SA FDI Surges Ttage and the Avarice of Cartels Is False Robertson Said

COMPLETE GWANDA PROJECT, COURT ORDERS ZPC: Page 4 $6 News Worth Knowing Listed firms to report quarterly: Page 3 June 20-26 2019 ESTABLISHED 1969 @ FingazLive www.fingaz.co.zw Facebook: The Financial Gazette ZSE Report The All Share index increased by 0,29 percent on Tuesday to close ‘Alarming at 219,03 points. Delta added $0,0626 to settle at $3,8999 while Innscor gained $0,0498 to close at $2,7500 as Simbisa advanced by $0,0476 to close at $1,3000. The Industrial Index was up 0,29 percent to close at 731,22 points as the Top 10 Index gained 0,35 percent to close at 216,35 points. sabotage The Minings Index was flat at 266,63 points. Currencies (Bloomberg) % change ◀ USD:ZAR 14,5315 0,06 EUR:USD 1,1204 ◀ 0,09 ◀ GBP:USD 1,2584 0,21 USD: JPY 108,4500 0,13 ◀ Stock Markets ◀ talk just a ZSE (All Share) 219,03 0,29 ZSE (Minings) 266,63 0,00 14,709,00 0,26 JSE ◀ FTSE 100 7 953,88 ◀ ◀ 1,35 Dow 26 465,54 Commodities 0,14 Gold 1 334,66 ◀ ◀ Platinum 804,32 0,02 0,58 govt ruse’ Brent Oil 61,78 ◀ Grains (Grain SA) White Maize ZAR 2 571,78 2.0 ◀ Shame Makoshori “Yes, there may be some people who are Soya ZAR 4 876,52 ◀ 0.8 Companies Editor exploiting a bad situation created by govern- Wheat ZAR 2 837,07 ◀ 2.4 ment to make (super) profits … but if business HE government’s claim that Zimba- exploits that situation it is not sustainable. bwe’s economy is failing due to sabo- They will wipe themselves out of existence,” SA FDI surges Ttage and the avarice of cartels is false Robertson said. and a deplorable act of deception by the State, The seasoned commentator’s views were FOREIGN direct investment (FDI) analysts say. supported by Zimbabwe National Chamber of in South Africa made a significant This comes as a number of senior govern- Commerce (ZNCC) chief executive Christo- recovery in 2018 after several years ment officials, including Industry minister pher Mugaga, who said the “culture of blame of low-level inflows, according Mangaliso Ndlovu, have claimed that some game in the country had been entrenched to the latest UN world investment businesspeople are allegedly sabotaging the during ex-president Robert Mugabe’s era and report. local economy by working to restrict competi- had continued to haunt business”. In contrast, investment in some tion and maintaining the prices of basic goods The trained economist added that the “harsh of the other large recipients in the in the country sky-high. tones” coming out of government, despite talk continent, including Nigeria, Egypt John Robertson, a veteran economist, said of efforts to woo foreign direct investment and Ethiopia, declined in 2018. The report, which is meant to business was only responding to the rampag- (FDI), would unfortunately continue to create support policymakers and help ing inflation, thriving parallel foreign currency impressions of instability in the country and them make decisions by monitor- market and the high cost of doing business in also work to dampen investor confidence. NEWLY-elected Chamber of Mines first female president Eliza- ing global and regional FDI trends, the country in everything it was doing. “It has become the culture of our govern- beth Nerwande-Chibanda. The Mimosa Mining corporate com- states that investment flows in SA “The business sector is actually a victim of ment to blame business whenever we have munications executive takes over the reins of Zimbabwe’s largest more than doubled to $5,3bn in bad policies created by government, such as problems since the Robert Mugabe era. You mining organisation at a time the sector is subdued due to a severe 2018, but this was largely attribut- unsustainable taxes. Thus, you cannot blame will remember the price freeze of 2005 which foreign currency crisis that has affected production, with gold the able to intracompany transfers by business … We need to fix the real problems,” led to the closure of companies,” Mugaga said. hardest hit. The mining sector accounts for about 20 percent of established investors. – Business- he told The Financial Gazette this week. To Page 2 Zimbabwe's GDP. Day Page 2 | June 20-26 2019 The Financial Gazette National News ‘Alarming sabotage talk just a govt ruse’ From Page 1 tions … to get the necessary buy-in from var- “Government must be sincere in its dealings with ious stakeholders and moderate the pain asso- business. We must deal with the problems affecting the ciated with the austerity measures,” he said, economy … and business must also be honest,” he said. adding that “the school of thought that some Tendai Biti, a former Finance minister during the era remnants of the previous administration were of the short-lived inclusive government, also blamed the pulling the strings or in the opposite direction current economic travails being experienced in the coun- were also a bit overplayed”. try on State profligacy, corruption and a lack of under- According to Ndlovu, the state has not only standing of economic fundamentals by the authorities. identified monopolies in the dairy, sugar and “Business is driven by profit. It needs a functioning poultry sectors, but they will break “these car- economy and prices are not going up because of sabo- tels by funding and creating competition as tage, but because the environment is terrible,” he said. well as tightening legislation”. “We have huge imports and we are not exporting. Meanwhile, Econometer Global Capital Our current account is 15 percent of GDP, which is too (Econometer) says there seems to be a seri- high. Then there is a premium on the American dollar, ous “lack of political will to tackle the coun- which has become a commodity ... and we have a terri- try’s underlying problems, as seen during ble monetary policy,” Biti said. the launch of the tripartite negotiating forum The feisty lawyer and Movement for Democratic (TNF)” and Nelson Chamisa's absence from Change kingpin also said contrary to claims that private mainstream dialogue. sector cartels were killing the economy, “those with “This could be an exercise in futility given strong links to the establishment were the ones calling that 44,3 per cent of electorate voted for him the shots”. Christopher Mugaga Persistence Gwanyanya (Chamisa),” it said. Another economist, Persistence Gwanyanya, said do. Government’s role is to create a conducive The Financial Gazette that instead of blaming “The violent repression of protests… in what was important was to get the business environment environment and blame games will not work. business, government should address foreign August 2018 and January… were universally right, not blaming each other for the country’s current Prices are going up in reaction to the interbank currency shortages and also work out strate- condemned by the international community, challenges. market, which is not functioning efficiently,” gies to increase confidence in the free-falling setting back Zimbabwe’s efforts to re-engage “We want everyone to concentrate on what they must he said. domestic currency. the international community,” Econometer “For as long as it is inefficient, the ex- “Perhaps in the context of sanctions I said, adding that the deadlock over last year’s change rate and prices will continue to rise. would agree that there is economic sabotage. elections was also partly responsible for un- We have seen improvements on the fiscal side, However, in as far as local business is con- dermining the attraction of FDI into the coun- but have been lagging behind on the monetary cerned, while there might be an element of try. policy side. We do not need to blame each oth- profiteering, people are mostly just reacting to After a brief period of economic stability er,” Gwanyanya said. the economic realities on the ground,” he said. in the country between 2009 and 2013, Zim- Kingstone Kanyile, Mtikikwe Financial “The main issue is to do with forex short- babwe’s economy has descended into chaos Services’ chief executive, also said the current ages and lack of confidence in the RTGS dol- again, with inflation hitting an official 98 per- economic turbulence was a result of “fiscal lar and bond notes, which has led to a free fall cent in May — the highest since dollarisation, and monetary policy inconsistencies” that had of the local unit on the parallel market and, while foreign currency exchange rates are run- increased economic risk. consequently, price increases driven by these ning amok. “It follows that during times of economic exchange rate movements,” Chikohora, a for- Rolling blackouts have also been wreaking uncertainty, all sorts of unexpected market mer ZNCC president, said. havoc on the economy, costing the country norms become everyday practice,” he said, Denford Mutashu, the Confederation of and business billions of dollars. adding that the hyperinflation and losses ex- Zimbabwe Retailers president, said the gov- “Movements on the foreign exchange perienced in 2008 were “a candid reminder of ernment must not make unilateral decisions market have … piled inflationary pressure on the need to work on mitigating a repeat of such when dealing with matters affecting the econ- business whose pricing is now determined by a scenario, and lessening risks”. omy and business. (that) market,” Econometer said. Trust Chikohora, another economist, told “The first issue is lack of wider consulta- [email protected] Axed Old Mutual boss fights back ETER Moyo, who was axed as Old Mutual CEO on Tuesday, is not going quietly. P Initially suspended three weeks ago with the insur- er citing a conflict of interest due to his involvement with a financial services company that he helped found in the ear- ly 2000s, Moyo vowed to clear his name in court after Old Mutual accused him of wrongly pocketing more than R30 million in dividends from NMT Capital.

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