GOVT TO ROLL OVER $2,2BN TBs: Page 3 $4 News Worth Knowing ‘New Zim currency illegal’: Page 3 March 28-April 3 2019 ESTABLISHED 1969 @ FingazLive www.fi ngaz.co.zw Facebook: The Financial Gazette ZSE Report THE All Share index retreat- ed 0,76 percent on Tuesday Spiralling to close at 120,87 points. PPC lost $0,33 to end at $1,32. TSL shed $0,1 to trade at $0,6 while Old Mutual dropped $0,0658 to close at $7,0437. The Industrial index was down 0,77 percent to close at 402,58 points, while the Top 10 index was fl at at 113,49 points. The business Minings index was also fl at at 201,72 points. Currencies (Bloomberg) % change ◀ USD:ZAR 14,5905 1,21 EUR:USD 1,1259 0,06 ◀ GBP:USD 1,3215 ◀ 0,02 USD: JPY 110,5000 0,16 ◀ Stock Markets ZSE (All Share) 120,87 0,76 costs hit ◀ ZSE (Mining) 201,72 0,00 13 818,00 0,59 JSE ◀ ◀ FTSE 100 7 198,74 0,03 ◀ 0,22 Dow 25 713,48 Commodities ◀ Gold 1 311,74 0,30 ◀ Platinum 862,43 0,39 ◀ Zim firms Brent Oil 68,28 0,46 Grains (Grain SA) Omega Ukama and Nelson Gahadza and companies have also been feeling the pinch White Maize ZAR 2 145,76 ◀ 0,2 ◀ Staff Reporters from the depleting demand” of goods and ser- Soya ZAR 4 781,71 0,01 vices in the country. Wheat ZAR 2 491,20 ◀ 0,4 IMBABWEAN businesses are groaning “So, there is need to compensate labour for under the weight of mounting costs driv- the erosion, but the problem then becomes the Zen by rising infl ation, burgeoning wage fact that there is little capacity to do that on the Lloyd’s loses £1bn bills, the escalating costs of imported inputs part of business,” he said. and the falling value of the local RTGS dollar. On its part, milk processor Dairibord said to natural disasters Christopher Mugaga, the Zimbabwe Na- the recent market developments had had a neg- INSURER Lloyd’s of London tional Chamber of Commerce chief executive, ative impact on its product supply and “the cost has reported a second consec- told The Financial Gazette this week that the of doing business, leading to consumer price utive year of losses as its syn- government’s recent monetary reforms had increases”. dicates were hit by a range of effectively worked to open “the fl oodgates of Going forward, the company said, it would natural disasters, although it said reality”. focus on “cost reduction and containment to that its results showed the “green “There is considerable pressure on business- sustain margins”. shoots of improvement”. es from labour and other issues, but the bigger Grain miller National Foods said its opera- Lloyd’s registered a £1 bil- issue is whether companies are comfortable tional expenditure for the half year to Decem- lion loss for 2018, against a £2 with a managed fl oating rate of the local cur- ber 31, 2018 had increased by 58,6 percent to billion loss the previous year. rency,” he said. $37,4 million — compared to the same period It blamed hurricanes Flor- “Export proceeds of this country will show last year. ence and Michael in the US, as you that the forex is there in the market, but it “Infl ationary pressure was evident across well as Typhoon Jebi in Japan (the market) is not keen on the offi cial rate,” all cost lines, particularly those costs with im- DAIRIBORD Holdings (Dairibord) chief executive Anthony and wildfi res in California, say- Mugaga said. ported content such as plant and vehicle main- Mandiwanza. The listed milk processor’s boss said his com- ing that it incurred £2,9 billion Sifelani Jabangwe, the Confederation of tenance costs,” Natfoods’ chairman Todd Moyo pany was forced to offl oad its Malawian unit due to deterio- of costs from major claims, well Zimbabwe Industries president, said: “Infl ation said. rating economic conditions in Zimbabwe. up from the long-term average of has signifi cantly eroded the value of wages, To Page 2 - Picture by Freedom Mashava £1,9 billion. – Financial Times Page 2 | March 28-April 3 2019 The Financial Gazette National News Spiralling business costs hit Zim firms From Page 1 “Landlords think they can just multiply rentals by 2,5 Themba Ndebele, Truworths’ CE, also and it will be okay. But consumers’ incomes have not said trading expenses for his company had been increased by 150 percent,” he said. increased significantly during the half year to “It is very difficult for us to see eye-to-eye (with January this year. landlords). It looks like it is going to be tough to adjust “Inflationary pressures will persist in the to the devaluation,” Ndebele said. next few months on imported finished prod- The Truworths boss also said the clothing chain had uct lines with the official devaluation of the had to “make an additional cost of living adjustment for RTGS$ exchange rate and re-rating of the employees due to the rising inflationary pressures”. value for duty purposes from 1:1 to 1:2,5,” he In addition, Truworths had seen an 82,95 percent in- said at his company’s results briefing in Harare crease in landing costs for imported goods since the duty last week. calculation was changed from a rate of 1:1 to a floating “Another wave of price increases is inev- rate — which debuted at 1:2,5 and has since increased itable,” Ndebele, who heads the Zimbabwe to 2,9. Stock Exchange-listed retail apparel group Batanai Matsika, the research head at Morgan & Co, said, adding that this would “further dampen said although businesses were already severely bur- demand as personal income growth lags be- dened, “the need to provide a cushion for workers whose hind price increases.” wages have been devalued is very real”. The Truworths boss said many hard- “Inflation in the broader economy has persisted, the pressed businesses were also facing increased fuel prices, the two percent tax and the general price in- rentals. Themba Ndebele Batanai Matsika creases which have followed have all created the pres- sures,” he said. “We have seen that employers are trying to be inno- vative in easing the pressures by offering wages in US dollars and providing special allowances,” Matsika said. He added that the operating environment in the coun- try had significantly pushed up companies’ cost-to-in- come ratios. “Companies have tried to adjust through pricing, but there is a limit to the levels that they can push prices up because they have to contend with diminishing demand, as well as market share considerations,” Matsika said. Israel Murefu, the Employers Confederation of Zim- Smallholder Irrigation Revitalisation Programme (SIRP) babwe (EMCOZ) acting president, said “while it is de- sirable to adjust salaries, there is a guiding principle that REQUEST FOR EXPRESSIONS OF INTEREST businesses should follow, which is the ability to sustain operations”. (CONSULTING SERVICES – INDIVIDUAL CONSULTANTS SELECTION) “The issue of inflation and loss of value is not only [ZIMBABWE] impacting employees, but employers also,” he said. “What is key is the sustenance of capacity, ability to SMALLHOLDER IRRIGATION REVITALIZATION PROGRAMME source inputs ... but if there is room to manoeuvre, there is no reason not to adjust incomes,” Murefu said. International fund for Agricultural Development IFAD)/OPEC Fund for International Development (OPEC) He also warned that there was a risk that hard-up businesses could end up retrenching, due to their failure to maintain salaries. Smallholder Irrigation Revitalization Programme Loan No./Credit No./ Grant No.:5000001640 “The cost of production has increased due to rising input costs,” Murefu said. Assignment Title: Senior Irrigation Engineer “Even duty has become more expensive even if it is pegged in US dollars. The moment you cross-rate with Reference No. (as per Procurement Plan): 2018 PP 3 the RTGS dollar, it becomes expensive and with current rates, you will pay three times more,” the EMCOZ boss said. [email protected] The Government of Zimbabwe has received financing from IFAD toward the cost of the Smallholder Irrigation Revitalization Programme, and intends to apply part of the proceeds to recruit Individual Consultants and a Programme Driver as follows: Corporates pump TENDER NUMBER CONSULTANCY $10m into Cyclone 29/ZIMB/SIRP/30042019 Senior Irrigation Engineer Consultant Vacant Post Driver Idai rescue efforts IMBABWEAN corporates have pumped near- ly $10 million into helping victims of Cyclone Terms of references (TORs) can be down loaded on www.moa.gov.zw or www.sirpzim.org. The same Idai, which brought floodwaters and destruc- can also be obtained from the address below during office hours (between 09:00 to 16:30 hours): Ztion to Chimanimani, and Chipinge, sparking a seri- ous humanitarian crisis. Procurement Specialist (SIRP) With Strive Masiyiwa’s Econet Group donating $5 million-plus and Delta Corporation at $1,5 million, Ngungunyana Building Innscor Africa chipped in with eight truckloads of Office Number 11, foodstuffs worth $300 000 and followed by Stanbic Bank, which provided goods valued at $200 000. 1 Borrowdale Road The Adam Molai Foundation also sent in medical specialists and donated goods, including blankets, Harare mineral water, rice and other items worth $250 000 to Interested applicants who meet the driver’s position requirements should direct applications before assist those affected by the natural disaster. Fixed telecommunications firm TelOne donated Tuesday 26 April 2019 to: groceries worth $100 000, while SeedCo coughed up 60 tonnes of maize and mealie-meal. The Confederation of Zimbabwe Industries (CZI) The Human Resources Director, Ministry of Lands, Agriculture, Water, Climate and Rural launched the Donate a Blanket Campaign, while other Resettlement , 1 Borrowdale Road, Ngungunyana Building, Private Bag 7701, Causeway, Harare.