch black and diamond cut alloy all-disc set-up provides massive power to spare unless the driver and front pas- look at a Polo’s upper dashboard. It’s However, be aware that this connec- wheels. reserves and decent pedal feel, albeit senger compromise. This is not some- a tactile feast by comparison, but most tivity is provided as part of the op- But this exterior offers more than that boost at low speeds is perhaps a thing you’d expect from an ostensibly importantly, these are not shortcomings tional Discover Media with Discover just eye candy as the overall levels of tad aggressive. practical crossover and neither is the a buyer would expect from a premium Pro (nav) system. Standard fi tments assembly, and most especially the uni- There’s no doubting that the com- luggage space with all seats in use. priced Volkswagen. include all the usual niceties such as formity and tightness of panel gaps, pleteness of the driving performance The AWD system needs extra verti- Having exposed my inner feelings auto air con, electrically powered ev- proved to be nothing less than out- accessible across all usage conditions cal space which leaves a very shallow about these uncharacteristic shortcuts, erything, posh lighting which includes standing by comparison with cars even is something to be applauded, at least luggage area boasting a volume of just let me state here and now that the fi t daytime running lights that morph into in the most lofty price ranges. Hats off with 2.0 Turbo power and AWS, but 392 litres. However, the rear seats can and neat integration of all the bits that indicators on demand and much more. to the line workers and robots at what I others who have driven the 1.4 TSI be folded 60:40 to leave a much more make up this modern interior leaves lit- Other options on this specifi c vehi- believe is VW’s plant in Portugal. reckon little is given away by this will- useful 1237 litres. tle to be desired. It’s the materials that cle included a Panoramic Sunroof, Park For specifi c details of this range-top- ing powertrain and that as far as value Staying on the inside, I have to re- have extracted my cynicism. Assist with a rear view camera, and ping model as well as info on the 2.0 for money goes, the smaller-engined cord another disappointment and that Happily, the seats, in this top ver- what is termed IQ Drive Big Package ‘Design’ and 1.4 TSI T-Roc derivatives, version represents a sweet spot.. concerns the tactility of some of the fi t- sion at least, are swathed in really good which incorporates Blind Spot Monitor could I direct you to www.vw.co.za In Hopefully I’ll be able to deliver my tings as there’s a paucity of soft-touch quality, neatly stitched hide. I also ap- Plus with Rear Traffi c Alert and Lane the meantime, I will tell you that this own verdict on the subject, but for now surfacing in this T-Roc cabin. The plaud the use, at last, of a shade other Keeping System. As you’d expect from R-Line model hides VW’s ubiquitous allow me to applaud this top model 2.0 upper dash - not to mention all four than anthracite. Medium grey primary VW though, a full array of air bags is 2.0 turbo four under its shapely bonnet. TSI for its very pleasing drivability, its door cappings - is decked out in hard, panels are off-set by smart, parchment on board as standard along with ISO- This derivative provides an effortless exceptionally executed external presen- grained plastic endowed with a mild colour inlays that swathe the bolsters, FIX attachments and an endless array 140kW power peak allied to a meaty tation and its feature-laden specifi ca- sheen that’s distracting in certain light front and rear. Those seats are well of alternative electronic braking protec- 320Nm torque output that collectively tion which can be further supplemented and which acts as a hollow sounding padded and shaped for good support tion systems. ensure easily accessible and rapid pro- by a number of pricey options. Howev- board when tapped. Ringo Starr would and do much to lift the ambience that’s I’ve already alluded to the fact that pulsion. er, given its rather compact dimensions, have a fi eld day with his drumsticks. been sullied by those omni-present by common consensus, this T-Roc is a As ever with a turbocharged VW, the T-Roc R-Line is perceived as bor- Those same doors sport scanti- hard plastics. good looker. Sure, the R-Line trim adds all the goodness can be extracted at dering on being overpriced. ly-padded armrests and equally thin And equally happy to report, the lat- a lot of pizzaz to the overall package, relatively low revs with minimal lag to With the options on-board this car, ‘elbow inlays’ within which rather est digital dash presentation from VW but the good news is that the glitz is sully early momentum. the price tag hovers around the R650 cheap looking door pulls are attached. really is slick. Not only are the graphics backed up by truly exceptional external Aurally, the motor can sound just a 000 mark, a fi gure that draws into sharp Not what is expected in a vehicle which as clear as crystal, this car’s 10.3-inch fi nishing detail. touch gruff but never intrusively so, and focus just how indifferent some of the in this spec commands two thirds of a Active Info Display, along with the In another move away from tradi- while it runs out of energy at around 5 interior fi tments are. The Financial Gazette January 28-February 03 2021 | Page 23 Page 24 | January 28-February 03 2021 The Financial Gazette News Parliament to debate cryptocurrency

Omega Ukama ment. We have formed the national Fintech group at the Companies Editor RBZ to look at digital currencies and we have sent a circular to bankers about the sandboxes, asking for their proposals. UNITED Kingdom-based Zimbabwean lawyer is We are not against innovation,” RBZ governor John Man- hoping to push a blockchain technology and digital gudya said at the 2020 Institute of Bankers of Zimbabwe assets business bill through parliament during the summer school in November. A “But currently, like any other country in Africa and the fi rst quarter of 2021. Zimbabwe currently does not have legislation covering world over, your cryptocurrencies or your bitcoins, they are digital assets but Prosper Mwedzi is hoping to change that not allowed in this country,” he added. by introducing the private bill to parliament. In 2018, the central bank blocked bank accounts of a “If the bill passes into law… it will enable anyone who local cryptocurrency exchange, Golix, which at the time wants to apply to run a crypto-business such as an exchange claimed it had as many as 50 000 active users. or issue tokens to register with the regulator and get a li- The exchange also had an ATM that converted Bitcoin cence to operate,” Mwedzi announced on Twitter this week. to US$ cash. The central bank then said the move to block “I will share more details in the coming days, but it is im- Golix was meant “to protect the public and safeguard the portant that MPs know and understand that this technology rency to promote tourism in the country — tions and disciplinary matters. integrity and safety of the country’s fi nancial system”. is now used in the banking sector in other jurisdictions like Vic Falls Coin. The central bank has, however, said it in- Meanwhile, the demise of Golix has not deterred lo- the US and it can improve access to fi nancial services for A draft of the bill seen by The Financial tends to introduce its own regulatory frame- cals from trading in cryptocurrencies with an underground Zimbabweans,” Mwedzi said. Gazette this week covers areas such as li- work for digital assets. market having emerged on social media platforms such as Mwedzi is also behind efforts to introduce a cryptocur- cencing, administrative authority, investiga- “We are not against fi nancial develop- WhatsApp and Facebook. newsdesk@fi ngaz.co.zw South Africa cracks down on Bitcoin OUTH Africa’s fi nance-industry regulator wants more power to prosecute perpetrators of fraud and Soversee dealing in cryptocurrencies after the collapse of a Bitcoin trader, alleged to be the country’s largest Ponzi scheme. The Financial Sector Conduct Authority (FSCA) is making proposals to regulate trading in cryptocurrencies such as Ethereum, XRP and Litecoin, the watchdog’s head of enforcement, Brandon Topham, said by phone. The FSCA has handed details of its probe into the failure of Mirror Trading International Ltd to a top police unit after uncovering alleged fraud. “At the point something becomes a Ponzi scheme, we have lost our jurisdiction,” he said. “We need the police and the prosecuting authority to work fast and put people in jail.” MTI, which in November claimed it had 260,000 members and 23 000 Bitcoin now worth about US$740 million — was placed in provisional liquidation last month after clients battled to withdraw funds. On December 22, the fi rm’s management said in a letter posted on telegram that they were misled and that the company’s chief executive offi cer Johann Steynberg may have fl ed to Brazil. Four temporary overseers must now begin tracing MTI’s investors to recover the fi rm’s assets, including money allegedly paid to some early players that runs into millions of rands. The FSCA investigation found that the company kept neither accounting records nor a comprehensive register of participants, apart from 170 000 unique email addresses found during an October raid. The FSCA investigations hadn’t concluded MTI to be a Ponzi scheme and the regulator only noted it was trading without a license, Clynton and Cheri Marks, who joined the fi rm in August as head of the referral program and head of communications respectively, said in an email sent by their lawyer, Henry Selzer. “MTI set out to see what requirements are necessary to obtain a license,” they said. “When it became apparent that such a license would be impossible to obtain, Johann Steynberg moved MTI to crypto-trading for which apparently no license was required. The live trades were demonstrated to the FSCA during 2020 and MTI cooperated with every request from the FSCA.” A quadrupling in the price of the world’s best-known digital token toward the end of last year has been accompanied by convictions abroad in scams tied to digital platforms and speculation that authorities globally will seek tighter controls. While the Marks have had no contact with Steynberg, or knowledge of his whereabouts since the matter came to light, they are sure he “will repay to members their Bitcoin investments as that is the character of the Johann Steyn- berg they came to know,” their lawyer said. The couple denied any negligence. Regulators and liq- uidators were unable to supply contact details for Steyn- berg. MTI’s membership base stretched across the globe. The Texas State Securities Board in July issued a cease-and-desist order against it. At present, the FSCA hasn’t received formal requests to assist law-enforcement agencies abroad but is expecting queries, Topham said. — Bloomberg The Financial Gazette January 25-February 03 2021 | Page 25 News IMF warns poor countries debts to soar Farai Mabeza overwhelmed by crisis costs and rising Investment Bank seeking debt relief and pected between China—where effec- sponse to combat the fallout, shape re- Staff Writer poverty,” the IMF said. an arrears clearance programme as it tive containment measures, a forceful covery profiles," the IMF said. The Bretton Woods institution added sought to structure its way through the public investment response, and central Global trade volumes are forecast to HE level of debt for low income that debt restructuring may be unavoid- pandemic crisis but found no joy. bank liquidity support have facilitated a grow about eight percent in 2021, before developing countries is set to soar able for some of the countries. The country has struggled to keep strong recovery—and other economies. moderating to six percent in 2022. Tas they grapple with the effects of “While temporary liquidity relief can up with payments on US$8 billion of Oil exporters and tourism-based Services trade is expected to recover the Covid-19 pandemic, the Internation- help mitigate the lack of policy space, external debt and this, according to the economies within the group face par- more slowly than merchandise volumes, al Monetary Fund (IMF) has warned. for some countries it may not be enough IMF, made the country ineligible for aid ticularly difficult prospects consider- however, which is consistent with sub- In its World Economic Outlook Up- in situations where sovereign debt is extended to some of its peers in response ing the expected slow normalisation of dued cross-border tourism and business date for January 2021, the IMF noted unsustainable” the IMF said and urged to the Covid-19 pandemic. cross-border travel and the subdued out- travel under lockdown restrictions in that these countries were already strug- eligible countries to work with creditors The IMF expects sub-Saharan Af- look for oil prices. many jurisdictions. gling with unsustainable debts before to restructure their debt under the new rica, where most of the countries fall The pandemic is expected to reverse Reflecting the projected global re- the pandemic. Common Framework agreed by the G20 under the low-income developing the progress made in poverty reduction covery, oil prices are expected to rise in “Low-income developing countries “More generally, improving the in- countries category, to register growth across the past two decades. According 2021 just over 20 percent from the low have far less policy space, and many en- ternational debt architecture to support of -2,6 percent for 2020, 3,2 percent for to the IMF close to 90 million people are base for 2020, but will still remain well tered this crisis with high debt that is set orderly debt restructuring would benefit 2021and 3,9 percent 2022. likely to fall below the extreme poverty below their average for 2019. to rise even further during the pandemic. not only these countries but the system According to the update, emerging threshold during 2020/21. Non-oil commodity prices are also “Support from the international as a whole”. market and developing economies are "Across regions, vulnerabilities, eco- expected to increase with those of met- community through grants, concession- Last April Zimbabwe wrote to the also projected to trace diverging recov- nomic structure, and pre-crisis growth als, in particular, projected to accelerate al loans, and debt relief will be essential IMF, World Bank, African Develop- ery paths.] trends, together with the severity of the strongly in 2021. to ensure that these countries are not ment Bank, Paris Club and European Considerable differentiation is ex- pandemic and the size of the policy re- [email protected]

SA stocks slide for second day after IMF cuts growth forecasts

OUTH Africa’s main stocks index extended declined for a second day, falling 0,2 percent by 10:13am Syesterday in Johannesburg, amid weakness in BHP and Anglo American as fellow benchmark heavyweights Naspers and Richemont dropped. The four stocks account for 48 percent of the gauge by value. Wednesday’s weakness came after the International Monetary Fund (IMF) cut South Africa’s growth forecasts, even as it raised its projection for global expansion. Stock markets are mostly treading water near record highs as investors seek more clarity on the timeline for Pres- ident Joe Biden’s US$1,9 trillion Covid-19 relief plan, and awaiting the Federal Reserve monetary policy decision later Wednesday. “Global stocks are likely to trade sideways today as market participants weigh the IMF’s upward revisions to the global growth outlook against hurdles to further economic stimulus, while caution is likely to prevail ahead of the Fed’s policy statement,” Mpho Molopyane, a Johannesburg-based economist at FirstRand’s Rand Merchant Bank, said in a note to clients. “Expectations are that the Fed will keep to its accommo- dative stance to aid with the economic recovery.” An index of mining stocks retreated for a fourth consecutive session, down 0,7 percent to the lowest since January 6 as China’s commitment to cutting steel production this year dragged on iron ore prices, and as platinum prices retreated. BHP -1,1 percent to cause the biggest drag on the FTSE/ JSE Africa All Share Index. Anglo American -0,9 percent, Exxaro Resources -1,2 percent, Glencore -1,8 percent, Afri- can Rainbow Minerals -0,7 percent. Platinum companies declined for a fourth session, the longest losing streak since October 30. Sibanye Stillwater -0,8 percent, Northam Platinum -0.4 percent. Richemont extended declines to a the third day. Mean- while Naspers erased gains of as much as 0,6 percent to fall 0,4 percent. Vodacom dropped 0,6 percent as parent Vodafone Group Plc considers options for its Ghana business as it focuses on reorganising the group and paying down debt. Foreigners remained net sellers of South African stocks for a fourth consecutive day Tuesday, disposing of R1,05 billion worth of shares, according to exchange operator JSE Ltd. That’s the largest outflow since the year started. — Bloomberg Page 26 | January 28-February 03 2021 The Financial Gazette News Zimbabwe: Gross domestic product Wall Street expects near-record in current prices from 1998 to 2025 iPhone sales in Q1 URING the last three months of 2020, Apple Inc delivered its fl agship iPhone 12 model weeks later Dthan normal iPhone debuts and shuttered some of its stores due to the pandemic. But Wall Street is still expecting a near-record sales quarter for the Cupertino, California company’s signature device when it reports fi scal fi rst-quarter earnings on Wednesday, with estimates of US$59,8 billion, according to IBES data from Refi nitiv as of January 26. If Apple beats the number, it could eclipse its all-time record of US$61,58 billion in iPhone sales for the fi rst quarter of fi scal 2018. Analysts largely attribute the boost to the timing of the iPhone 12 lineup, which had a new look, 5G cellular data connectivity and new models at the top and bot- tom of the sizing range. “They have an extremely good understanding of what their refresh cycle looks like and when waves are possible and whey they are not,” said Ben Bajarin, head of consumer technologies at Creative Strategies. “Every bit of data across China and Europe has shown that not only was the installed base getting older, but people were not refreshing. I think (Apple) knew it would be a heavy refresh cycle.” Analysts also expect strong Mac sales of US$8,69 billion, according to Refi nitiv data from January 26, thanks in part to the introduction of models with the fi rst central processor chip for its laptops and desktop that Apple designed itself. Overall, analysts expect US$103,28 billion in sales and earnings per share of US$1,41 for Apple’s fi scal fi rst quarter. A “super cycle” of booms in iPhone sales after several more modest years are not new to Apple — the company’s previous high came after it announced the iPhone X, with a new design. THE statistics show Zimbabwe’s gross domestic product (GDP) from 1998 to 2019, with projections up until 2025. GDP denotes the During previous cycles, Apple’s shares often traded at aggregate value of all services and goods produced within a country in any given year and it is an important indicator of a country’s lower price-to-earnings ratios than its rivals due to Apple’s economic power. In 2019, Zimbabwe’s GDP amounted to around US$18,7 billion . — Statistica dependence on the iPhone. — Reuters The Financial Gazette January 28-February 03 2021 | Page 27 News ‘SA has rolled out measures to limit economic impact of Coronavirus’

RESIDENT Cyril Ramaphosa has support scheme, a loan guarantee scheme delivered a virtual address to the administered by South Africa’s banks and PWorld Economic Forum (WEF) Da- the deferral of the payment of certain tax- vos Dialogues. es. WEF is convening the Davos Dia- “As we battle a second wave of coro- logues from January 26-29 to discuss and navirus infection here in South Africa, we determine a post Covid-19 socio-econom- are in no doubt that the road ahead will be ic order. difficult. The President said: “As we confront “However, we draw hope and encour- the devastation caused by the coronavirus agement from the way that the people of pandemic, humanity is facing an unprece- South Africa have come together to con- dented global health, social and economic front this disease,” said Ramaphosa. crisis”. As the current chair of the Afri- The pandemic has triggered a global can Union (AU), Ramaphosa said the economic downturn of massive propor- AU moved quickly to develop a conti- tions, which has not been seen since the nent-wide Covid-19 response plan. Great Depression of the 1930s. This includes an Africa medical sup- Ramaphosa said the world faced a plies platform which will assist all AU common threat and needed to act together member states to secure vital health sup- to defeat the virus. plies at preferential rates. “The coronavirus pandemic has exac- The AU’s Covid-19 African vaccine erbated existing problems that we created acquisition task team has secured a pro- and it is therefore our task to forge a new visional 270 million doses for African path towards a world that is just, peaceful, countries directly through vaccine man- cohesive, resilient and sustainable.” ufacturers. This is in addition to the 600 According to the President, multilat- million doses that are expected from the eral action is the solution the world could Covax initiative. use to solve the challenges the coronavirus Ramaphosa said: “We are deeply con- has brought on. cerned about the problem of vaccine na- “The pandemic has underscored the vi- tionalism, which, unless addressed, will tal importance of multilateral institutions endanger the recovery of all countries. in facilitating coordination, cooperation Ending the pandemic worldwide will re- and common responses.” quire greater collaboration on the rollout In South Africa, the pandemic has tak- of vaccines, ensuring that no country is en a heavy toll with around 1.4 million left behind”. Covid-19 cases and more than 40 000 Beyond Covid-19, climate change is an people having lost their lives. area that requires common global action. The current economic downturn fol- Climate change is a key priority for lows a decade of weak economic growth. Africa, as the continent is affected by it, South Africa has rolled out a comprehen- despite releasing the lowest carbon emis- sive set of measures to limit the social and sions. economic impact of the pandemic. “If the last year has shown us anything, These include working together with it is that collaboration, partnership and business, labour and civil society to de- solidarity are the most effective instru- veloped an economic reconstruction and ments we have to build a better, fairer and recovery plan. more prosperous world,” the President Other relief measures included a wage said. — IOL Chiyangwa’s firms to build three hospitals Freedom Mashava improve the country’s healthcare system. Staff Writer The business tycoon said he was going to bring in medical experts to man the facility ATIVE Investments Africa Group adding that there were no health institutions founder and property mogul Philip in the northern suburbs. NChiyangwa is constructing three “Basically, this place (Chisipite Hospi- state-of-the-art hospitals in Harare as he tal) has about 111 beds. However, we were seeks to add to the country’s growing need forced to put the projects on hold because our for healthcare infrastructure and medical South African partners were overwhelmed equipment. by the Covid-19 pandemic. As soon as the The properties being constructed in pandemic is over, we are ready to roll. We Borrowdale, Bluffhill and Chisipite, are ex- have since revived our discussions and we pected to alleviate the country’s health crisis look forward to finalising and opening the spawned by outdated equipment, drug short- hospital. ages and recurrent strikes by nurses and doc- “This place (Borrowdale) has already tors over salaries and working conditions. been built with about 120 beds that will be “This is a specialist hospital (Chisipite available as soon as possible. Then, we have Hospital) … the idea was conceived when got the largest maternity setup which is in I started going for my medical operation, Bluffhill … this one is ready. So, I guess that that’s when I thought this business of fly- the whole position is that we need to make ing someone out of the country for medical sure that everything that is there works. We treatment was not good … what if I can’t will make sure there is constant supply of make it on my way there,” Chiyangwa said. medical essentials from the international “We don't want to airlift somebody be- partners,” he said. cause they are now gasping for life, we want Chiyangwa’s projects come at a time to have a place where things can happen lo- when the government is battling to contain cally, so these are the three facilities that will the Covid-19 pandemic and the country’s be ready for take-off as soon as the doctors public health care system is teetering on the have gotten the necessary medical and pro- brink of collapse with shortages of basic fessional approvals,” he said. drugs and equipment and an overburdened Chiyangwa also urged other Zimbabwe- and underpaid staff. ans to embark on projects that empower and [email protected] Page 28 | January 28-February 03 2021 The Financial Gazette Regional News Pula raises US$6mln to de-risk farmers ULA, an African InsureTech ser- and Thomas Njeru, Pula designs and delivers in- vice provider that specialises in novative agricultural insurance and digital prod- P digital and agricultural insurance ucts to help smallholder farmers endure climate to de-risk millions of smallholder farm- risks, improve their farming practices and bol- ers across Africa, has closed a $6 mil- ster their incomes over time. lion Series A fundraise. For smallholder farmers in emerging markets, The Series A fund was led by TLcom the traditional method of calculating insurance Capital, with the participation of Wom- through farm visits is often unaffordable for en’s World Banking. farmers, meaning these farmers are often ne- The new investment will be used to glected from financial protection against climate scale up operations in the company’s ex- risks. isting 13 markets across Africa. Through its Area Yield Index Insurance prod- Currently, Pula has impacted over 4,3 uct, Pula leverages machine learning, crop cuts million farmers on the continent and the experiments and data points relating to weath- new funding will also help propel its er patterns and farmer losses to build products expansion into Asia to power resilience which caters for a variety of risks including and profitability for Asian smallholder drought, excessive rainfall, pests and diseases. farmers. The company’s key clientele includes the likes Pula provides insurance to smallholder farmers in emerging markets. Launched in 2015 by Rose Goslinga of the World Food Programme, Central Bank of Nigeria, Zambian Government and the Kenyan Government. Pula has also launched an NDVI Livestock insurance as an offering for livestock farmers. “When Thomas and I launched Pula in 2015, we had one goal in mind — to build and deliver scalable insurance solutions for Africa’s 700mn smallholder farmers and with our latest funding, now is the time to break into new ground. "In our five years since launching, we’ve built strong traction for our products but the fact remains that across Africa and other emerging markets, there are still millions of smallholder farmers with risks to their livelihoods that have not been covered,” Rose Goslinga co-founder and co-chief executive speaking at the new fundraise said. “In the midst of a global pandemic, farmers need assurances now more than ever and with this in mind, it’s time to scale up. "Having TLcom Capital and Women’s World Banking along on the journey with us, opens up many more opportunities as we build across the continent and beyond.” Through its partnerships with banks, governments and agricultural input companies, Pula is at the centre of an ecosystem which provides insurance to smallholder farmers and has amassed 50 insurance partners, as well as six reinsurance partners. In December 2020, the start-up was named as the “InsurTech of the Year” at the Af- rican Insurance Awards 2020 held in Lagos, Ni- geria. As part of the new fundraise, TLcom’s Senior Partner Omobola Johnson will join Pula’s board. “In Pula, we found a company addressing a hugely underserved market in one of Africa’s key drivers of growth and with this, an opportunity for major economic upside. "The potential for the insurance market for smallholder farmers in Africa is huge and under the leadership of Rose and Thomas, Pula has rapidly established a strong presence throughout the continent and has a number of high-profile clients on their books. "We are confident of Pula’s potential for growth in spite of the pandemic and look forward to partnering with them as they execute the next phase of their journey.” Maurizio Caio, managing partner and founder at TLcom Capital. “Given the legions of women engaged in small-hold farming and securing the food supply for communities around the globe, Wom- en’s World Banking is delighted to partner with Pula advisors in providing them financial safety nets against the risks of pests, disease and climate change,” Christina Juhasz, CIO at Women’s World Banking said. In 2018, Pula announced the close of its US$1 million seed round from Rocher participations with support from Accion Venture Lab, Omidyar Network and several angel investors. Previous funders have included the Bill & Melinda Gates Foundation, Mulago Foundation and Mercy Corps Social Ventures and the company presence in Africa currently extends to Senegal, Ghana, Mali, Nigeria, Ethiopia, Madagascar, Tanzania, Kenya, Rwanda, Uganda, Zambia, Malawi and Mozambique. — thecalabashnewspaper. The Financial Gazette January 29-February 03 2021 | Page 29 National News BDO to investigate asset stripping at CSC

Adelaide Moyo as ranches, abattoirs, processing and Staff Writer meat and meat products distribution, and then privatised in a manner that HE ministry of Agriculture has allows for strategically focused in- appointed BDO Zimbabwe’s vestors to bring in investment, dyna- TNgoni Kudenga to investigate mism, skills and innovation targeting claims of asset stripping at the Cold these areas along the value chain,” Storage Company (CSC). Machadu said. The defunct state-owned meat “For that to happen, the govern- processor and marketer is currently ment must clear the company’s debts under a court sanctioned corporate through a long-term concessionary rescue plan which protects the com- loan, to make the unbundled units pany from litigation. attractive to investors. Otherwise, “The corporate rescue practitioner this approach of trying to revive the Kudenga, will head the CSC rescue entire vertically integrated company plan and as such will have overall Anxious Masuka will only be hoping against hope.” the liquidation of CSC while ensur- “CSC finds itself in a much differing that it remains in a solvent state that the investor would use CSC’s ent environment than it was during its for the benefit of the company’s assets and extinguish the company’s heyday, as many competitive players stakeholders, creditors including the liabilities and debts. have entered the market and claimed company’s workers. The objective is Masuka said the process was de- space. The company’s yesteryear to avoid liquidation and bring CSC layed by a myriad of issues which business model is also now impotent back to profitability and contribute necessitated the placement of CSC in this economic market architec- to the livestock growth plan and under a corporate rescue plan. ture; with antediluvian machinery, National Development Strategy 1,” After signing the deal, the govern- systems and human capital, and a Anxious Masuka, the minister of Ag- ment had been confident Boustead parasitic management thriving on riculture said in a statement. would also pay off CSC’s financial corruption. The export market is also The corporate rescue practitioner debts amounting to US$42,530 mil- now characterised by tough export is expected to investigate CSC af- lion and pay rentals of US$100 000 market access conditions as well as fairs, business and property and the per annum during the first five years high sanitary and phytosanitary stan- financial situation in terms of the of the agreement. dards. Any revival effort that pays no Insolvency Act and to investigate In return, the company would serious attention to confronting these previous CSC operations and expose take over and run the management of realities would be futile to hope,” weaknesses within the systems and CSC ranches in Maphaneni, Dubane, Machadu added. recommend possible solutions. Umguza, Chivumbuni, Mushandike, CSC was once a major meat pro- Kudenga is also expected to insti- Willsgrove and Darwendale for an cessor on the continent, processing tute measures to stop asset stripping initial period of 25 years. 150 000 tonnes of beef products immediately and investigate adher- Clemence Machadu, an economic annually and exporting about 9 000 ence to corporate governance prin- analyst, said the meat processor and tonnes of beef into the lucrative Eu- ciples and recommend aspects that marketer should be unbundled into ropean market, but mounting debts require strengthening. several businesses. and poor corporate governance CSC entered a joint venture agree- “It is my view that CSC should dragged it into insolvency and it has ment with Boustead Beef in January be unbundled into leaner strategic been moribund for years. 2019 and part of the agreement was businesses operating independently [email protected] ‘Zimbabwe dollar depreciated by 79 percent in 2020’

HE Zimbabwe dollar depreciated period,” the financial service group said. by 79 percent against the US dol- “As we go into 2021, if such foreign Tlar on the official market in 2020, currency auction bottlenecks are not a financial services group has said. dealt with timeously, they could threat- In its 2020 review and 2021 outlook, en the viability of the market which has First Mutual Wealth (FMW) said much been instrumental in bringing lower of the depreciation occurred during inflation and a sense of stability in the June and August when the market was macro-environment,” said FMW. adapting to the new Reserve Bank of Commenting on the Zimbabwe Zimbabwe (RBZ) measures of replac- Stock Exchange’s (ZSE), FMW said ing the interbank market with weekly the local bourse’ performance in 2020 foreign exchange auctions to determine was ahead of official inflation numbers the Zimbabwe dollar exchange. and official currency depreciation as “Officially the ZW$ currency depre- the All Share Index advanced 1 045,9 ciated by 79 percent against the US$ in percent, with inflation closing the year the course of 2020. Most of the currency at 348,6 percent and the ZW$:US$ ex- devaluation occurred during the early change rate moving by 387,6 percent. stages of the introduction of the RBZ “The market did offer real returns auction for foreign currency between for investors in 2020. However, on the June 2020 and August 2020 where the downside, the market experienced mar- ZW$: US$ Exchange rate moved from ket suspensions that had a negative im- ZW$25:US$1 to ZW$83.3994:US$ 1,” pact on pension fund liquidity for 2020. said FMW. “This includes the suspension of Since then, the exchange rate has Seed-co International, PPC and Old been more or less stable averaging cir- Mutual Limited on June 26, 2020 and ca US$30m per auction every week as their continued absence from the ZSE the exchange rate closed the year at as at December 31, 2020. This was even ZW$81,7866: US$1. after the market’s brief suspension from “We do however have to highlight June 26, 2020 to August 3, 2020,” said that towards the end of the year, for- FMW. eign currency auction participants were Whilst Seed-co International list- complaining of the delayed honouring ed on a separate local bourse designed of currency bids and some participants specifically for foreign currency-based indicating under allocations to what was trading (the VFEX), Old Mutual and bid for. Unconfirmed reports also indi- PPC have not resumed trading on any cated an increased premium between local stock exchange and this presents the official exchange rate and informal liquidity risk for investors holding the market exchange rates during the same shares. — Staff Writer Page 30 | January 28-February 03 2021 The Financial Gazette

JANUARY 19, 2021

1.0 The continued good rains have raised the national dam levels to 70°/o with a number of dams filling up and spilling. The country's largest inland dam, Tugwi-Mukosi in Masvingo Province, is fast filling up and is now expected to spill in the coming days. Since the commissioning of Tugwi-Mukosi dam in 2017, the dam will be filling up and spilling for the first time.

2.0 As of this morning, Tugwi-Mukosi dam was 86% full surpassing the highest level of 78%, recorded in 2018.

3.0 The anticipated filling up and the possible spilling of the dam have the potential of causing floods for communities downstream, especially those communities along the Tokwe River up to its confluence with Runde River.

4.0 While the inflows into Tugwi-Mukosi dam are still within the design flood capacity of the dam and the dam will operate as per design as it spills, Government through the Zimbabwe National Water Authority (ZINWA), has activated the necessary structures and put in place measures to protect the dam, the environment and the communities downstream.

5.0 ZINWA has the responsibility of minimising water related disasters in accordance with Section 5(c)(iii) of the ZINWA Act (20:25) which requires it to "... take appropriate measures to minimise the impacts of droughts, floods or other hazards ...".

6.0 ZINWA and relevant Government structures have started awareness campaigns and distributing information to affected communities.

7.0 While this coordinated whole of Government approach has been activated in this regard, we are appealing to communities that are likely to be affected, in the case of flooding, to remain on high alert, to be vigilant and we urge communities to:

• Desist from crossing flooded rivers; • Desist from carrying out laundry, bathing or swimming in the rivers; • Ensure that children do not visit or go in the vicinity of rivers without adult supervision • Ensure that any water abstraction equipment along the rivers is immediately evacuated and appropriately protected. • Ensure that livestock, especially cattle, are penned and not used to facilitate river crossings.

8.0 The Government of Zimbabwe will also relay relevant information to Mozambique, through the Joint Water Commission, for the Pungwe, Buzi and Save Basins to facilitate further coordinated responses.

9.0 Additional information shall be issued by the relevant Government arms. Life & ArtsNews Worth Knowing January 28-February 03 2021 Page 31 Getting your house in order during lockdown S Cyclone Eloise, now Last year, readers were ad- months. Dried beans don't last awaiting the re-opening for take downgraded to a tropical vised to stock up their pantries forever, even if stored in a cool, away meals of Sabai Thai Restau- Astorm, wreaks havoc in with dried beans, lentils, barley, dry place. rant in Stokesay Close, Ballan- Mozambique and dumps rain on rice and kapenta. I filled the top I found that six months after tyne Park. I've tried with little South Africa and Zimbabwe, it shelf (accessible only by step-lad- purchase, haricot beans and chick success to re-create crispy pork feels good to be safe and dry, and der) in my pantry with essential peas that were soaked overnight belly stir fry, a favourite dish en- have a roof over my head. lockdown items in 2020, all of and simmered for hours, re- joyed in The Before Time. If the street was knee-deep in which remained undisturbed. mained hard and inedible. Until Sabai Thai is able to re- water, and the roof tiles on my I thought it prudent this Janu- Always check the sell by date open, this fragrant combination of house were floating down the ary to look at expiry dates on tins, when looking at dried goods, as deep-fried pork belly with soy Mukuvisi, there would be greater and to check the condition of they may have rested several sauce, fish sauce, oyster sauce, concerns than dealing with a 30 packed dried goods. months in a warehouse or on a su- garlic, chillis, sugar and Thai ba- day lockdown and a 6am to 6 pm The baked beans were good permarket shelf before you sil, that can only be achieved by curfew, in response to the virulent until next year, as were the tinned bought them. Chef Ning and Chef Pimwipa, and rapidly-spreading Covid-19. peas and tinned tomatoes; the best As much as I enjoy spending will remain a distant memory. Being confined to barracks before date, however, on tins of time in the kitchen, trying out new We have no idea how long the can be considered an opportunity pineapple and apricots, had recipes or cooking old favourites, pandemic will take to run its to sort out domestic affairs, previ- passed shortly before purchase my real interest as a food writer is course, or when a vaccine agains ously ignored in the rush to wash last March. in eating out, interviewing chefs, the virus will be made available to and dress and travel to an office, Packets of dried beans ap- Crispy pork belly from Sabai Thai Restaurant. and visiting as many restaurants Zimbabweans. where one hoped to salvage busi- peared slightly shrivelled, but the as time will allow. But in the mean time, in addi- ness opportunities in a rapid- packs of pearl barley and stone- item before putting it in your trol- economy if you plan to stock your Restaurateurs who have had tion to stocking the pantry shelves ly-dwindling economy. ground wheat flour were a mass ley. shelves for the months to come. their operating licences renewed to help us survive the lockdown, Do you remember the list of of weevils. Prices on goods may be re- If properly packaged and by ZTA are going big on takeouts, there is much more needing to be essential to-do items you made Luckily, the packet of white duced when sealed, white rice advertising their menus on vari- done to get our house in order. during the last lockdown? And rice was still intact, and the lentils, the expiry date will store well for ous social media platforms. I'll be touching on this in the never completed? orange, brown and green, all has been A Matter of Taste at least two years, Because restaurants and all coming weeks, in addition to re- If not, rummage through the looked as good as new. reached, but with although brown their employees need our support, porting on takeouts available in desk drawer for your notebook So when shopping for your saving money rice, the healthier my sole New Year's resolution for my hood. containing important lists, and get lockdown larder this year, exam- here and there Charlotte Malakoff alternative, will go 2021 is to eat more takeouts. Comments to: cmalakoff@ started. ine the best before date on every could be false rancid after six Hungry fans are eagerly gmail.com FOUR-TIME Australian Open singles champion Serena Wil- liams has praised Australia’s “super, super strict” quarantine rules as she prepares for her 20th entry into the grand slam. Wil- liams is one of a select group of star players quarantining in Ade- laide, which has been the source of some angst from other players News Worth Knowing in Melbourne. Williams, who has travelled with three-year-old daughter Olympia, said that the rules were “insane and super Sport intense”, but she had no problems with it. Page 32 January 28-February 03 2021 SPORT SHORTS Tokyo Olympics swim Mayweather vs McGregor on FLOYD Mayweather versus Conor McGregor II is on course for Saudi Arabia — on a mega-money cruise ship. McGregor, 32, had plenty of irons in the fire before the weekend but his shock second-round KO loss to Dustin Poirier on Saturday’s against a tide of doubt UFC show in Abu Dhabi wrecked his plans for a boxing bout with Manny Pacquiao.And Mayweather wasted no time before HEN the Tokyo Summer Olympic steaming in and insulting The Notorious, in the perfect way to Games were postponed in March of last kick-off the hype around their potential second blockbuster. Wyear, organisers had a vision: In July Before the ice pack on McGregor’s battered right leg had 2021, a torch would be carried into the city’s new even melted, the 50-0 boxing legend called him 'Conman Art- National Stadium, and its flame would bring the ist McLoser' and panned his bid to face eight-weight icon Pac- Olympic cauldron to life. quiao, who Mayweather beat in 2015. The Tokyo Games would also be emblematic of Money Man said: “Just know, that bum will never be me or mankind’s victory over the coronavirus and a source be on my level. of renewed hope for the planet. "I’m just built different, my mindset is on another planet, my Six months before those Opening Ceremonies skills are second to none, I’m a natural born winner and yes I are scheduled to take place, the International Olym- talk a lot of trash, but every time I back it up." – thesun.co.uk pic Committee and Japanese Prime Minister Yoshi- hide Suga maintain that that vision will become reality. But the virus is not so easily beaten, and the past Andy Murray will be back two weeks have obscured such optimism in a fog JAMIE Murray believes brother Andy can still get back to of doubt. Gripped with its worst wave of infections playing at the highest level and feels 2021 is shaping up to be a since the pandemic began, Japan placed Tokyo un- "huge" year for him. der a state of emergency on January 7. Three-time Grand Slam champion Murray, 33, was forced to The sports world also felt the effects of the rising withdraw from next month's Australian Open after being unable virus numbers. Outbreaks among scores of Japanese to find a "workable quarantine" following a positive Covid test. sumo wrestlers as well as badminton, rugby and ta- "He's done incredibly well to get to this point where he feels ble tennis players have led to mass withdrawals or Organisers acknowledge risks but insist meticulous preparations are being made to ensure the like he's in a position now to go out and compete against the best outright cancellations in the past two weeks. Games can be staged safely. players in the world," Jamie told the Bunkered podcast. Outside Japan, the Australian Open was thrown "It's obviously been incredibly frustrating for him because into disarray when air passengers coming from qual- nation, with its island mentality. unsafe Games could frankly destroy a lot of the value he's had a lot of setbacks along the way. It's been very stop-start." ifying tournaments in Qatar tested positive on arrival. The case for some domestic spectators is stron- that the Games stand for and aspire to.” This year's Australian Open is the third in four years the Even as Tokyo 2020 organisers insisted their de- ger. On January 4, more than 24 000 physically The IOC already has asked competitors to min- younger Murray has missed and his ninth slam out of 13. termination to hold the event was “unwavering,” a distanced spectators attended the season finale of Ja- imise their time in the Athletes Village, arriving five He was only able to play seven official matches in 2020 senior Japanese government minister admitted the pan’s professional soccer league at the new National days before and leaving 48 hours after their events because of a lingering pelvic issue and the five-month corona- decision on whether to hold the Games could “go Stadium, where the Opening Ceremonies are set to when possible. The Australian Open model — 14 virus-enforced suspension of tennis. His next event is likely to either way.” take place. days of pre-tournament quarantine — won’t be be either February's Open Sud de France in Montpellier or the Public opinion in Japan has also soured, and the Even under the state of emergency, Tokyo is al- considered, but officials said training sites across the Rotterdam Open in March. – bbc.com resignation of former prime minister Shinzo Abe on lowing 5 000 spectators at sporting events, appropri- country could be made available for national teams health grounds in September last year robbed the ately spaced out, wearing masks and refraining from who wanted to arrive early, allowing more time for Games of its biggest believer in the government. cheering and shouting. training and acclimatisation — and coronavirus test- Hamilton stalling on contract The suspicion that Japan may be losing its nerve is Japan isn’t expected to begin vaccinating its pop- ing. FORMER motorsport team Eddie Jordan bosbelieves Lewis growing. ulation until late February, and medical experts say it Paralympians have been another major concern, Hamilton is digging in his heels over a new Mercedes contract But the people closest to the planning for the won’t be possible to inoculate everyone by July 23. especially if they have underlying heath conditions in a wrangle over money. Games insist a path remains. A year ago, the decision However, it should be possible to bring infec- that could put them at risk. But those concerns Hamilton has yet to sign a new contract with the team despite by the Australian and Canadian Olympic commit- tion numbers way down by then and have enough are overblown, insists Craig Spencer, chief brand insisting he was happy to commit to them. Merc boss Toto Wolff tees to withdraw their athletes helped force Abe to vaccine coverage — backed with rapid testing and and communications officer for the International said the two were in discussions over Zoom but admitted their agree to a postponement. Today, prospective visitors sensible precautions — to reduce the risks. Paralympic Committee. talks had caused a few "curveballs" for the lawyers overseeing sound much more confident. Although Tokyo 2020 spokesman Masa Takaya Getting vaccinated won’t be compulsory, but the the deal. The Olympic world was sent spinning on Thurs- said organizers are not willing to stage the Games IOC is encouraging Olympic attendees to do so, and But former team boss Jordan believes the sticking points are day last week by a report in the British newspaper, behind closed doors, that remains a fallback option: it hopes to work with the World Health Organisation over Hamilton's worth to Mercedes, who recently announced the Times, in which an unnamed Japanese govern- Kyodo News reported on Friday that the govern- to make sure athletes have access to supplies. petrochemical company, Ineos, had become a three-way owner ment official said the government had privately con- ment had begun to consider a spectator-free Games With qualifying events and Olympic trials sched- alongside Mercedes Benz and Wolff. cluded the Games would have to be canceled. as a way to avoid a cancellation. uled for the spring, the timeline isn’t long. But it is Jordan also says he understands the 36-year-old is pushing The report prompted swift denials from Japanese The bigger questions appear to be how to ensure long enough, former IOC marketing director Mi- for a 10 percent share of the team's TV revenue. and Olympic officials, and IOC President Thomas the safety of the Olympic and Paralympic athletes — chael Payne said. He said: "There are a number of things that could be causing Bach spoke on Friday with all 206 National Olym- and safeguard the integrity of the Games. “The key point is it’s six months away,” he said. a hold up and there have been some changes with the team." – pic Committees, reassuring them that plans for this Just this month, 65 wrestlers were forced to with- “And with the vaccine starting to roll out, the situa- thesun.co.uk summer are still on schedule. draw from a national sumo tournament in Tokyo tion in the world in six months’ time certainly will Rob Koehler, the director general of Global Ath- after contracting the virus or being in close contact look very different now than it does today.” lete, an international advocacy group for Olympic with someone who had, and 51 players were forced But a considerably closer date looms large in the Can the real Chelsea manager stand athletes, said the drawn-out process and the lack of to withdraw from the national table tennis champion- minds of Tokyo 2020 organisers and the govern- details surrounding the postponed Games had fo- ships in Osaka for the same reason. ment. On March 25, the Olympic torch relay is set THE New Chelsea manager Thomas Tuchel is a man of many mented distrust and consternation for many athletes Japan’s entire 22-member badminton team had to start in Fukushima prefecture, and no one wants monikers, but you would never have imagined the new Chelsea over the plans for 2021. to withdraw from the Thailand Open after men’s sin- a false start. boss would fancy himself as Germany's next top model. “We all know that every athlete wants to go to the gles world champion Kento Momota tested positive. Contractors start arriving in April, when plans The ex-PSG manager, who has replaced sacked Frank Lam- Games, but the question is at what cost? And I think The opening of Japan’s Top League rugby matches start to get cemented in place. Last year, the Games pard at Stamford Bridge on an 18-month deal, once posed for a that’s where the IOC has dropped the ball,” he said. was put on hold after 67 players and staff were found were postponed on March 23, just three days before fashion shoot in New York for Die Zeit’s men’s magazine. There are several key questions: whether it is to have the virus, and a cycling event in Wakayama the relay was set to begin. Tuchel, 47, had a stint as a barman, when he was forced to safe for spectators, athletes and the broader Japanese turned into a covid cluster, with 31 of 113 partici- Things may look better in six months’ time, but retire from the game aged just 24 — that he admits helped him public; whether the sporting integrity of the Games pants later testing positive. how much better will they look in two months? Will become a more confident person. can be maintained; whether the Japanese public can Former Japanese swimmer Takeshi Matsuda, Japan really be in position to guarantee a safe Olym- The German tactician is also one of a rare breed of football be brought around; and whether the timeline can be an Olympic medalist, said it would be a nightmare pics 60 days from now? managers who hold a degree — he juggled his job at Radio Bar managed. if an outbreak caused last-minute withdrawals at the “I can understand why people are nervous,” in Stuttgart alongside studying Business Administration at uni- Tokyo 2020 President Yoshiro Mori said at a Games. Spencer said. “One thing that ourselves, the IOC versity. public lecture this month that a “very difficult” de- “The Olympics are the top competition for and Tokyo 2020 need to get better at in the coming The differing facades of Tuchel paint not just an interesting cision on whether to allow spectators will have to be sports, and if the top athletes from around the world months is explaining to people why we’re optimistic personality, but one that's bound to light up the Premier League. made in February or March. can’t compete, for me that’s not a full-scale Olym- we can deliver a safe and secure Games. In 2017, few could believe what they were seeing — certain- The door to foreign spectators, though, seems pics,” he said. “We all believe we’ve got the plans in place that ly not German football fans anyway. to be closing, not least because the prospect of hun- Terrence Burns, a former IOC executive and can deliver these Games in a safe and secure way. Skinny Tuchel, who stands at 6ft 2in, was seen in trendy dreds of thousands of overseas visitors undoubtedly U.S.-based global sports marketing veteran, said ev- Twelve months ago, we didn’t have that.” snaps for ZEITmagazin Mann pulling off his best David Gandy has undermined public support for the Games in this eryone involved in the Games realizes “holding an — Washington Post impression. — thesun.co.uk The Financial Gazette January 28-February 03 2021 | Page S1

NATIONAL HEROES CONDOLENCES

SB Moyo: Epitome of Zim revolution’s finest cadre

Christopher Mutsvangwa As Zimbabwe National Liberation War Vet- site, all round politico-military operation. Even erans Association (ZNLWA), we look back the ever-prying eyes of vaunted Western intelli- OMRADE Sibusiso (SB) Moyo, the gen- with fond memories of the good-cop-bad-cop gence agencies were all caught by total surprise eral of the Zimbabwe Defence Forces ZDF-ZNLWA collaboration, leading to the ex- as ZDF-ZNLWA dictated pace that fateful No- Cwho pronounced the demise of the four traordinary and successful execution of Operation vember. decade-old Mugabe dictatorship in November is Restore Legacy. The tortuous journey had started at the Kwe- no more. The world was left in wonderment at the kwe military cantonment. General Mujaji and Comrade SB Moyo, what a journey we have events of November 2017. Comrade Blessing “Bombshell” Geza, both war- travelled. How could Zimbabwe deliver such an exqui- time comrades had pre-emptively called me to

Sibusiso Moyo

deliver a lecture. As the new chairman of ZNLWA as of the 2013 Masvin- go War Veteran Congress, it had been made sure that I sit in the politburo and cabinet of Robert Mugabe. What I found in Cabinet appalled me. Gross ineptitude by a dozing nonagenarian. I found the Cabinet to be a village-style debate of kleptomaniacs and ignoramuses com- porting themselves as ministers of State. The Kwekwe lecture gave me my chance to state it as it was to fellow wartime cadres. The “spy and the traitor” Jonathan Moyo had equally travelled to the Kwekwe cantonment to give a seminal re-ori- entation lecture. He was on a mission to win the hearts and minds of the ZDF officer corps. The Chimurenga war deserter had sadly underestimated the collective revolutionary consciousness residing in the ex-ZANLA-ZIPRA core of the ZDF. Unbeknown to the turncoat and traitor Professor, I arrived ahead of his time-slot. For the whole morning we schmoozed as he waited forlornly outside the lecture room. After I ended my presentation, everyone abruptly left. The cars sped away from the parking lot. Jonathan Moyo was left forlorn with a very late lecture and an empty lecture room. Sadly, being a rank and totally compromised outsider, he either failed or stubbornly refused to read the tea leaves. As seasoned guerrilla fighters enamoured to life and death danger, we went our own battle ways. Constitutional propriety foreclosed the army from engagement in politics. The ZNLWVA had no such qualms. We gladly and ar- dently decided to harry and harass the Mugabe Project. He had clothed it in his counter-revolutionary G40s of the Gang of Four. Mugabe had been onto it for a long time. I personally eavesdropped on him as he tutored his wife at the official am- bassadorial residence. This was during the 2006 state visit. The venal nonagenarian offered Mao’s Jiang Jing as the model for Grace Mugabe. The backdrop was a recollection of his 1977 maiden visit to Beijing as the new leader of Zanu. That was at the height of the Chinese Gang of Four Turmoil. My wife Monica hosted that dinner for the Mugabe couple. I tried to remind Mugabe of our shared sojourn at Zhunda Camp, Chomoio in 1975. An irate Grace rudely cut me out. All to my heartache of dismay. Such raconteur of humble beginnings in Mozambique guerrilla camps were no longer befitting. After all her husband, Mr President, was now donning the sartorial bespoke suits of Jermyn Street, London. Tea with the British monarchy was the ultimate act of an African social climber. This even as he frothed out cryptic Marxist jargon as a cover of a revolution, he secretly loathed. Jonathan Moyo, Saviour Kasukuwere, Grace Mugabe, Patrick Zhuwao were henceforth on a wild goose political chase. They were being egged on by Happyton Bonyongwe, the obsessively self-conscious CIO director-general. Not surprising at all. To Page S2 Page S2 | January 28-February 03 2021 SB MOYO cOndOlence Special Feature The Financial Gazette

Chris Mutsvangwa, left, with the late SB Moyo, centre, and Patrick Chinamasa. SB Moyo — epitome of Zim revolution’s finest cadre From Page S1 spected Zimbabwe military. Bonyongwe had spent the war years Then some trigger-happy figures in as a military instructor at the nachin- Western world military industrial estab- gwea Guerrilla academy. Meanwhile, lishment would have had the casus belli the war front was the 1 000km border for a military attack against Zimbabwe, with Mozambique and the Zambezi the way of the iraq invasion. river with Zambia. He had an estrange- the wily general SB Moyo duly ment to the battlefield exposure of his obliged. His tank turned around to face peers. the cloistered Mugabes. Our selected Back to the prelude of Operation youths then started to march surround- restore legacy. as of the Kwekwe ing it. direction: Blue roof House. lecture, the Vakomana who had freed the courage of Mugabe melted out Zimbabwe collectively assumed a new like a block of ice in a Zimbabwe Oc- mission — #Mugabe MustFall. tober sun. after all, through the Mgagao docu- the abdication letter was promptly ment, Zanla-Zipra had created the con- dispatched. this was as Grace fran- ditions for Mugabe’s political rise to tically and apoplectically called then national leadership and eventual global South african president Jacob Zuma’s stardom as a statesman. office to their rescue. She probably was there is a dictum. What guerrilla haunted by the last moments of Muam- freedom fighters give, they can also mar Gaddafi. take. Senator Monica Mutsvangwa was Their sacrifices had made a hero out saved from complete reading of the im- of an ordinary teacher in Mugabe who peachment charge sheet in a joint sit- studiously refused military training as ting of the Zimbabwe parliament at the was then called for by Zanu leadership Harare international conference centre etiquette. auditorium. the rump of the Zanla-Zipra war- the menacing prancing of Bon- time cadres were going to have the last yonge and his hangman noose had laugh. come to naught. a beleaguered Mugabe at his Blue up to this time, little did Mugabe roof House was refusing to sign an ab- and Grace know that we already had dication letter even when the political Zuma covered. i had already been to die was cast. cape town to liaise with Zuma’s inner Bonyongwe, now donning the man- circle tle of minister of Justice, had swords of Such is the wonder of collective damocles hanging above everyone. He sub-regional guerrilla consciousness. had after all signed fatwas against his the anc, pac, SWapO, Zanu pF, erstwhile war comrades. Zapu, Mpla and FreliMO had not For the first time since Kwekwe three shared the tenancy of tanzania guerril- years earlier, i got in touch with major la camps in vain. general SB Moyo. We were now open- We had our networks beyond the lat- ly, confidently and defiantly working as ter-day diplomatic pouch. team trio with cde Victor Matemadan- Hon Sibusiso Moyo, ZnlWa is ever da, the ZnlWa secretary-general. indebted to you. You are the epitome of We had finally cornered our quarry. the finest cadre from the crucible of the Our team trio choreography had Zimbabwe revolution. stationed tanks to block Mdc youths A freedom fighter comrade, a cadre, who wanted to march to the Blue a scholar, a soldier, an office, a general, House. statesman, a diplomat. You had all that they wanted to lynch the Mugabes endorsement of talent and capability in ahead of ZnlWa and Zanu youths. one man. that way they would spawn mayhem at Salute to a great Zimbabwean. Znl- Blue roof House. Wa will forever cherish your memory. all to stoke up global outrage n Ambassador Mutsvangwa is the against the ZnlWa and the well-re- chairman of the ZNLWVA. The Financial Gazette SB MOYO CONDOLENCE SpECiaL FEaturE January 28-February 03 2021 | Page S3 Global community mourns SB Moyo

HE global community has expressed shock the Canadian government, through its embas- and sadness at the untimely death of For- sy in Harare, also condoled with the Moyo family t eign affairs and international trade minis- saying: “We are saddened to learn of the passing ter Sibusiso Moyo (pictured) who succumbed to of the minister of Foreign affairs and international Covid-19 complications in the capital last week. trade, ... Moyo due to Covid-19. the former army general, famed for announc- “We extend, on behalf of the government of ing the November 2017 coup that removed the late Canada, our heartfelt condolences to his family and former president robert Mugabe, was married to the people of Zimbabwe.” High Court judge and Zimbabwe anti-Corruption “the Embassy of italy in Zimbabwe and staff Commission chairperson Loice Matanda-Moyo. are deeply saddened by the loss of ... Moyo. am- “His Excellency the president (Emmerson) bassador Carlo perrotta and the embassy staff send Mnangagwa, regrets to announce the passing on their condolences, heartfelt sympathy to the family early this morning of … Moyo, our minister of and friends of MinisterSBMoyo,” the italian em- Foreign affairs and international trade. bassy said. the late minister succumbed to Covid-19 at a the Swedish Embassy in Zimbabwe said: “am- local hospital. bassador @pehrsona and the Embassy of Sweden “the nation will be kept apprised of further in #Zimbabwe express sincere condolences on the developments regarding this untimely demise of passing of ... Moyo to his family, friends and col- the late minister, himself a decorated soldier and leagues.” freedom fighter,” Mnangagwa said in a statement issued through George Charamba, the acting chief secretary to the president and cabinet. Moyo, who had become the face of the country’s re-engagement thrust, had been making steady progress on that front, with Zimbabwe now beginning to enjoy warmer ties with countries for- merly regarded as adversaries.

"The Chinese Embassy in Zimbabwe is deeply saddened by the passing of … Moyo. Moyo has been a dear friend to China and a strong supporter of the deep friendship between China and Zimbabwe"

Several embassies sent messages of condolence, describing Moyo as a courageous diplomat, who played a key role in trying to bring Zimbabwe back to the family of nations, after years of isolation. European union ambassador to Zimbabwe timo Olkkonen said Zimbabwe had lost a professional Foreign minister. “While we had our fair share of differences of views and opinions, i always valued our frank, open and good-humored exchanges. We could always tackle even difficult issues head on. i will miss those exchanges,” he said. “While i can’t claim to have known him well on a personal level, i am well aware he was highly regarded also by his colleagues as a great personality. "i was very touched last year when he sent a personal letter of condolences when my own father passed away. MHSrip.” the Dutch ambassador in Harare, Barbara van Hellemond, said “the re-engagement process between Zimbabwe and the world has lost its champion.” the Chinese Embassy in Zimbabwe also issued a statement. “the Chinese Embassy in Zimbabwe is deeply saddened by the passing of … Moyo. Moyo has been a dear friend to China and a strong supporter of the deep friendship between China and Zimba- bwe,” the statement reads. “His outstanding contribution to the excellent relations between the two countries will be forever remembered. “in this sorrowful time, we extend our heartfelt condolences to the bereaved family and to the government and people of Zimbabwe. “May our condolences bring you peace during this painful time. China continues to stand strong with Zimbabwe to overcome the pandemic and all the challenges that may come our way in the years to come.” the russian Embassy in Zimbabwe said: “Em- bassy’s condolences on the passing away of Lt Gen (rtd) Hon Dr Sibusiso Moyo.” uK ambassador to Zimbabwe, Melanie robin- son said she was saddened to hear of the death of Moyo. “the uK stands by Zimbabwe in its fight against Covid-19,” she said. Page S4 | January 28-February 03 2021 SB MOYO CONDOLENCE SPECIAL FEATURE The Financial Gazette

ONAL RA TI P A ID N

R E M S P A OFFICE OF THE PRESIDENTO N S E T E AND CABINET CONDOLENCES THE LATE MINISTER OF FOREIGN AFFAIRS AND INTERNATIONAL TRADE, HONOURABLE LIEUTENANT GENERAL (RETIRED) DR. SIBUSISO MOYO

The Chief Secretary, Dr. Misheck Sibanda, Deputy Chief Secretaries, Heads of Departments, Chief Directors and staff in the Office of the President and Cabinet join His Excellency the President of the Republic of Zimbabwe, Cde. Emmerson Dambudzo Mnangagwa and the entire nation in mourning the passing on of Honourable Lieutenant General (Retired) Dr. Sibusiso Busi Moyo, a decorated son of the soil, a fearless freedom fighter and a distinguished nation builder who served his country diligently until his last portfolio as Minister of Foreign Affairs and International Trade. Cde. Moyo’s untimely demise during the early morning of 20th January 2021 cast another dark cloud over a nation that was still in mourning and preparing to bid farewell to two national heroes, the late Cdes. Dr. Ellen Gwaradzimba and Morton Malianga. Cde. S. B., as the late national hero was popularly known among colleagues in Cabinet, belongs to a unique generation of tried and tested cadres who saw it all in the trenches of the Liberation Struggle and never looked back after liberating their motherland from colonial subjugation. After independence in 1980, he pursued a flawless career in the military, playing a pivotal role in the emergence of the Zimbabwe Defence Forces as a formidable institution within the SADC Sub-region and beyond. The late General served as the Deputy Chief of Staff at the United Nations Peacekeeping Mission in Somalia in the early 1990s. As a true patriot of impeccable credentials, his affable character and love for team work will be sorely missed in Government, including at the Zimbabwe Institute for International Affairs as well as the Zimbabwe National Defence University where he played a pivotal role in building this institution of higher learning. He spearheaded the transformation of the Ministry of Foreign Affairs into its current structure incorporating International Trade. The transformation was geared towards placing the Ministry at the forefront of the engagement and re-engagement programme, with greater focus on promoting the country’s exports and attracting investment under the mantra Zimbabwe is Open for Business. Dr. Moyo was at the forefront of the campaign within SADC for the removal of the unjustified sanctions constraining economic development, leading to a consensus across the continent for their unconditional removal. The general consensus was also emerging at the Commonwealth for the country’s re-admission. Through his efforts, Zimbabwe had at the time of his death been rehabilitated into the community of nations, hence the invitation to the Africa Investment Conference which the United Kingdom would host towards the end of January 2021. Through the demise of Dr. Moyo, the country has lost a dedicated and energetic Minister. As Chairman of the Grain Importation and Logistics Task Force, Dr. Moyo worked tirelessly to guarantee adequate grain stocks after successive years of drought which adversely affected Zimbabwe’s agricultural production. Our deepest condolences go to Dr. Moyo’s family, particularly his widow and Chairperson of the Zimbabwe Anti-Corruption Commission, Justice Loice Matanda-Moyo, for losing a loving and supportive husband and father of their children. The couple had committed itself to public service through national programmes aimed at building a democratic, peaceful and prosperous Zimbabwe. The void created by the untimely departure of Dr. Moyo will be difficult to fill, hence our prayer to the Lord Almighty to grant Justice Matanda-Moyo and the entire family the fortitude to overcome grief and gather strength. To the departed General, we say “Go well, son of the soil. Go well, our towering Pan-Africanist and national hero. The resolve and humility which you exhibited in the few but impactful years at the helm of our international relations portfolio will indeed inspire your colleagues in Cabinet to continue the march towards the realisation of the objectives of Vision 2030.” May Your Dear Soul Rest in Eternal Peace.

Dr. Misheck. J. M. Sibanda CHIEF SECRETARY TO THE PRESIDENT AND CABINET 21st January, 2021 The Financial Gazette January 28-February 03 2021 | Page S5 FARMING FEATURE Pfumvudza to boost farm output John Bhasera The concept of Conservation Agriculture and grass (mulch) minimises impact of intense ations at the soil surface and also smothers First Principle: Reducing tillage opera- rainfall on the soil thereby reducing water run- weeds. OVERNMENT has introduced a new farming tions has an impact of reducing moisture loss off and soil erosion, as well as reducing evap- Third principle: Inclusion of legume-based concept called “Pfumvudza” to maximise pro- from inner soil layers (which are not exposed oration from the upper soil layers. rotations helps to improve soil fertility, reduc- Gductivity per unit area, even during drought pe- through tillage) and improves the soil structure All this has a net effect of increasing water es pest infestations and minimises total crop riods. in the long term, resulting in improved water infi ltration. loss during severe weather occurrences. The concept, if properly rolled out, can ensure house- infi ltration The mulch also minimises compaction by ●Basera is an agronomist and permanent hold and national food and nutritional security. It in- Second Principle: The presence of leaves intense rainfall, reduces temperature fl uctu- secretary in the Ministry of Agriculture. volves the utilisation of small pieces of land and applying the correct agronomic practices for higher returns. The approach can be used in marginal areas and still give high yields allowing smallholder farmers to achieve household food security, while large-scale farmers can produce for the strategic grain reserve. The concept of “pfumvudza” is crop production intensifi cation approach that allows farmers to concentrate resources (inputs and labour) on a small land unit to facilitate optimum management resulting in increased productivity. The programme is meant to support over 1,6 million vulnerable households for maize with a standardised input package of 5kg seed, 12kg lime, 50kg basal and 50kg top dressing fertilizers. This package is enough to cover two 0.06ha plots and benefi ciaries are expected to fully and religiously adopt Conservation Agriculture Princi- ples as a way to climate proof the programme. One plot is enough to feed an average family of fi ve people for a year, while the other plot will produce surplus for sale. This programme, however, requires a ro- bust and a well-capacitated extension provision system for technical backstopping, tracking and monitoring. Each extension worker will be required to establish as least a one demonstration plot and given targets to train, track and monitor the adoption of conservation agriculture by 350 households. For optimum benefi ts, planting on the food security plot should be done timely and this requires adequate preparatory activities that include, digging of planting basins before the start of the season and timely acquisition of inputs. The early land preparation (off-season) allows the farmer to plant their crop with the fi rst effective rains. To allow for supplementary watering or irrigation, the food security plots should, where possible, be placed near water sources. It is encouraged that farmers prepare two plots, one for cereals (maize or small grains) and one for legumes thus providing a protein source to complement the cereal. It has three key basic principles: •Use of minimum or zero tillage •Maintenance of organic mulch cover on the soil surface and •Use of crop rotations and interactions that include legume crops. Concept description The concept is a sustainable way of crop production intensifi cation, whereby farmers concentrate resources on a smaller piece of land thus reducing labour demand and resulting in higher productivity from lower investment, hence higher profi t margins. Placing three seeds in each planting hole, and later thinning to two, ensures the planting station has the required average of two plants per planting hole, ensuring an optimum plant population. The small land size ensures that the farmer is able to provide supplementary irrigation (water by hand) where water is available during dry spells, thus enhancing the resilience of the production system. Precision is extremely important when marking the planting station as this will ensure that planting is done at the same spot every year, allowing the plants to benefi t from residual fertility. Demonstration plot specifi cations •The demonstration plot size should be 16m x 39m (624 square metres). •Inter-row spacing of 75cm •In-row spacing of 60cm •Row length of 16m •Hence digging 28 holes per row, with two maize plants per each planting hole, making a total of 56 plants per row •Therefore 1456 planting holes with a total of 2 912 plants •A total of 52 rows, with each row producing a 20-litre tin of maize grain (one 20-litre per week for 52 weeks equals to one year), with the assumption that each plant produces at least one cob (15 t/ha) Page S6 | January 28-February 03 2021 FARMING JOURNAL SPECIAL FEATURE The Financial Gazette The ultimate 4x4 daddy – Nissan Navara

VER a year ago, Nissan an- a lateral tilt angle of up to 50 degrees. nounced that it would start The new engine delivers 140kW Obuilding its award-winning at 3 750rpm and 450Nm, which is Nissan Navara one-tonne pick-up available across a wide engine spec- from its Rosslyn plant in Pretoria, trum and which peaks for 1 000rpm South Africa. between 1 500rpm and 2 500rpm. Fuel This is a significant milestone for consumption in a combined cycle has Nissan’s industrial expansion in Afri- been officially rated at 6.5 litres per ca which will result in efficient prod- 100km, allowing for a range of over 1 uct delivery to the African market. 000km on a full 80 litre fuel tank. The Rosslyn plant has been pro- The double cab models all feature ducing various models for 60 years, the new coil spring rear suspension. operating exclusively as a Nissan The set-up combines traditional pick- plant since the 1980s. up load carrying capabilities, with the Most recently, it has become a light benefits normally associated with an commercial vehicle hub for the pro- SUV with a similar suspension set-up. duction of the NP300 Hardbody and These include better road holding, NP200 pick-ups which are exported to car-like ride comfort even over rut- 45 African markets. ted gravel roads and better tracking 2020 will see the first of the Nis- through high-speed corners. san Navara models rolling off the pro- It is available with either a six- duction line, strengthening the brands speed manual gearbox or a new, sev- market leading position. At home, en-speed automatic gearbox. The au- Nissan Clover Leaf Motors continues tomatic gearbox features gear ratios to flourish with sales of the all new selected to specifically optimise the Navara and other Nissan models. torque delivery of the new twin turbo With the introduction of the first engine and also offers a manual shift- generation Navara back in 1997 onto ing function. the market, Nissan has become a Behind the steering wheel, the strong contender in the pickup seg- driver is welcomed by a brand-new ment. The all-new Nissan Navara. cockpit design. The design centres To date millions have been sold on the touch-screen infotainment and globally and all who ar loyal to the cab. ang-style LED daytime running lights 500kg. navigation system that is standard brand are proud of the heritage the The striking new design of the all- across the range. The High-grade also The Navara has a 229mm ground equipment across the range. Navara has added to the Nissan brand. new Navara centres on the next-gen- features LED turn indicators in the clearance, but the new raised suspen- When it comes to infotainment, All models will be powered by the eration V-motion grille. The V-shape chromed side-mirrors. sion set-up and smart design have it’s an entertainer’s dream there is no new 140 kW YS23DDT twin-turbo of the bold chrome grille flows into Load carrying capacity has also allowed for a 3-degree improvement compromise. High-grade models also diesel engine. the creased bonnet and is resolved on been upgraded significantly. The new in the approach (33.0 degrees), ramp- add features such as dual zone climate Coupled with the award-winning the tailgate, which features a stamped Navara can carry up to 1 002kg, de- over (25.2 degrees) and departure an- control and keyless entry with a Start/ coil, five link rear suspension, the all V-motif. The first hints of the Na- pending on specification level, and gles (27.9 degrees). Stop button. new Navara packs a lot of punch. Talk vara’s SUV-features are seen in the thanks to its powerful new engine The suspension and drivetrain set- ●For enquiries contact Nissan Clo- about luxury and stability in a double full LED-headlights with boomer- it can tow a braked trailer of up to 3 up also means that the new Navara has ver Leaf Motors The Financial Gazette January 28-February 03 2021 | Page S7 Page S8 | January 28-February 03 2021 The Financial Gazette